A.R.S. tit. 41 | Title 41 — State Government

Chapter 1 Executive Officers

Article 1 The Governor

§ 41-101 Powers and duties; attestation of acts of governor; salary

A. The governor has the powers and shall perform the duties as prescribed in this article. The governor:

Shall supervise the official conduct of all executive and ministerial officers.
Shall see that all offices are filled and the duties performed or, in default, invoke such remedy as the law allows.
Shall appoint a private secretary to the governor and shall appoint all officers of this state not made elective, unless otherwise provided.
Notwithstanding section 38-211, shall appoint the lieutenant governor to serve as the governor's chief of staff or the director of the Arizona department of administration or to fill any position for which the governor is otherwise authorized by law to make an appointment.
Shall be the sole official means of communication between this state and the government of any other state or the United States.
May direct the attorney general to appear on behalf of this state when any action or legal proceeding is pending that affects the title of this state to any property or that may result in a claim against this state.
May require the attorney general, or any county attorney, to inquire into the affairs or management of any corporation doing business in this state.
May require the attorney general to aid a county attorney in the discharge of his duties.
May offer rewards for escaped insane persons, not exceeding five hundred dollars.
May require any officer or board to make special reports to him on demand in writing.
May convene the legislature at some other place when the seat of government becomes dangerous from disease or a common enemy.
May enter into intergovernmental agreements with officers, agencies or departments of the United States to provide funding or other resources available from any related state agency, board or commission for the purpose of operating federal parks located in this state during any period when such parks would otherwise be subject to shutdown due to a lack of federal appropriation and as deemed necessary to promote tourism, this state's economic well-being, or the health, safety or welfare of the state's citizens. The governor shall not provide general fund appropriations from any related state agency, board or commission to operate a federal park pursuant to this paragraph for more than twenty-one days without the approval of the legislature. The joint legislative budget committee shall review any expenditure of funds or other resources pursuant to this paragraph.
Has such powers and shall perform such other duties as devolve on him by law.

B. All official acts of the governor, except approval of the laws, shall be attested by the secretary of state.

C. The governor is eligible to receive an annual salary pursuant to section 41-1904.

D. Before an individual is hired as an employee of the office of the governor, that individual shall submit a full set of fingerprints to the governor for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

§ 41-101.01 Authority to accept and expend certain funds

A. The governor, except as otherwise provided by law, is authorized to accept and expend any grants, donations, aids, or other funds received from the federal government or any agency thereof pursuant to Public Law 88-452, the economic opportunity act of 1964, and Public Law 89-136, the public works and economic development act of 1965, and any other funds made available to the state through any federal statutes, and in receiving and expending such funds, the governor shall be considered the agency of the state for all the purposes provided by this section.

B. The governor's office is designated as this state's recipient of federal stop violence against women act grants. The governor's office shall use monies received from these grants, subject to federal law.

§ 41-101.02 Authority to enter reciprocal aid agreements

A. The governor may on behalf of the state enter into reciprocal aid agreements or compacts with other states or the federal government, either on a statewide or local subdivision basis. Such mutual aid arrangements shall be limited to furnishing or exchange of:

Police services.
Personnel necessary to provide or conduct such services.
Such other supplies, equipment, facilities, personnel and services as needed. The agreements may relate to the terms and conditions of mutual aid and to reimbursement of costs and expenses for equipment and supplies, personnel and similar items for mobile support units and police units.

B. The provisions of subsection A do not affect, modify, limit or pertain to powers of the governor provided for by title 26, chapter 2, article 1.

§ 41-101.03 State employee travel reduction program; designated state agency; fund

A. The governor shall designate an appropriate state agency to establish, administer and operate a travel reduction program for the transportation of state employees between their residences and their place of work. The designated agency shall establish the travel reduction program for the voluntary participation by state employees in any area of this state where a sufficiently large number of state employees reside and where the costs of administering a travel reduction program would not be excessive.

B. There is established the state employee travel reduction fund which consists of monies appropriated by the legislature, unrestricted private grants, gifts, contributions and devises, federal funds, and fees. The state agency designated by the governor pursuant to this section shall administer the fund and may disburse monies from the fund only in direct support of the travel reduction program established by this section. Monies in the fund appropriated by the legislature are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-102 Record required

A. The governor shall keep the following:

A record of his official acts.
An account of his official expenses and disbursements, including incidental expenses of his department.
A register of all appointments made by him, with date of commission, names of the appointee and predecessor.

B. All documents received by the governor in his official capacity shall be kept in his office.

§ 41-103 Receipt of military supplies

The governor may in the name of the state receive and receipt for all arms, ammunition, accoutrements, ordnance or military stores to which the state becomes entitled, and if a bond is required by the United States obligating the state to return them, or pay therefor, the governor may sign, seal and deliver such bonds in the name and on behalf of the state.

§ 41-104 Offer of reward for information leading to apprehension of convict or arrest and conviction of felon; authorization for payment

A. The governor may offer a reward, not exceeding ten thousand dollars, for information leading to the apprehension of a convict who has escaped from the state prison or for information leading to the arrest and conviction of any person or persons who have committed or are charged with commission of a felony.

B. The governor shall certify to the department of administration the name of the person giving the information leading to the arrest, immediately upon conviction of the person arrested. The governor may, if the person certified to the department of administration is alleged to have been, or has admitted to be, an accomplice, principal or accessory in such crime, direct that the reward so offered be reduced to an amount not less than ten dollars. In determining the amount the governor shall take into consideration the value of the information in securing a conviction, the availability of the information from other sources and the culpability of the person providing the information. Upon certification of the name and the amount the director of the department of administration shall draw his warrant to be paid from the state general fund.

§ 41-105 Exchange of offenders under treaty; consent by governor

If a treaty in effect between the United States and a foreign country provides for the transfer or exchange of convicted offenders to the country of which they are citizens or nationals, the governor may, on behalf of this state and subject to the terms of the treaty, authorize the director of the department of corrections to consent to the transfer or exchange of offenders and take any other action necessary to initiate the participation of this state in the treaty.

§ 41-106 Advisory board; reimbursement of expenses

Members of an advisory board established by the governor are eligible, subject to legislative appropriation, for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

§ 41-107 Office of Sonora

A. The office of Sonora is established in the office of the governor.

B. The governor shall appoint a director of the office pursuant to section 38-211 to serve at the pleasure of the governor.

C. The director of the office is eligible to receive compensation as determined under section 38-611.

D. The office shall:

Promote a greater understanding and facilitate the implementation of the North American free trade agreement.
Facilitate the flow of information and act as a liaison in the establishment of commercial relationships between Sonora, Mexico and this state.
Facilitate educational and training exchange programs between Sonora, Mexico and this state.
Promote the growth of tourism between Sonora, Mexico and this state to contribute to our economic and cultural development.
Assist the Arizona-Mexico commission.
Support the activities of various state agencies in Sonora, Mexico.
Adopt rules it deems necessary or desirable to further the objectives and programs of the office.
Formulate policies, plans and programs to effectuate the purposes of the office.
Employ, determine the conditions of employment and prescribe the duties and powers of administrative, professional, technical, secretarial, clerical and other persons as may be necessary in the performance of its duties and contract for the services of outside advisors, consultants and aides as may be reasonably necessary.
Make contracts and incur obligations within the general scope of its activities and operations subject to the availability of monies.
Contract with or assist other departments, agencies and institutions of the state, local and federal governments in the furtherance of its purposes, objectives and programs.
Subject to section 35-149, accept, expend and account for grants, monies and direct payments from public or private sources and other grants of money or property for the conduct of programs that are consistent with the overall purposes and objectives of the office.
Provide information and advice on request by local, state and federal agencies and by private citizens, business enterprises and community organizations on matters within the scope of its duties subject to its rules on the confidentiality of information.
Advise with and make recommendations to the governor and the legislature on all matters concerning its objectives.
Contract and enter into interagency and intergovernmental agreements pursuant to title 11, chapter 7, article 3 with any private party or public agency.

§ 41-108 Foster youth education success program; fund; report

A. The foster youth education success program is established in the office of the governor for the purpose of improving the educational outcomes of children in this state's foster care system.

B. The foster youth education success fund is established consisting of monies appropriated to the fund and monies received by the office of the governor from any lawful public or private source for this purpose. The office of the governor shall administer the fund. Monies in the fund are continuously appropriated. The office of the governor may accept and spend local, state and federal monies and private grants, gifts, contributions and devises to assist in carrying out the purposes of this section. Monies in the fund do not revert to the state general fund.

C. The office of the governor shall establish policies and procedures, selection criteria and minimum performance standards for service providers that wish to participate in the program.

D. A service provider that is selected to participate in the program shall:

Contract with an organization that is exempt from federal income taxes under section 501(c)(3) of the internal revenue code and that provides the following programmatic components:

(a) A partnership with local education agencies, child welfare agencies and judicial agencies to implement a continuous cycle of data-driven interventions for children in foster care.

(b) Identification and support of an education champion for children in foster care who is informed of rights and responsibilities and paired with an education coach to increase capacity to support educational success for children in foster care.

(c) Development and monitoring of an education team, which may include education liaisons, students, social workers, school staff, caregivers, court-appointed special advocates, coaches, mentors or other community members.

(d) A customized education plan for each child in foster care that is based on individual strengths and needs and that uses a research-based tool.

Submit an annual report on or before December 15 to the governor, the president of the senate and the speaker of the house of representatives that includes an evaluation of the effectiveness of the program, including demographic information and academic outcomes. The service provider shall provide a copy of this report to the secretary of state.

§ 41-109 Prevention of child abuse fund; definitions

A. The prevention of child abuse fund is established consisting of monies received pursuant to section 28-2417. The director of the governor's office of youth, faith and family shall administer the fund. Not more than three percent of monies deposited in the fund annually shall be used for the cost of administering the fund. Monies in the fund are continuously appropriated.

B. The governor's office of youth, faith and family shall allocate monies to primary prevention programs that strengthen families and that increase public and professional awareness to prevent child abuse in all its forms to children in this state. Beginning January 1, 2020, monies received pursuant to section 28-2417 may be allocated to child and family advocacy centers to provide support to victims of child abuse.

C. On notice from the director of the governor's office of youth, faith and family, the state treasurer shall invest and divest monies in the fund as provided by section 35-313 and monies earned from investment shall be credited to the fund.

D. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. Before allocating monies pursuant to subsection B of this section:

The director of the governor's office of youth, faith and family shall prepare and issue a request for donation application that includes at least the following information:

(a) A description of the nature of the donation project, including the scope of the work to be performed by an awardee.

(b) Identification of the funding source and the total amount of available monies.

(d) Encouragement of collaboration by entities for community partnerships, if appropriate.

(e) Any additional information required by the applications.

(f) The criteria or factors under which an application will be evaluated for award and the relative importance of each criteria or factor.

(g) The due date for submittal of an application and the anticipated time the awards may be made.

Adequate public notice of the request for donation application shall be given a reasonable time before the date set forth in the request for application. The notice may include publication one or more times in a newspaper of general circulation in this state a reasonable time before the application opening.
A preapplication conference may be conducted before the due date for the submittal of an application to explain the donation application requirements. Statements made at a preapplication conference are not amendments to a request for a donation application unless a written amendment is issued.
A donation application shall be publicly received at the time and place designated in the request for donation application. The name of each applicant shall be publicly read and recorded. All other information in the donation application is confidential during the process of evaluation. All applications shall be open for public inspection after donations are awarded. To the extent the applicant designates and the state concurs, trade secrets and other proprietary information contained in the application shall remain confidential.
An application shall be evaluated by at least three evaluators who are peers or other qualified individuals. The evaluators may allow an applicant to make an oral or written presentation regarding the scope of work, terms and conditions of the donations, budget and other relevant matters set forth in the request for application. An applicant shall be accorded fair treatment with respect to any opportunity for oral or written presentations. The evaluators may require an applicant to revise the application to reflect information provided in an oral or written presentation. Any person who has information contained in the application of competing applicants shall not disclose that information.
The evaluators shall review each application based solely on the evaluation criteria or factors set forth in the request for donation application. Each evaluator shall maintain a written record of the evaluator's assessment of each application, which shall include comments regarding compliance with each evaluation criteria or factor, the citation of a specific criteria or factor as the basis of each stated strength or weakness and a clear differentiation between comments based on facts presented in the application and comments based on professional judgment.
The evaluators shall make award recommendations to the director of the governor's office of youth, faith and family based on the evaluators' reviews of each application. The evaluators' recommendations may include the adjustment of the budgets of the applicants individually or collectively.
The director of the governor's office of youth, faith and family may affirm, modify or reject the evaluators' recommendations in whole or in part. Modification of the evaluators' recommendations may include the adjustment of the budget on any proposed award individually or on all awards by an amount or percentage. If the director of the division modifies or rejects the recommendations, the director shall document in writing the specific justifications for the action taken.
The director of the governor's office of youth, faith and family may enter into agreements with other state governmental units to furnish assistance in conducting the solicitation of donation applications.
The director of the governor's office of youth, faith and family may resolve protests of the award or proposed award of a donation. An appeal from a decision of the director of the governor's office of youth, faith and family may be made to the director of the department of administration. A protest of an award or proposed award of a donation and any appeals shall be resolved in accordance with the rules of procedure adopted by the department of administration pursuant to section 41-2611.

F. On or before December 31 of each year, the director of the governor's office of youth, faith and family shall submit a written report to the governor, the president of the senate and the speaker of the house of representatives on all expenditures made from the fund in that calendar year. The report shall include all administrative expenses, all grants of monies, the names of grantees and any remaining balance in the fund. The director shall provide a copy of the report to the secretary of state and the director of the Arizona state library, archives and public records.

G. The director of the governor's office of youth, faith and family shall make available to the public a list of all grants awarded pursuant to this section.

H. For the purposes of this section:

"Donation" means furnishing financial or other assistance, including state monies or federal grant monies, by the director of the governor's office of youth, faith and family to any person for the purpose of supporting or stimulating primary prevention programs that strengthen families and that increase public and professional awareness to prevent child abuse in all its forms to children of this state if no substantial involvement between the governor's office of youth, faith and family and the recipient occurs during performance.
"Person" means any corporation, business, individual, committee, club or other organization or group of individuals.

§ 41-110 Crisis contingency and safety net fund; exemption; use of monies

A. The crisis contingency and safety net fund is established consisting of monies appropriated to the fund and monies received by the office of the governor from any lawful public or private source. The office of the governor shall administer the fund. Monies in the fund are continuously appropriated. The office of the governor may accept and spend local, state and federal monies and private grants, gifts, contributions and devises to assist in carrying out the purposes of this section. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies in the fund may be spent only following a state of emergency declaration by the governor and only for the following forms of economic assistance during the state of emergency:

Housing assistance, including payments to prevent eviction or foreclosure.
Monies for entities to provide services for homeless persons, including shelter, food, clothing and transportation.
Economic assistance to small businesses with fewer than fifty employees, nonprofit organizations and health care providers.
Monies for food bank operations.

C. Before spending monies in the fund, the office of the governor shall notify the president of the senate, the speaker of the house of representatives and the joint legislative budget committee on the intended use of the monies.

D. Monies in the fund shall be used to supplement and not supplant any monies allocated by the federal government for economic assistance during a state of emergency.

§ 41-111 Inauguration expenses; donations; promotional fund account; exemption

A. The governor or governor-elect shall deposit in a state promotional fund account established pursuant to section 41-1105 all monies raised or received for the purpose of paying the costs of that governor's inauguration events and shall pay those costs with monies from the state promotional fund account.

B. An individual or entity may donate monies, services or other things of value for the purposes of paying the costs of gubernatorial inauguration events not to exceed an aggregate of $25,000. For the purposes of aggregating donations, any donations of monies, services or other things of value that are made by an entity that is a controlled business as defined in section 38-541 shall be aggregated with the individual donor's donations.

C. Monies, services or other things of value that are lawfully donated pursuant to this section are not contributions for the purposes of title 16, chapter 6.

§ 41-114 Human trafficking victim assistance fund; definition

A. The human trafficking victim assistance fund is established consisting of monies received pursuant to sections 9-500.10 and 32-4260. The director shall administer the fund for the purposes prescribed in this section.

B. The governor's office for children, youth and families shall establish program priorities for the fund. The office shall spend monies in the fund to provide assistance to victims of sex trafficking prescribed in section 13-1307, child sex trafficking prescribed in section 13-3212, subsection A, paragraph 9 or 10 and trafficking of persons for forced labor or services prescribed in section 13-1308.

C. Monies in the fund do not revert to the state general fund.

D. For the purposes of this section, "director" means the director of the governor's office for children, youth and families.

§ 41-115 Alcohol, tobacco and drug education; definition

A. The governor's office of youth, faith and family or the department of health services may partner with state and local education agencies and facility-based nonprofit youth development organizations to annually teach children in grades five through twelve about the health dangers of federally defined illegal substances, tobacco, alcohol, marijuana, opioids and nonprescription pharmaceuticals.

B. For the purposes of this section, "facility-based nonprofit youth development organization" means an organization that provides proven and tested recreational, educational and character-building programs for children who are at least six and under nineteen years of age.

§ 41-116 Governor; official notification; display of flags; state agencies; state buildings; military service members; definition

A. The governor, after receiving official notification of the death of a military service member of the United States armed forces who was killed in action and who claimed this state as the military service member's home of record or who was stationed in this state, shall notify all state agencies to fly all flags displayed on or in front of all state buildings at half-staff pursuant to section 38-451.

B. For the purposes of this section, "official notification" means a casualty notification from the military service member's branch of service.

Article 2 The Secretary of State and the Department of State

§ 41-121 Duties

A. The secretary of state shall:

Receive bills and resolutions from the legislature, and perform such other duties as devolve on the secretary of state by resolution of the two houses or either of them.
Keep a register of and attest the official acts of the governor.
Act as custodian of the great seal of this state.
Affix the great seal, with the secretary of state's attestation, to public instruments to which the official signature of the governor is attached.
File in the secretary of state's office receipts for all books distributed by the secretary of state and direct the county recorder of each county to do the same.
Certify to the governor the names of those persons who have received at any election the highest number of votes for any office, the incumbent of which is commissioned by the governor.
Promptly chapter slip laws filed by the legislature, electronically publish and maintain the bills, memorials and resolutions posted on the secretary of state's website, make such acts available for a reasonable fee to include the cost of printing and postage, provide each house of the legislature and the legislative council with a certified copy of each chaptered bill or resolution and transfer to the custody of the Arizona state library, archives and public records all original paper copies filed.
Keep a fee book of fees and compensation of whatever kind and nature earned, collected or charged by the secretary of state, with the date, the name of the payer and the nature of the service in each case. The fee book shall be verified annually by the secretary of state's affidavit entered in the fee book.
Perform other duties imposed on the secretary of state by law.
Report to the governor on January 2 each year, and at such other times as provided by law, a detailed account of the secretary of state's official actions taken since the secretary of state's previous report together with a detailed statement of the manner in which all appropriations for the secretary of state's office have been expended.
Transfer all noncurrent or inactive books, records, deeds and other papers otherwise required to be filed with or retained by the secretary of state to the custody of the Arizona state library, archives and public records.
Accept electronic and digital signatures that comply with section 18-106 for documents filed with and by all state agencies, boards and commissions.
Meet at least annually with personnel from the federal voting assistance office of the United States department of defense and with county recorders and other county election officials in this state to coordinate the delivery and return of registrations, ballot requests, voted ballots and other election materials to and from absent uniformed and overseas citizens.

B. The secretary of state may refuse to perform a service or refuse a filing based on a reasonable belief that the service or filing is being requested for an unlawful, illegitimate, false or fraudulent purpose or is being requested or submitted in bad faith or for the purpose of harassing or defrauding a person or entity. This subsection does not apply to election filings.

§ 41-121.01 Salary

The secretary of state shall receive an annual salary pursuant to section 41-1904.

§ 41-121.02 Department of state

A. The department of state is established and shall be composed of the office of the secretary of state.

B. The secretary of state shall have charge of and direct the department of state.

C. Except as otherwise provided by law, employees of the department are subject to chapter 4, article 4 and, as applicable, articles 5 and 6 of this title.

D. Purchases and contracts for goods and services in the amount of $150,000 or less that are entered into by the Arizona state library, archives and public records are exempt from chapter 23 of this title.

E. The Arizona state library, archives and public records is exempt from chapter 6 of this title.

§ 41-122 Assistant secretary of state

The secretary of state shall appoint an assistant secretary of state who, in the absence of the secretary of state, or when the secretary of state is acting governor, shall perform the duties of the secretary of state.

§ 41-124 Receipt and record of documents received

The secretary of state shall provide a receipt of delivery for any document that is delivered to the secretary of state and record the number of documents delivered, to whom delivered and the date of delivery.

§ 41-125 Membership in national organizations; attending conventions

The secretary of state is authorized to hold membership in, and to maintain membership by the payment of dues to, the national organizations of state officials occupying a like office or performing similar functions, and is authorized to attend the national association of secretaries of state.

§ 41-126 Fees; expedited services

A. The secretary of state shall receive the following fees:

Making a copy of any document on file in his office, no more than ten cents for each page or partial page.
Filing and recording each application to become a notary public and transmitting a commission for a notary public, no more than twenty-five dollars.
Filing an application for registration or renewal of the registration of a trademark or recording an assignment of a trademark, fifteen dollars.
Filing an application for registration or renewal of the registration of a trade name or recording an assignment of a trade name, no more than ten dollars.
Issuing a certificate of registration of a trademark or a trade name, no more than three dollars.
Filing, as required by the uniform commercial code:

(a) A financing statement, no more than three dollars.

(b) An amendment to a financing statement, no more than three dollars.

(d) A continuation statement, no more than three dollars.

(e) A statement of release, no more than two dollars.

(f) A termination statement, no more than two dollars.

Issuing a certificate as provided in section 44-3146 naming a particular debtor, no more than six dollars.
Making a copy of a filed financing statement, no more than fifty cents per page.
Certifying a copy of a writing specified in paragraphs 6, 7 and 8 of this subsection, no more than three dollars.
Filing, recording or certifying any other document not specified in this section, no more than three dollars.
Filing the oath and bond of notary public, eighteen dollars.
Issuing a certificate as to official capacity of a notary public and affixing a seal to the certificate, eighteen dollars.

B. The secretary of state shall provide for and establish an expedited service for the processing of requests, applications, filings and searches as follows:

The expedited processing shall be a priority effected in a fast and efficient manner.
A fee shall be charged for expedited services. This fee shall not exceed twenty-five dollars per service and shall be in addition to any other fees provided by law, including those set forth in subsection A of this section.

C. The secretary of state shall adopt rules necessary to carry out subsection B of this section.

§ 41-128 Standing political committee administrative fund; purpose

The standing political committee administrative fund is established consisting of monies from filing fees that are paid by standing political committees. The secretary of state shall administer the fund. Monies in the fund are continuously appropriated. The state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund shall be used for the costs of administering and enforcing the campaign finance laws relating to standing political committees.

§ 41-129 Election systems improvement fund; purpose

A. The election systems improvement fund is established in the office of the secretary of state. The fund shall consist of monies received from the United States government, matching monies from state, county or local governments, legislative appropriations, gifts, grants and donations.

B. The secretary of state shall administer the fund. Any monies deposited into the fund in fiscal years 2002-2003 and 2003-2004 are appropriated to the secretary of state and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. To the extent permitted by federal law, monies in the fund, other than state general fund monies, deposited each subsequent fiscal year are subject to legislative appropriation and such appropriations are subject to the lapsing provisions of section 35-190. State general fund monies appropriated to the fund beginning in fiscal year 2004-2005 are available for use by the secretary of state without further appropriation. Monies in the fund do not revert to the state general fund or any other funding source at the end of the fiscal year. The state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. On or before December 31 of each year, the secretary of state shall submit to the joint legislative budget committee and the governor's office of strategic planning and budgeting a summary of the total expenditure plan for the fund.

D. Monies in the fund shall be used to implement the provisions of the help America vote act of 2002 (P.L. 107-252).

§ 41-130 Use of state seal restricted; violation; classification

A person may use, display or otherwise employ any facsimile, copy, likeness, imitation or other resemblance of the great seal of this state only after obtaining the approval of the secretary of state. The secretary of state may grant a certificate of approval upon application by any person showing good cause for the use of the great seal of this state for a proper purpose. The great seal of this state shall in no way be employed by anyone other than a state agency for the purpose of advertising or promoting the sale of any article of merchandise whatever within this state or for promoting any other commercial purpose. The secretary of state may promulgate rules for the use of the great seal of this state or any facsimile, copy, likeness, imitation or other resemblance of the great seal. Any person who knowingly violates this section is guilty of a class 3 misdemeanor.

§ 41-131 Certified copies; fee

A. On request, the secretary of state or the secretary's designee may certify under the great seal of the state of Arizona any publicly recorded document filed pursuant to this article.

B. The secretary of state may charge a copy fee per page pursuant to section 39-121.01 and shall charge a certified copy fee pursuant to section 41-126, subsection A, paragraph 10.

§ 41-133 Officeholder expenses; account; reporting; limitations; civil penalty; definition

A. Any person who holds elected statewide public office or a legislative office in this state, whether by election or appointment, may receive or spend monies to defray the costs of performing officeholder duties as follows:

An officeholder may receive contributions pursuant to this section only from individuals, and the maximum amount that may be received from an individual during an election cycle is one hundred fifty dollars.
The total amount that an officeholder may receive or spend pursuant to this section during an election cycle is ninety-eight thousand three hundred sixty dollars for the governor, fifty-one thousand six hundred eighty dollars for the secretary of state and the attorney general, twenty-five thousand eight hundred forty dollars for all other statewide officeholders and nine thousand eight hundred dollars for a legislator, which may include personal monies as prescribed by paragraph 3 of this subsection. The secretary of state shall adjust this amount biennially as prescribed in section 16-931.
An officeholder may contribute up to thirty percent of the limits as prescribed by paragraph 2 of this subsection of the officeholder's personal monies to the officeholder's expense account.

B. For an officeholder's future campaign monies received do not constitute a contribution as defined in section 16-901 if the monies are received, expended and reported as prescribed in this section.

C. An officeholder shall establish a separate account for officeholder expenses, which shall be separate from any candidate campaign account. The officeholder shall file a statement of organization for the account designated as an officeholder expense account. Monies raised or spent for officeholder expenses shall be reported under campaign finance reporting requirements pursuant to title 16, chapter 6, articles 1, 1.1, 1.2, 1.3, 1.4, 1.5, 1.6 and 1.7.

D. An officeholder shall not use monies in the officeholder account for campaign purposes. Permissible uses of monies in an officeholder account include the following:

Office equipment and supplies.
Travel related to the officeholder's duties.
Meeting or communicating with constituents.
Expenses for informational and educational purposes, including subscriptions to newspapers, magazines or other periodicals or websites or other informational services, membership or participation in community, professional or fraternal organizations and participation in conferences and seminars.

E. An officeholder shall not receive or spend monies from the officeholder account during the period beginning April 30 in an election year, shall complete the purchase or otherwise use the item before April 30 in an election year and shall not spend those monies until after the day of the general election. Any monies remaining in the officeholder expense account beginning April 30 in an election year may not be used except as follows:

Paid to the state general fund.
For a person who continues to hold office as prescribed in this section, carried forward to an officeholder expense account for another office or term of office, subject to the limitations prescribed by this section.
Donated to a political committee other than a person's exploratory committee or a candidate's campaign committee, unless the officeholder continues to hold office as prescribed in this section or the officeholder holds any other elected office immediately following completion of the officeholder's term.
Donated to an organization that qualifies under section 501(c)(4) of the United States internal revenue code, unless the officeholder continues to hold office as prescribed in this section or the officeholder holds any other elected office immediately following completion of the officeholder's term.

F. Except as prescribed in subsection E of this section, an officeholder shall not transfer officeholder account monies to any other account or committee except for another officeholder account for that same officeholder.

G. Section 41-1234.01 applies to contributions to an officeholder account for legislators.

H. A person who violates this section is subject to a civil penalty of three times any amount improperly received, spent or reported.

I. Sections 16-937 and 16-938 apply for the implementation and enforcement of this section.

J. Any monies held by an officeholder pursuant to the officeholder expense account rules established by the citizens clean elections commission are subject to this section, and the citizens clean elections commission has no further authority with respect to those monies.

K. For the purposes of this section, "officeholder" means a person who holds an elected statewide public office or a legislative office in this state, whether by election or appointment.

Article 2.1 Arizona State Library, Archives and Public Records Established in the Office of the Secretary of State

§ 41-151 Definitions

In this article, unless the context otherwise requires:

"Director" means the director of the state library.
"Records":

(a) Means all books, papers, maps, photographs or other documentary materials, regardless of physical form or characteristics, including prints or copies of such items produced or reproduced on film or electronic media pursuant to section 41-151.16, made or received by any governmental agency in pursuance of law or in connection with the transaction of public business and preserved or appropriate for preservation by the agency or its legitimate successor as evidence of the organization, functions, policies, decisions, procedures, operations or other activities of the government, or because of the informational and historical value of data contained in the record.

(b) Includes records that are made confidential by statute.

(c) Does not include library or museum material made or acquired solely for reference or exhibition purposes, extra copies of documents preserved only for convenience of reference and stocks of publications or documents intended for sale or distribution to interested persons.

"State library" means the Arizona state library, archives and public records.

§ 41-151.01 Arizona state library, archives and public records

A. The Arizona state library, archives and public records is established in the office of the secretary of state.

B. The state library shall:

Acquire and provide access to materials relating to the following in print, in an electronic format or in any other format:

(a) Law.

(b) Political science.

(d) Sociology.

(e) Subjects pertaining to the theory and practice of government.

(f) Genealogy.

(g) Arizona history.

Provide the following:

(a) A general and legal reference service.

(b) A records management and archives program.

(d) A library development service.

(e) Museums for educational purposes as approved by the secretary of state.

(f) A service, including materials, for persons who are visually or physically unable to use traditional print materials.

§ 41-151.02 Electronic records repository fund; exemption

A. The electronic records repository fund is established consisting of legislative appropriations, gifts, nonfederal grants, fees, donations and other monies. The director shall administer the fund. Monies in the fund are subject to legislative appropriation. The director shall use the monies in the fund for operating expenses for the trusted electronic records repository established pursuant to section 41-151.15.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-151.03 Director of the state library; qualifications

A. The state library is under the charge and control of a director, subject to supervision of the secretary of state. The secretary of state shall appoint the director of the state library. The director shall serve at the pleasure of the secretary of state.

B. The director shall be technically trained in library work with at least a master's degree in library science or the equivalent and have at least five years' actual experience as chief administrator of a major library.

§ 41-151.04 Compensation of director

The secretary of state shall determine the compensation of the director pursuant to section 38-611.

§ 41-151.05 Powers and duties of director

A. The director shall:

Adopt rules for the use of books or other materials in the custody of the state library and for the removal of books from the library, including assessing reasonable penalties for failure to return books or other materials when due. The proceeds from the assessment of reasonable penalties shall be deposited, pursuant to sections 35-146 and 35-147, in the state library fund established by section 41-151.06. The monies shall be used only for the purchase of other books or materials.
Sell or exchange undesired duplicate copies of books or other materials, or books or other materials not of value for the purposes of the library, or photographic reproductions of state library holdings, and deposit, pursuant to sections 35-146 and 35-147, the proceeds in the state library fund established by section 41-151.06. The monies shall be used for the purchase of other books or materials.
Bring actions for the recovery of books or other materials, or for three times the value of the books or other materials, against any person who has them in the person's possession or who is responsible for the books or other materials, and who has failed or refused to return them on demand. If a book or other material is one of a set, the value of the book or other material may be deemed the value of the entire set. The director shall deposit, pursuant to sections 35-146 and 35-147, monies recovered pursuant to this paragraph in the state library fund established by section 41-151.06.
Certify copies from books, documents or other archival or public records that have been deposited in the custody of the state library. The fee for certification shall be the same as prescribed for the certification of records by the secretary of state. The director shall deposit, pursuant to sections 35-146 and 35-147, these fees in the state library fund established by section 41-151.06. These certificates have the same force and effect as if made by the officer originally in charge of the record.
As the director deems necessary:

(a) Arrange with the federal government, other states and foreign countries for a system of exchange of official state reports and publications, session laws, statutes, legislative journals and supreme court reports.

(b) Enter into agreements to establish a depository system and an exchange program with any municipal, county or regional public library, state college or state university library and out-of-state research libraries.

(c) Enter into agreements with libraries in this state for the state documents program described in section 41-151.08, subsection A, paragraph 2. 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 may not use any monies received pursuant to the agreement to supplant other monies available to the library.

Adopt rules for the acquisition, maintenance, access and preservation of state publications.
After consultation with other agencies, adopt rules as provided by statute, including rules for:

(a) Describing state publications in all formats.

(b) Supervising county free libraries pursuant to section 11-910.

(d) Enforcing section 34-502.

Provide access to an official compilation or revision of the laws of this state to each public or court library in this state that applies for access. The director may provide the access electronically. On request, the director may provide a certified copy of a law pursuant to paragraph 4 of this subsection.
As part of the secretary of state's annual report to the governor, report on the condition of the state library, its activities and the disposition of monies spent for its maintenance.
Subject to chapter 4, article 4 of this title, appoint personnel, including security personnel, necessary to perform the duties of the state library and assign their duties.
Cooperate with the legislative council in carrying out section 41-1304, subsection B.

B. The governor, the secretary of state, the president of the senate, the speaker of the house of representatives, the heads of departments and all officers and agents of this state shall supply at no cost the number of copies of official reports, public documents and publications required for the state library or its agents to satisfy the requirements of the state documents program or arrangements or agreements entered into pursuant to subsection A, paragraph 5 of this section.

C. The governmental units described in subsection B of this section shall:

Notify the state library if the reports, documents and publications subject to this section are posted on an internet website.
Pay the state library the fee charged pursuant to section 41-151.12 if the governmental unit refuses the state library's request to supply, and the state library incurs any expenses in obtaining, the copies that are required to be supplied pursuant to this section.

§ 41-151.06 State library administrative agency; state library fund

A. The state library is the state library administrative agency, and the director may accept, on behalf of the state, any allocation of monies or materials made by the federal government for state library purposes, any appropriation of state monies for the purposes of this article or any bequest, grant or gift to the state library, and administer all of them under rules adopted by the director, unless otherwise provided by law. The administration may not be inconsistent with the conditions of the allocation, appropriation, bequest, grant or gift.

B. The state library fund is established. All monies received pursuant to this section and sections 28-2470.36 and 41-151.05, except for federal monies, shall be deposited, pursuant to sections 35-146 and 35-147, in the fund and accounted for separately. Monies in the accounts are continuously appropriated to the state library for the purposes provided for in the fund sources, and monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. All federal monies received as provided by this section shall be deposited, pursuant to sections 35-146 and 35-147, in a separate account of the fund and disbursed in the manner prescribed for the disbursement of state funds, but are not subject to section 35-190 relating to lapsing of appropriations.

§ 41-151.07 Library development services

The state library shall:

Direct and coordinate statewide public library services.
Encourage and assist the development of library services in state and local institutions and governmental units.
Compile and disseminate statistics and other data relating to libraries and library services.
Give professional advice and assistance in the establishment and operation of county free libraries, municipal or other libraries, or any combinations of county free and municipal or other libraries, and to joint ventures of public and private or nonprofit libraries in this state that make library information available to the public and that request such professional advice and assistance.
Develop library services for the blind and persons with physical disabilities regardless of the type of technology used.
Perform all other duties necessary or appropriate to the development of statewide library services.

§ 41-151.08 Archives and history services; recovery of costs

A. The state library shall contain:

All available works, books, newspaper files, pamphlets, papers, manuscripts, documents, magazines and newspaper articles, maps, pictures, items and materials pertaining to or bearing on the history of this state.
Copies of current official reports, public documents and publications of state, county and municipal officers, departments, boards, commissions, agencies and institutions, and public archives. To allow compliance with this paragraph, all public officers required by law shall report in writing to the governor, or to the governing officer or body of a county, city or town, to provide those reports, documents and publications to the state library for filing in the state library archives in the number that will satisfy the requirements of the state documents program or arrangements or agreements entered into pursuant to section 41-151.05, subsection A, paragraph 5 except those reports, documents and publications that are confidential.

B. The governmental units described in subsection A of this section shall:

Notify the state library if the reports, documents and publications subject to this section are posted on an internet website.
Pay the state library the fee charged pursuant to section 41-151.12 if the governmental unit refuses the state library's request to provide, and the state library incurs any expenses in obtaining, the copies that are required to be provided pursuant to this section.

§ 41-151.09 Depository of official archives

A. The state library is the central depository of all official books, records and documents, including electronic records, not in current use of the various state officers and departments of this state and the counties, cities and towns. These materials constitute the state archives. The state archives shall be carefully kept and preserved, classified, catalogued and made available for inspection under rules the director adopts.

B. State officers in possession of official state or territorial archives shall deposit those archives with the state library.

C. Any county, municipal or other public official shall retain or deposit with the state library for permanent preservation pursuant to section 39-101 official books, records, documents and original papers not in current use. The clerk of the superior court shall deposit and the state library shall preserve all permanent superior court case files pursuant to court rules.

D. The state library shall make birth and death records held in the state library archives available for inspection as follows:

Birth records if seventy-five years have passed after the date of birth as recorded on the birth certificate.
Death records if fifty years have passed after the date of death.

§ 41-151.10 Historical records

The state library shall:

Collect from the files of old newspapers, court records, church records, private collections and other sources, data pertaining to the history of this state.
Accept loans or gifts of rare volumes, manuscripts, maps, pictures and other articles or things of historical value.
Classify, edit, annotate and publish from time to time records considered of public interest.
Encourage the proper marking of points of historical importance.
Systematically stimulate historical research and encourage the study of Arizona history.

§ 41-151.11 Access to public records

The director, in person or through a deputy, has the right of reasonable access to all nonconfidential public records in this state, or any public office of this state or any county, city, district or political subdivision of this state, because of the historical and research value of data contained in those records, with a view to securing their safety and determining their need for preservation or disposal.

§ 41-151.12 Records; records management; powers and duties of director; fees; records services fund

A. The director is responsible for preserving and managing records. In addition to other powers and duties, the director shall:

Establish standards, procedures and techniques for effective management of records.
Make continuing surveys of recordkeeping operations and recommend improvements in current record management practices, including the use of space, equipment and supplies employed in creating, maintaining, storing and servicing records.
Establish standards and procedures for preparing schedules that provide for retaining records of continuing value and for prompt and orderly disposal of records no longer possessing sufficient administrative, legal or fiscal value to warrant their further keeping.
Establish criteria for designating essential records within the following general categories:

(a) Records containing information necessary to the operations of government in an emergency created by a disaster.

(b) Records containing information necessary to protect the rights and interests of persons or to establish and affirm the powers and duties of governments in the resumption of operations after a disaster.

Reproduce or cause to be reproduced essential records and prescribe the place and manner of their safekeeping.
Obtain such reports and documentation from agencies as are required for administering this program.
Request transmittal of the originals of records produced or reproduced by agencies of this state or its political subdivisions pursuant to section 41-151.16 or certified negatives, films or electronic media of such originals, or both, if in the director's judgment such records may be of historical or other value.
On request, assist and advise in the establishment of records management programs in the legislative and judicial branches of this state and provide program services similar to those available to the executive branch of state government pursuant to this article.
Establish a fee schedule to systematically charge state agencies, political subdivisions of this state and other governmental units of this state for services described in this section and section 41-151.13 and deposit, pursuant to sections 35-146 and 35-147, monies received from fees in the records services fund established by subsection B of this section.
Subject to approval of the secretary of state, establish a fee schedule to charge state agencies, political subdivisions of this state and other governmental units of this state for services and expenses incurred by the state library in obtaining copies of those reports, documents and publications that are required to be delivered, supplied or provided pursuant to sections 35-103, 41-151.05 and 41-151.08 and deposit, pursuant to sections 35-146 and 35-147, these monies in the records services fund established by subsection B of this section.

B. The records services fund is established consisting of monies deposited pursuant to subsection A, paragraphs 9 and 10 of this section. The director shall administer the fund for the purposes provided in subsection A of this section. Monies in the fund are subject to legislative appropriation and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-151.13 Records management officer; duties

A. The state library shall employ a records management officer who is responsible for the direction and control of the records management program. The records management officer, at the direction of the director, shall administer section 41-151.12.

B. The state library shall:

Through consultation and education, provide for an efficient and contemporary records management program using modern techniques to facilitate the efficient and economic creation, maintenance, control, retention and disposition of records.
Operate a records management center for maintaining and housing inactive nonarchival records. The records management center is the only inactive records center operated by a state agency. State agencies may use other facilities for inactive records storage with prior approval of the director.
Establish standards and procedures for records accepted for storage.
Operate a secure vault as part of the records management center for housing and maintaining micrographic, machine read and selected essential records.
Operate a preservation imaging function that is responsible for:

(a) The efficient and coordinated use of micrographics and digital imaging equipment, techniques and personnel to achieve optimum quality, effectiveness and economy in the production of source document micrographics and digital imaging.

(b) Processing and duplicating microfilm produced by the preservation imaging operation and film produced by other agencies of this state.

§ 41-151.14 State and local public records management; violation; classification; definition

A. The head of each state and local agency shall:

Establish and maintain an active, continuing program for the economical and efficient management of the public records of the agency.
Make and maintain records containing adequate and proper documentation of the organization, functions, policies, decisions, procedures and essential transactions of the agency designed to furnish information to protect the rights of this state and of persons directly affected by the agency's activities.
Submit to the director, in accordance with established standards, schedules proposing the length of time each record series warrants retention for administrative, legal or fiscal purposes after it has been received by the agency.
Once every five years submit to the director lists of all essential public records in the custody of the agency.
Cooperate with the director in the conduct of surveys.
Designate an individual within the agency to manage the records management program of the agency. The agency shall reconfirm the identity of this individual to the state library every other year. The designated individual:

(a) Must be at a level of management sufficient to direct the records management program in an efficient and effective manner.

(b) Shall act as coordinator and liaison for the agency with the state library.

Comply with rules, standards and procedures adopted by the director.

B. The governing body of each county, city, town or other political subdivision shall promote the principles of efficient records management for local public records. The governing body, as far as practicable, shall follow the program established for managing state records. The director, on request of the governing body, shall provide advice and assistance in establishing a local public records management program.

C. A head of a state or local agency who violates this section is guilty of a class 2 misdemeanor.

D. For the purposes of this section, "records management" means creating and implementing systematic controls for records and information activities from the point where they are created or received through final disposition or archival retention, including distribution, use, storage, retrieval, protection and preservation.

§ 41-151.15 Preservation of public records

A. All records made or received by public officials or employees of this state or the counties, cities and towns of this state in the course of their public duties are the property of this state. Except as provided in this article, the director and every other custodian of public records shall carefully protect and preserve the records from deterioration, mutilation, loss or destruction and, when advisable, shall cause them to be properly repaired and renovated. All paper, ink and other materials used in public offices for the purpose of permanent records, including electronic records, shall be of durable quality and shall comply with the standards established pursuant to section 39-101. Additionally, the custodian of records that keeps photography, film, microfiche, digital imaging or other types of reproduction or electronic media pursuant to section 41-151.16, subsection A shall protect records from loss or destruction pursuant to standards that are established by the director.

B. The state library shall establish, operate and maintain a trusted electronic records repository to keep, preserve, secure and make available the electronic and digitized records of the state archives and the state documents program and of any documents and public records received, subject to legislative appropriation.

C. Records may not be destroyed or otherwise disposed of by any agency of this state unless it is determined by the state library that the record has no further administrative, legal, fiscal, research or historical value. The original of any record produced or reproduced pursuant to section 41-151.16 may be determined by the state library to have no further administrative, legal, fiscal, research or historical value. A person who destroys or otherwise disposes of records without the specific authority of the state library is in violation of section 38-421.

§ 41-151.16 Production and reproduction of records by agencies of the state and political subdivisions; admissibility; violation; classification

A. Each agency of this state or of any political subdivision of this state may implement a program for the production or reproduction by photography or other method of reproduction on film, microfiche, digital imaging or other electronic media of records in its custody, whether obsolete or current, and classify, catalogue and index such records for convenient reference. The agency, before the institution of any such program of production or reproduction, shall obtain approval from the director of the types of records to be produced or reproduced and of the methods of production, reproduction and storage and the equipment which the agency proposes to use in connection with the production, reproduction and storage. Approval pursuant to this subsection is necessary for digitizing programs but not for individual instances of digitization. On approval from the director, the source documents may be destroyed, but only after an administrative audit and after safeguards are in place to protect the public records pursuant to section 41-151.15, subsection A.

B. Except as otherwise provided by law, records reproduced as provided in subsection A of this section are admissible in evidence.

C. A head of an agency of this state or a political subdivision of this state who violates this section is guilty of a class 2 misdemeanor.

§ 41-151.17 Duties relating to historical value

A. The state library shall:

Determine whether public records presented to it are of historical value.
Dispose of records determined to be of no historical value.
Accept those records deemed by a public officer having custody of the records to be unnecessary for transacting the business of the public officer's office and deemed to be of historical value.

B. The state library shall check all public records of any public office, on the termination of the existence and functions of the office, and either dispose of or transfer the records to the custody of the state library, in accordance with this article. If a public office is terminated or reduced by the transfer of its powers and duties to another office or to other offices, its appropriate public records shall pass with the powers and duties transferred.

§ 41-151.18 Arizona uniform laws commission; membership; duties

A. The Arizona uniform laws commission is established consisting of four members who are members of a state bar association and who are appointed by the governor. These members are in addition to the members who have attained life membership in the national conference of commissioners on uniform state laws. The term of office of the members is six years except for lifetime members. An appointment to fill a vacancy caused other than by expiration of a term is for the remainder of the unexpired term.

B. Members of the Arizona uniform laws commission are not eligible for compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

C. The Arizona uniform laws commission shall review efforts nationally to enact uniform laws and recommend to the governor and the legislature the adoption of uniform legislation that the commission deems desirable.

D. The secretary of state may maintain membership on the Arizona uniform laws commission. On or before October 1 of each year, the Arizona uniform laws commission shall submit a letter to each member of the legislature that includes a website link to the current list of the uniform acts that is prepared by the national conference of commissioners on uniform state laws for the purpose of informing the members of the legislature about current model legislation that is available to the legislators.

§ 41-151.19 Determination of value; disposition

Every public officer who has public records in the public officer's custody shall consult periodically with the state library and the state library shall determine whether the records in question are of legal, administrative, historical or other value. Those records determined to be of legal, administrative, historical or other value shall be preserved. Those records determined to be of no legal, administrative, historical or other value shall be disposed of by such a method as the state library may specify. A report of records destruction that includes a list of all records disposed of shall be filed at least annually with the state library on a form prescribed by the state library.

§ 41-151.20 Historical advisory commission; membership; terms; expenses; duties; historic sites review committee

A. The historical advisory commission is established consisting of members appointed by the director for staggered terms of three years ending on July 1. The commission membership of not less than ten nor more than twenty-five members shall consist of experts in the disciplines of history, arts and culture, architecture and archaeology, professional librarians and archivists or persons otherwise associated with interpreting, researching, writing, preserving or teaching this state's heritage, including the Indian nations' history and heritage, and the director of the Arizona historical society, the director of the state museum, the director of the Arizona state parks board, the director of the office of tourism or the director's designee, the superintendent of public instruction or the superintendent's designee and the state historic preservation officer.

B. Members shall serve without compensation but those employed by this state shall be reimbursed for travel and subsistence by the department or agency they represent and those who are not employed by this state are eligible for reimbursement of expenses by the commission pursuant to title 38, chapter 4, article 2.

C. The commission shall:

Advise the legislature and state agencies on matters relating to this state's history and historic preservation.
Recommend measures to the legislature and state agencies to coordinate or improve the effectiveness of activities of state agencies and agencies of the political subdivisions of this state and other persons relating to interpreting, researching, writing and teaching this state's history, heritage and historic preservation, including the Indian nations' history, heritage and preservation.
Advise the legislature and state agencies on disseminating information pertaining to activities relating to historic preservation as provided in paragraph 2 of this subsection.
Encourage, in cooperation with appropriate public and private agencies, the Indian nations and other persons, training and education in the field of interpreting, researching, writing and teaching this state's history, heritage and historic preservation.
Assist in establishing the Arizona register of heritage agriculture pursuant to section 3-162.
On September 30 of each year, submit a report of the commission's activities to the director for inclusion in the annual report of the state library.

D. The historic sites review committee consisting of nine members is established to serve as a standing committee of the historical advisory commission. The state historic preservation officer shall appoint committee members for staggered terms of three years ending on July 1. The state historic preservation officer may appoint persons other than commission members to serve on the committee and shall appoint at least five persons who are professionals qualified in the disciplines of history, prehistoric and historic archaeology, architectural history or architecture. The committee shall select annually at the first meeting a chairperson who is a commission member. The chairperson shall report on committee activities at commission meetings. The committee shall assist in the duties prescribed in this section and by federal law, review nominations to the national and state historic registers, provide general advice and guidance to the state historic preservation officer and perform other duties as are necessary. On or before September 1 of each year, the state historic preservation officer shall submit a report of the committee's activities to the governor, the president of the senate, the speaker of the house of representatives and the director, including information prescribed in sections 41-862 and 41-881.

§ 41-151.21 Review and transfer of certain historic property; exemption; definition

A. An agency shall notify the state library on forms prescribed by the director if the agency has or acquires furniture, equipment or other personal property that is fifty or more years of age or of known historical interest, including property escheated to this state under title 12, chapter 7, article 5.

B. The director may authorize a person to inspect the personal property reported under subsection A of this section and recommend to the state library whether the personal property is of an historic interest or value as would in the public interest require it to be made available permanently for placement on public display in any restored executive, legislative or judicial facility or museum area.

C. If the state library determines the personal property should be made available for display purposes, the state library shall provide written notice to the agency requesting prompt transfer of the personal property to the state library.

D. An agency may apply to the secretary of state for an exemption from the transfer required under subsection C of this section by filing a prompt written response stating:

The length of time the agency has used the personal property.
Why the value of the personal property to the agency is greater than the educational and historic value in displaying the personal property.
What harm the agency would suffer if the personal property is transferred to the state library.
That the use of federal monies in the initial acquisition of the personal property legally precludes its transfer to the state library.

E. The secretary of state shall grant an exemption to a requested property transfer if the secretary of state finds that the transfer of the property would result in significant cost or disruption to the agency that would outweigh the educational and historic value in displaying the property.

F. For the purposes of this section, "agency" means any branch, department, commission, board or other unit of the state organization that receives, disburses or spends state monies or incurs obligations against this state.

§ 41-151.22 Privacy of user records; violation; classification; definition

A. Except as provided in subsection B of this section, a library or library system supported by public monies may not allow disclosure of any record or other information, including e-books, that identifies a user of library services as requesting or obtaining specific materials or services or as otherwise using the library.

B. Records may be disclosed:

If necessary, for the reasonable operation of the library.
On written consent of the user.
On receipt of a court order.
If required by law.

C. Any person who knowingly discloses any record or other information in violation of this section is guilty of a class 3 misdemeanor.

D. For the purposes of this section, "e-book" means a book composed in or converted to digital format for display on a computer screen or handheld device.

§ 41-151.23 Arizona historical records advisory board

A. The Arizona historical records advisory board is established consisting of the director and at least six members appointed by the director. These members shall consist of recognized experts in administering government records, historical records or archives and shall be as broadly representative as possible of public and private archives, records offices and research institutions and organizations in this state.

B. Members appointed by the director pursuant to subsection A of this section shall serve three-year staggered terms beginning on July 1. If there is a vacancy, the director shall appoint another person to serve the remainder of the term. The director may appoint members to succeeding terms. The director may remove a member for good and sufficient cause.

C. The advisory board shall annually elect a chairperson and vice chairperson from among its members at the first meeting of the fiscal year. The director shall serve as secretary of the advisory board and shall maintain the records of the advisory board.

D. The director shall call quarterly meetings and the director or chairperson may call other meetings as the director or chairperson deems necessary. A member of the advisory board may send a designee to be an observer at advisory board meetings. The designee may not vote directly or as a proxy.

E. The advisory board shall:

Serve as the central advisory body for historical records planning and for national historical publications and records commission funded projects developed and carried out in this state.
Serve as a coordinating body to facilitate cooperation among historical records repositories and other information agencies in this state and as a state-level review body for grant proposals as defined in the national historical publications and records commission guidelines.

F. The advisory board may:

Sponsor and publish surveys of the conditions and needs of historical records in this state.
Solicit or develop proposals for projects to be carried out in this state with national historical publications and records commission grants.
Review proposals by institutions in this state and make recommendations about these proposals to the national historical publications and records commission.
Develop, revise and submit to the national historical publications and records commission this state's priorities for historical records projects according to guidelines developed by the national historical publications and records commission.
Promote an understanding of the role and value of historical records.
Act in an advisory capacity to the state archives and other statewide archival or records agencies.
Review, through reports and otherwise, the operation and progress of projects in this state that are financed by national historical publications and records commission grants.

G. Members of the advisory board are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

Article 3 Address Confidentiality Program

§ 41-161 Definitions

In this article, unless the context otherwise requires:

"Actual address" means a residential, work or school address as specified on the individual's application to be a program participant and includes the county and voting precinct number.
"Address confidentiality program" means the program established pursuant to this article in the office of the secretary of state to protect the confidentiality of the actual address of a relocated victim of domestic violence, a sexual offense or stalking.
"Applicant" means an individual identified as such in an application received by the secretary of state pursuant to section 41-163.
"Application assistant" means a person designated by the secretary of state to assist an applicant in the preparation of an application to participate in the address confidentiality program.
"Domestic violence" has the same meaning prescribed in section 13-3601.
"Program participant" means an individual accepted into the address confidentiality program.
"Public record" means all documents, papers, letters, maps, books, photographs, films, sound recordings, magnetic or other tapes, digital data, artifacts or other documentary material, regardless of physical form or characteristics, made or received pursuant to law or ordinance in connection with the transaction of public business by a state or local government entity.
"Sexual offense" means an offense included in title 13, chapter 14 or 35.1.
"Stalking" means an offense prescribed in section 13-2923.
"State or local government entity" means every elected or appointed state or local public office, public officer or official, board, commission, bureau, committee, council, department, authority, agency, institution of higher education or other unit of the executive, legislative or judicial branch of this state or any city, town, county, public school or other kind of municipal, quasi-municipal or public corporation but does not include an agricultural improvement district.
"Substitute address" means an address that is designated by the secretary of state under the address confidentiality program and that is used instead of an actual address.

§ 41-162 Address confidentiality; duties of secretary of state; application assistant

A. On or before December 31, 2012, the secretary of state shall establish the address confidentiality program to allow persons who have been subjected to domestic violence offenses, sexual offenses or stalking to keep their residence addresses confidential and not accessible to the general public. Participants in the program shall receive a substitute address that becomes the participant's lawful address of record.

B. The secretary of state shall:

Designate a substitute address for a program participant that is used by state and local government entities as set forth in this section.
Receive mail sent to a program participant at a substitute address and forward the mail to the program participant as set forth in paragraph 3 of this subsection.
Receive first-class, certified or registered mail on behalf of a program participant and forward the mail to the program participant for no charge. The secretary of state may arrange to receive and forward other classes or kinds of mail at the program participant's expense. The secretary of state is not required to track or otherwise maintain records of any mail received on behalf of a program participant unless the mail is certified or registered mail.

C. Notwithstanding any other law and except as provided by court rule, a program participant may be served by registered mail or by certified mail, return receipt requested, addressed to the program participant at the program participant's substitute address with any process, notice or demand required or allowed by law to be served on the program participant. This subsection does not prescribe the only means, or necessarily the required means, of serving a program participant in this state.

D. The secretary of state may designate as an application assistant any person who:

Provides counseling, referral or other services to victims of domestic violence, a sexual offense or stalking.
Completes any training and registration process required by the secretary of state.

E. Any assistance and counseling rendered by the secretary of state or an application assistant to an applicant related to this section is not legal advice.

§ 41-163 Filing and certification of applications; authorization cards

A. On the recommendation of an application assistant, an individual may apply to the secretary of state to participate in the address confidentiality program. The following individuals may apply to the secretary of state to have an address designated by the secretary of state to serve as the substitute address of the individual and any individuals identified pursuant to subsection C, paragraph 10 of this section:

An adult individual.
A parent or guardian acting on behalf of a minor if the minor resides with the individual.
A guardian acting on behalf of an incapacitated individual.

B. An application assistant shall assist the individual in the preparation of the application. The application shall be dated, signed and verified by the applicant and shall be signed and dated by the application assistant who assisted in the preparation of the application. The signature of the application assistant serves as the recommendation by the application assistant that the applicant have an address designated by the secretary of state to serve as the substitute address of the applicant. A minor or incapacitated individual on whose behalf a parent or guardian completes an application pursuant to the authority set forth in subsection A, paragraph 2 or 3 of this section is considered the applicant, but any statements that are required to be made by the applicant shall be made by the parent or guardian acting on behalf of the minor or incapacitated individual.

C. The application shall be on a form prescribed by the secretary of state and shall contain all of the following:

The applicant's name.
A statement by the applicant that the applicant is a victim of domestic violence, a sexual offense or stalking and that the applicant fears for the applicant's safety.
Evidence that the applicant is a victim of domestic violence, a sexual offense or stalking. This evidence shall include at least one of the following:

(a) Law enforcement, court or other state or local government entity or federal agency records or files.

(b) Documentation from a domestic violence program or facility, including a battered women's shelter or safe house, if the applicant is alleged to be a victim of domestic violence.

(d) Documentation from a religious, medical or other professional from whom the applicant has sought assistance in dealing with the alleged domestic violence, sexual offense or stalking.

A statement by the applicant that disclosure of the applicant's actual address would endanger the applicant's safety.
A statement by the applicant that the applicant has confidentially relocated in the past ninety days or will confidentially relocate in this state.
A designation of the secretary of state as an agent for the applicant for purposes of receiving service of process and first class, election, registered and certified mail.
The mailing address and telephone number where the applicant can be contacted by the secretary of state.
The actual address that the applicant requests not to be disclosed by the secretary of state and that directly relates to the increased risk of domestic violence, a sexual offense or stalking.
A statement as to whether there is any existing court order or court action involving the applicant or an individual identified pursuant to paragraph 10 of this subsection related to dissolution of marriage proceedings, child support or the allocation of parental responsibilities or parenting time. The statement shall include the name of the court that issued the order or that has jurisdiction over the action, the case number and the judge assigned to the case.
The name of any person who resides with the applicant and who also needs to be a program participant in order to ensure the safety of the applicant and, if the person named in the application is eighteen years of age or older, the consent of the person to be a program participant.
A statement by the applicant, under penalty of perjury, that to the best of the applicant's knowledge, the information contained in the application is true.

D. On determining that an application is properly completed, the secretary of state shall certify the applicant and any individual who is identified pursuant to subsection C, paragraph 10 of this section as program participants. On certification, the secretary of state shall issue to the program participant an address confidentiality program authorization card, which shall include the program participant's substitute address. The card remains valid while the program participant remains certified under the program.

E. Applicants and individuals identified pursuant to subsection C, paragraph 10 of this section are certified for five years following the date of filing unless the certification is withdrawn or canceled before the end of the five-year period. A program participant may withdraw the certification by filing a request for withdrawal acknowledged before a notary public. A certification may be renewed by filing a renewal application with the secretary of state at least thirty days before the expiration of the current certification. The renewal application shall be dated, signed and verified by the applicant. The renewal application shall contain:

Any statement or information that is required by subsection C of this section and that has changed from the original application or a prior renewal application.
A statement by the applicant, under penalty of perjury, that to the best of the applicant's knowledge, the information contained in the renewal application and a prior application is true.

§ 41-164 Change of name, address or telephone number; cancellation of certification

A. A program participant shall notify the secretary of state within thirty days after the program participant has obtained a legal name change by providing the secretary of state a certified copy of any judgment or order evidencing the change or any other documentation the secretary of state deems to be sufficient evidence of the name change.

B. A program participant shall notify the secretary of state of a change in address or telephone number from the address or telephone number listed for the program participant on the application pursuant to section 41-163, subsection C no later than seven days after the change occurs.

C. The certification of a program participant shall be canceled under any of the following circumstances:

The program participant files a request for withdrawal of the certification pursuant to section 41-163, subsection E.
The program participant fails to notify the secretary of state of a change in the program participant's name, address or telephone number listed on the application pursuant to this section.
The program participant or parent or guardian who completes an application on behalf of an applicant knowingly submitted false information in the program application.
Mail forwarded to the program participant by the secretary of state is returned as undeliverable.

D. If the secretary of state determines that there is one or more grounds for canceling certification of a program participant pursuant to subsection C of this section, the secretary of state shall send notice of cancellation to the program participant. The notice of cancellation shall set forth the reasons for cancellation. The program participant has thirty days to appeal the cancellation decision under rules adopted by the secretary of state.

E. An individual who ceases to be a program participant is responsible for notifying any person, state or local government entity or business that uses the substitute address that the designated substitute address is no longer valid.

§ 41-165 Disclosure of actual address prohibited; violation; classification

A. The secretary of state shall not disclose any address or telephone number of a program participant other than the substitute address designated by the secretary of state, except under any of the following circumstances:

The information is required by direction of a court order, except that any person to whom a program participant's address or telephone number has been disclosed shall not disclose the address or telephone number to any other person unless permitted to do so by order of the court or as otherwise provided by law.
The secretary of state grants a request by a state or local government entity pursuant to section 41-167, subsection D.

B. The secretary of state shall provide immediate notification of disclosure to a program participant if disclosure is made pursuant to subsection A of this section.

C. If, at the time of application, an applicant or an individual identified pursuant to section 41-163, subsection C, paragraph 10 is subject to a court order related to dissolution of marriage proceedings, child support or the allocation of parental responsibilities or parenting time, the secretary of state shall notify the court that issued the order of the certification of the program participant in the address confidentiality program and the substitute address designated by the secretary of state. If, at the time of application, an applicant or an individual identified pursuant to section 41-163, subsection C, paragraph 10 is involved in a court action related to dissolution of marriage proceedings, child support or the allocation of parental responsibilities or parenting time, the secretary of state shall notify the court having jurisdiction over the action of the certification of the applicant in the address confidentiality program and the substitute address designated by the secretary of state.

D. A person shall not intentionally or knowingly obtain a program participant's actual address or telephone number from the secretary of state or a state or local government entity knowing that the person is not authorized to obtain the address information.

E. An employee of the secretary of state or a state or local government entity shall not intentionally or knowingly disclose a program participant's actual address or telephone number unless the disclosure is permissible by law. This subsection only applies if an employee obtains a program participant's actual address or telephone number during the course of the employee's official duties and, at the time of disclosure, the employee has specific knowledge that the actual address or telephone number disclosed belongs to a program participant.

F. Any person who intentionally or knowingly obtains or discloses information in violation of this section is guilty of a class 1 misdemeanor.

§ 41-166 Address use by state or local government entities

A. The program participant, and not the secretary of state, is responsible for requesting that a state or local government entity use the program participant's substitute address as the program participant's residential, work or school address for all purposes for which the state or local government entity requires or requests the residential, work or school address.

B. Except as otherwise provided in this section or unless the secretary of state grants a state or local government entity's request for disclosure pursuant to section 41-167, if a program participant submits a current and valid address confidentiality program authorization card to the state or local government entity, the state or local government entity shall accept the substitute address designation on the card as the program participant's address for use as the program participant's residential, work or school address when creating a new public record. The substitute address given to the state or local government entity is considered the last known address for the program participant used by the state or local government entity until the time that the state or local government entity receives notification pursuant to section 41-164. The state or local government entity may make a photocopy of the card for the records of the state or local government entity and shall immediately return the card to the program participant.

C. Except as otherwise provided in this section or by order of the court, if a program participant submits a current and valid address confidentiality program authorization card to the court, the court shall accept the substitute address designation on the card as the program participant's address for use as the program participant's residential, work or school address. The substitute address given to the court is considered the last known address for the program participant used by the court until the time that the court receives notification pursuant to section 41-164. The court may make a photocopy of the card for the court file and shall return the card to the program participant.

D. When a person with an existing voter registration record becomes a program participant, the secretary of state shall secure the participant's voter registration record and notify the appropriate county recorder of the participant's secured status, current residence address and substitute address for the county recorder to revise the participant's voter registration record so that the participant's address can be kept confidential in the same manner as prescribed by section 16-153. A program participant who is not already registered to vote may register to vote using the substitute address and must provide the election official with the participant's actual residence address for precinct designation purposes. If the participant registers to vote other than online or at a driver license examination facility, the participant shall present a completed voter registration form with the participant's substitute address and address confidentiality program card to the appropriate election official.

E. A designated election official shall use the actual address of a program participant for precinct designation and all official election-related purposes and shall keep the program participant's actual address confidential from the public. The election official shall use the substitute address for all correspondence and mailings placed in the United States mail. The substitute address shall not be used as an actual residence address for voter registration.

F. A state or local government entity's access to a program participant's voter registration shall be governed by the disclosure process set forth in section 41-167.

G. A program participant who completes an application to register to vote at a driver license examination facility while receiving a driver license or an identification card is required to have the program participant's actual address on the driver license or identification card. A program participant whose driver license has the substitute address may register to vote, if otherwise eligible, pursuant to subsection E of this section.

H. The substitute address shall not be used for purposes of listing, appraising or assessing property taxes and collecting property taxes. If a program participant would like to keep records maintained by the county assessor and county treasurer confidential, the program participant shall comply with section 11-484.

I. If a program participant is required by law to swear or affirm to the program participant's address, the program participant may use the participant's substitute address.

J. The substitute address shall not be used for purposes of assessing any taxes or fees on a motor vehicle or for titling or registering a motor vehicle. Notwithstanding any law to the contrary, any record that includes a program participant's actual address pursuant to this subsection shall be confidential and not available for inspection by anyone other than the program participant.

K. The substitute address shall not be used on any document related to real property recorded with a recorder. If a program participant would like to keep real property records confidential, the program participant shall comply with section 11-483.

L. A public school shall accept the substitute address as the address of record and shall verify student enrollment eligibility through the secretary of state. The secretary of state shall facilitate the transfer of student records from one school to another.

M. Except as otherwise provided in this section, a program participant's actual address and telephone number maintained by a state or local government entity or disclosed by the secretary of state is not a public record that is subject to inspection. This subsection shall not apply to the following:

Any public record created more than ninety days before the date that the program participant applied to be certified in the program.
A program participant who voluntarily requests that a state or local government entity use the participant's actual address or voluntarily gives the actual address to the state or local government entity.

N. For any public record created within ninety days before the date that a program participant applied to be certified in the program, a state or local government entity shall redact the actual address from a public record or change the actual address to the substitute address in the public record, if a program participant who presents a current and valid program authorization card requests the entity that maintains the public record to use the substitute address instead of the actual address on the public record.

§ 41-167 Request for disclosure

A. Except as otherwise provided by law, a state or local government entity requesting disclosure of a program participant's actual address pursuant to this section shall make the request in writing on the entity's letterhead and shall provide the secretary of state with the following information:

The name of the program participant for whom the state or local government entity seeks disclosure of the actual address.
A statement, with explanation, setting forth the reason that the state or local government entity needs the program participant's actual address and a statement that the state or local government entity cannot meet its statutory or administrative obligations without disclosure of the program participant's actual address.
A particular statement of facts showing that other methods to locate the program participant or the program participant's actual address have been tried and have failed or that the methods reasonably appear to be unlikely to succeed.
A statement that the state or local government entity has adopted a procedure setting forth the steps the state or local government entity will take to protect the confidentiality of the program participant's actual address.
Any other information as the secretary of state may reasonably request in order to identify the program participant in the records of the secretary of state.

B. The secretary of state shall provide the program participant with notice of a request for disclosure received pursuant to subsection A, and, to the extent possible, the participant shall be afforded an opportunity to be heard regarding the request.

C. Except as otherwise provided in subsection D, the secretary of state shall provide the program participant with written notification if a request for a disclosure is granted or denied pursuant to this section.

D. A notice or opportunity to be heard shall not be provided to the program participant if the request for disclosure is made by a state or local law enforcement agency conducting a criminal investigation involving alleged criminal conduct by the program participant or if providing notice to the program participant would jeopardize an ongoing criminal investigation or the safety of law enforcement personnel.

E. The secretary of state shall promptly conduct a review of all requests received pursuant to this section. The director of the address confidentiality program, or the director's designee, shall ensure that state and local government entities have twenty-four hour access to the director or the director's designee for the purposes of a request for disclosure. In conducting a review, the secretary of state shall consider all information received pursuant to subsection A, paragraphs 1 and 2 and any other appropriate information that the secretary of state may require.

F. The secretary of state shall grant a state or local government entity's request for disclosure and disclose a program participant's actual address pursuant to this section if:

The state or local government entity has a bona fide statutory or administrative need for the actual address.
The actual address will only be used for the purpose stated in the request.
Other methods to locate the program participant or the program participant's actual address have been tried and have failed or the methods reasonably appear to be unlikely to succeed.
The state or local government entity has adopted a procedure for protecting the confidentiality of the actual address of the program participant.

G. On granting a request for disclosure pursuant to this section, the secretary of state shall provide the state or local government entity with the disclosure that contains:

The program participant's actual address.
A statement setting forth the permitted use of the actual address and the names or classes of persons permitted to have access to and use of the actual address.
A statement that the state or local government entity is required to limit access to and use of the actual address to the permitted use and persons set forth in the disclosure.
The date on which the permitted use expires, if expiration is appropriate, after which the state or local government entity may no longer maintain, use or have access to the actual address.

H. A state or local government entity whose request is granted by the secretary of state pursuant to this section shall:

Limit the use of the program participant's actual address to the purposes set forth in the disclosure.
Limit the access to the program participant's actual address to the persons or classes of persons set forth in the disclosure.
Cease to use and dispose of the program participant's actual address on the expiration of the permitted use, if applicable.
Except as otherwise set forth in the disclosure, maintain the confidentiality of a program participant's actual address.

I. On denial of a state or local government entity's request for disclosure, the secretary of state shall provide prompt written notification to the state or local government entity stating that the state or local government entity's request has been denied and setting forth the specific reasons for the denial.

J. A state or local government entity may file written exceptions with the secretary of state no more than fifteen days after written notification is provided pursuant to subsection I. The exceptions shall restate the information contained in the request for disclosure, state the grounds on which the state or local government entity asserts that the request for disclosure should be granted and specifically respond to the secretary of state's specific reasons for denial.

K. Unless the state or local government entity filing exceptions agrees otherwise, the secretary of state shall make a final determination regarding the exceptions within thirty days after the filing of exceptions pursuant to subsection J. Before making a final determination regarding the exceptions, the secretary of state may request additional information from the state or local government entity or the program participant and conduct a hearing. If the final determination of the secretary of state is that the denial of the state or local government entity's request for disclosure was properly denied, the secretary of state shall provide the state or local government entity with written notification of this final determination stating that the state or local government entity's request has again been denied and setting forth the specific reasons for the denial. If the final determination of the secretary of state is that the denial of the state or local government entity's request for disclosure has been improperly denied, the secretary of state shall grant the state or local government entity's request for disclosure in accordance with this section. The final determination of the secretary of state shall constitute final entity action.

L. The record before any judicial review of a final entity action pursuant to subsection K shall consist of the state or local government entity's request for disclosure, the secretary of state's written response, the state or local government entity's exceptions, the hearing transcript, if any, and the secretary of state's final determination.

M. During any period of review, evaluation or appeal, the state or local government entity, to the extent possible, shall accept and use the program participant's substitute address.

N. Notwithstanding any other provision of this section, the secretary of state shall establish an expedited process for disclosure to be used by a court, clerk of the court, criminal justice official or agency or a probation department for situations where disclosure is related to a criminal proceeding or investigation involving a program participant or any other court proceeding. An official or agency receiving information pursuant to this subsection shall certify to the secretary of state that the official or agency has a system in place to protect the confidentiality of a program participant's actual address from the public and from personnel who are not involved in the trial, hearing, proceeding or investigation.

O. This section does not prevent the secretary of state from granting a request for disclosure to a state or local government entity pursuant to this section on receipt of a program participant's written consent to do so.

§ 41-168 Nondisclosure of address in court proceedings

A court or administrative tribunal may seal the portion of any record that contains a program participant's actual address. This section does not prevent a state or local government entity, in its discretion, from using a program participant's actual address in any document or record filed with a court or administrative tribunal if, at the time of filing, the document or record is not a public record.

§ 41-169 Address confidentiality program fund

A. The address confidentiality program fund is established consisting of assessments collected pursuant to section 12-116.05.

B. The secretary of state shall administer the fund and spend monies in the fund in order to defray the cost of the administration of the address confidentiality program.

C. On notice from the secretary of state, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

D. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

Article 4 The State Treasurer

§ 41-171 Office; absence from state; salary; seal

A. The state treasurer shall keep his office at the capitol and shall not absent himself from this state without first notifying the secretary of state that he is leaving. He is eligible to receive an annual salary pursuant to section 41-1904.

B. The secretary of state shall procure and deliver to the treasurer a seal of office containing the words "office of the state treasurer, Arizona", a description of which shall be retained by the secretary of state in his office.

§ 41-172 Powers and duties; administering oaths; appointment of deputy state treasurer

A. The state treasurer shall:

Authenticate writings and documents certified by the state treasurer with the seal of the state treasurer's office.
Receive and keep in secure custody all monies that belong to this state and that are not required to be received and kept by some other person.
File and keep the documentation delivered to the treasurer when monies are deposited into the treasury.
Deliver to each person depositing money into the treasury a confirmation showing the date, amount and depositing agency and shall provide a unique identifying number for each confirmation.
Pay warrants drawn by the department of administration in the order in which they are presented.
Keep an account of all monies received and disbursed, and keep separate accounts of the different funds and appropriations of monies.
Give information in writing as to the condition of the state treasury, or on any subject relating to the duties of the treasurer, at the request of a member of the legislature.
Deliver to the governor and the department of administration, monthly, an accurate statement of receipts and expenditures of public monies for the preceding month, containing a complete exhibit of all the public monies received and paid from the state treasury, showing, under separate heads, on what accounts and from what sources received, and for what particular object or service the monies have been paid. The treasurer shall deliver to the governor a similar statement on or before November 1 each year for the preceding fiscal year. The statement shall also include an estimate of the invested balance, including the general fund share of that balance as of June 30 of the preceding fiscal year. The statements are public records available for inspection at the office of the state treasurer.
On or before February 1 of each year, in coordination with the director of the department of administration, submit to the joint legislative budget committee a report explaining any differences between the department of administration's estimate of the previous fiscal year's state general fund ending balance submitted pursuant to section 35-131 and the state treasurer's estimate of the invested balance, including the state general fund share of that balance as of June 30 of the previous fiscal year submitted pursuant to paragraph 8 of this subsection.
Exercise those specific powers of the surveyor-general as a member of the selection board established under section 37-202.
Administer AZ529, Arizona's education savings plan established by title 15, chapter 14, article 7.
Promote and raise awareness of financial literacy to residents of this state.

B. The state treasurer may administer all oaths prescribed by law in matters touching the duties of the office of the state treasurer, subject to chapter 4, article 4 of this title, may appoint a deputy state treasurer, may qualify and select investment managers or advisors pursuant to section 35-318 and shall perform other duties required by other laws of this state.

C. Employees of the state treasurer's office are subject to chapter 4, article 4 of this title. For prospective or current employees of the state treasurer's office, the state treasurer may:

Require the submission of a full set of fingerprints for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.
Conduct a periodic review of credit standing.

§ 41-173 Special olympics tax refund fund

A. The special olympics tax refund fund is established consisting of contributions to the special olympics Arizona as a corporation from income tax refunds collected pursuant to section 43-614, other unrestricted private gifts and grants and investment earnings. No public monies may be appropriated to or designated for this fund.

B. The fund shall be administered by the department of revenue. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. Before December 31 each year the department of revenue shall determine the cost of administering the special olympics income tax refund checkoff under section 43-614 and this section and shall deduct this amount from monies otherwise distributable to the special olympics Arizona as a corporation. The deducted monies shall be deposited, pursuant to sections 35-146 and 35-147, in the state general fund. If the amount to be deducted for administrative cost exceeds the amount distributable, the excess deduction shall be carried forward as a liability to the special olympics Arizona as a corporation until paid. On May 15 and October 15 each year the department of revenue shall distribute all monies in the fund not necessary for administrative costs to the department of economic security to be used only to contract with the special olympics Arizona as a corporation for delivery of those services essential to programs of the special olympics Arizona as a corporation or its successor for the citizens of Arizona with intellectual disabilities, including coordination and development of such programs within this state.

D. Monies contributed or accruing to the fund are not state revenues for purposes of any constitutional limitation or prohibition and are exempt from lapsing under section 35-190.

§ 41-174 Access to public records and state offices

The state treasurer shall have free access to the office of the department of administration for the inspection of all books, accounts and papers of the department and free access to all other offices of the state for the inspection of books, accounts and papers which concern any of his duties.

§ 41-175 State treasurer's financial literacy fund

The state treasurer's financial literacy fund is established consisting of monies appropriated by the legislature and any other monies available from any lawful public or private source to promote financial literacy in this state. The state treasurer shall administer the fund and shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-176 Navajo-Hopi land dispute county settlement fund; investment; distribution; exemption

A. A Navajo-Hopi land dispute county settlement fund is established consisting of the monies received by this state from the United States as a result of the Navajo-Hopi land dispute settlement act of 1996 (25 United States Code section 640(d)-NOTE).

B. The state treasurer shall administer the fund as a continuing appropriation and shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. In consultation with the counties, each year the state treasurer shall pay to each county a share of the fund monies earned from investment based on the percentage of total land in each county that is owned by the Hopi tribe that is removed from the county tax rolls as a result of the Navajo-Hopi land dispute settlement act of 1996 (25 United States Code section 640(d)-NOTE).

D. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-177 Arizona health innovation trust fund; purpose; annual report

A. The Arizona health innovation trust fund is established. The state treasurer shall administer the trust fund as trustee.

B. The trust fund is a permanent endowment fund that consists of monies appropriated by the legislature, earnings from the fund and gifts or grants donated or given to the fund.

C. Monies in the trust fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

D. The state treasurer shall accept, separately account for and hold in trust any trust fund monies deposited pursuant to this section in the state treasury, which are considered to be trust monies as defined in section 35-310 and which may not be commingled with any other monies in the state treasury except for investment purposes. The state treasurer shall invest and divest, as provided by sections 35-313 and 35-314.03, any trust fund monies deposited in the state treasury, and monies earned from interest and investment income shall be credited to the trust fund.

E. The state treasurer shall annually allocate four percent of the monies in the trust fund to an entity that satisfies all of the following requirements:

Is a charitable organization that is qualified under section 501(c)(3) of the United States internal revenue code for federal income tax purposes.
Provides entrepreneurial education, mentoring and support to persons in the health innovation and health care delivery sectors in this state.
Provides workforce development programs designed to support the talent requirements of employers in the health innovation and health care delivery sectors in this state.
Provides programs that support the development and commercialization of health innovation by businesses that are based in this state and that employ not more than one hundred employees.
Has entered into an endowment agreement with the state treasurer that includes investment procedures, maturity timelines and other requirements established by the state treasurer and entity reporting requirements, which must include how distributions from the trust fund are used and the social and economic impact of the use.

F. On or before December 31 of each year, the entity shall submit the report as prescribed by the treasurer to the governor, the president of the senate, the speaker of the house of representatives and the state treasurer and shall provide a copy of this report to the secretary of state.

§ 41-178 Distribution of notary bond fees

The state treasurer shall transmit, distribute or deposit all monies received pursuant to section 41-126, subsection A, paragraphs 11 and 12 as follows:

1.31 percent for deposit in the resource center fund established by and for the purposes of section 41-2402, subsection G.
8.87 percent for deposit in the domestic violence services fund established by section 36-3002.
1.93 percent for deposit in the child abuse prevention fund established by section 8-550.01.
7.62 percent for proportional deposit in each county's law library fund established by section 12-305, based on the number of notaries commissioned per county.
0.35 percent for deposit in the alternative dispute resolution fund established by section 12-135.
23.79 percent for deposit in the elected officials' retirement plan fund established by section 38-802, which shall be distributed to the fund pursuant to section 38-810.
17.07 percent for deposit in the judicial collection enhancement fund established by section 12-113.
0.26 percent for deposit in the confidential intermediary and fiduciary fund established by section 8-135.
31.29 percent for deposit in the notary bond fund established by section 41-314.
7.51 percent shall be distributed to the county where the notary is commissioned in the same manner as the seven dollars of the time payment fee prescribed by section 12-116, subsection B.

§ 41-179 AZ529, Arizona's education savings plan advisory committee; membership; duties

A. The state treasurer shall appoint the AZ529, Arizona's education savings plan advisory committee to assist the treasurer in promoting and raising awareness of AZ529, Arizona's education savings plan established by title 15, chapter 14, article 7 to residents of this state, with emphasis on increasing access to the plan among economically disadvantaged, minority and underrepresented student populations. The advisory committee shall include all of the following:

The state treasurer or the state treasurer's designee, who serves as chairperson of the committee.
Two members or the members' designees who represent community college districts in this state, one of whom represents a community college district in a county with a population of five hundred thousand persons or more and one of whom represents a community college district in a county with a population of less than five hundred thousand persons.
One member or the member's designee who represents a university under the jurisdiction of the Arizona board of regents.
One member or the member's designee who represents an accredited private educational institution in this state offering associate, baccalaureate or higher degrees.
One member or the member's designee who represents an accredited private educational institution offering private vocational training in this state.
One member or the member's designee who represents an accredited private school or organization offering instruction to pupils in any combination of kindergarten programs or grades one through twelve in this state.
One member or the member's designee who is a teacher and who currently provides classroom instruction in this state.
One member or the member's designee who represents a federally recognized Indian tribe in this state.
One member or the member's designee who represents a United States department of labor-approved apprenticeship program.
Three public members or the members' designees who are residents of this state, including both of the following:

(a) At least one of whom represents a nonprofit organization that is exempt from taxation under section 501(c)(3) of the internal revenue code and that is based in this state.

(b) At least one of whom has financial planning experience.

B. The committee shall do both of the following:

Assist and make recommendations to the state treasurer regarding promotional and informational activities relating to AZ529, Arizona's education savings plan.
Meet at least once each calendar quarter. A majority of the membership constitutes a quorum for the transaction of business.

C. Committee members are not eligible to receive compensation or reimbursement of expenses.

D. The state treasurer's office shall provide necessary staff services to the committee.

§ 41-180 Bitcoin and digital assets reserve fund; definitions

A. The bitcoin and digital assets reserve fund is established consisting of any airdrops, staking rewards or interest earned as prescribed in section 44-308, subsection D. The state treasurer shall administer the fund. Monies in the fund are subject to the legislative appropriation. The rewards received from staking the digital asset may be in the form of digital assets.

B. On approval of the legislature, the state treasurer shall deposit, pursuant to sections 35-146 and 35-147, ten percent of the digital assets held in the fund in the state general fund. The legislature may not deposit bitcoin in the state general fund.

C. For the purposes of this section:

"Airdrop":

(a) Means to issue a unit of a digital asset that is distributed in a broad, equipped and nondiscretionary manner based on conditions that are capable of being satisfied by a participant in a blockchain system as incentive-based rewards, including any of the following:

(i) To users of a digital asset or any blockchain system to which the digital asset relates.

(ii) For activities that are directly related to the operation of the blockchain system, including mining, validating, staking and any other activity that is directly tied to the operation of the blockchain system.

(iii) To existing holders of another digital asset in proportion to the total units of the other digital assets that are held by each person.

(b) Does not include an exchange of more than a nominal value of cash, property or other assets.

"Digital assets" means any of the following that confers economic, proprietary or access rights or powers:

(a) Virtual currencies.

(b) Cryptocurrencies.

"Stake" means committing digital assets to a blockchain network to participate in the blockchain network's operations by validating transactions, proposing and attesting to blocks and securing the network.

Article 5 The Attorney General and the Department of Law

§ 41-191 Attorney general; qualifications; salary; assistants; fees; exceptions; outside counsel

A. The attorney general shall have been for not less than five years immediately preceding the date of taking office a practicing attorney before the supreme court of the state. He is entitled to receive an annual salary pursuant to section 41-1904.

B. The attorney general and his assistants shall devote full time to the duties of the office and shall not directly or indirectly engage in the private practice of law or in an occupation conflicting with such duties, except:

Such prohibition shall not apply to special assistants, except that in no instance shall special assistants engage in any private litigation in which the state or an officer thereof in his official capacity is a party.
Assistant attorney general may, but in no circumstances shall be required to, represent private clients in pro bono, private civil matters under the following circumstances:

(a) The representation will be conducted exclusively during off hours or while on leave and the attorney will not receive any compensation for such services.

(b) The client is not seeking an award of attorney fees for the services.

(c) The services are for an individual in need of personal legal services who does not have the financial resources to pay for the professional services or for a nonprofit, tax exempt charitable organization formed for the purpose of providing social services to individuals and families.

(d) The representation will not interfere with the performance of any official duties.

(e) The subject matter of pro bono representation is outside of the area of practice to which the attorney is assigned in the attorney general's office and the activity will not appear to create a conflict of interest.

(f) The activity will not reflect adversely on this state or any of its agencies.

(g) The assistant attorney general's position will not influence or appear to influence the outcome of any matter.

(h) The activity will not involve assertions that are contrary to the interest or position of this state or any of its agencies.

(i) The activity does not involve a criminal matter or proceeding or any matter in which this state is a party or has a direct or substantial interest.

(j) The activity will not utilize resources that will result in a cost to this state or any of its agencies.

(k) The attorney's supervisor may require the attorney to submit a prior written request to engage in pro bono work which includes a provision holding the agency harmless from any of the work undertaken by the attorney.

Notwithstanding any provision of law or rule to the contrary, representation by an attorney of a pro bono client shall not disqualify the office from subsequently participating in any action affecting the client.

C. The attorney general may also, within the limits of appropriations made therefor, employ attorneys for particular cases upon a fixed fee basis who shall be exempt from the restrictions imposed by this section upon regular or special assistants.

D. The attorney general may also, in suits to enforce state or federal statutes pertaining to antitrust, restraint of trade, or price-fixing activities or conspiracies, employ counsel on a fixed fee basis, not to exceed an hourly rate of fifty dollars per hour, such fee to be contingent upon and payable solely out of the recovery obtained in suits so instituted, except that where the court in which the case is pending has the authority to set a fee in conjunction with a given case, and does so set a fee, the court awarded fee shall be paid in lieu of the fee provided in this section. Employment and payment of counsel under this subsection shall not be subject to the limitations imposed by title 35, nor shall counsel so employed be subject to the limitations on private practice or litigation imposed upon regular or special assistants.

E. If the attorney general determines that legal action is reasonably necessary in order to collect a debt owed to this state or its agencies, boards, departments or commissions, the attorney general may retain or employ counsel to collect the debt. Counsel retained or employed by the attorney general shall account for the entire amount collected. A person retained as counsel under this subsection is not subject to the limitations on private practice or litigation applicable to regular or special assistants.

§ 41-191.01 Procedure upon recovery of money for antitrust violations

A. When money is recovered for the state, its agencies, its departments, commissions or subdivisions by the attorney general as a result of the enforcement of either state or federal statutes pertaining to antitrust, restraint of trade, or price-fixing activities or conspiracies, whether by final judgment, settlement or otherwise, the funds shall be deposited in the fund created in section 41-191.02.

B. After the payment of any attorney's fee provided for by subsection D of section 41-191 and the crediting to the revolving fund established by section 41-191.02 of an amount equal to ten per cent of the monies so deposited or the actual costs and expenses expended to recover the particular money so deposited, whichever is greater, the remainder of the recovery shall be deposited in the general fund of the state, unless the recovery or a portion thereof, was on behalf of a special or trust fund, in which event the money should be deposited in such special or trust fund or unless the recovery was on behalf of a political subdivision of the state, in which event the remainder of the recovery shall be transmitted to the treasurer of such political subdivision for deposit in its general fund.

§ 41-191.02 Antitrust enforcement revolving fund; receipts and disbursements; exemption; report; data collection

A. The antitrust enforcement revolving fund is established to be administered by the attorney general under the conditions and for the purposes provided in this section. Monies in the fund are subject to legislative appropriation. Monies in the fund shall be exempt from the lapsing provisions of section 35-190.

B. On or before the fifteenth day of January, April, July and October, the attorney general shall cause to be filed with the governor, with copies to the director of the department of administration, the president of the senate and the speaker of the house of representatives, a full and complete account of the receipts and disbursements from the fund in the previous calendar quarter.

C. Monies in the fund shall be used by the attorney general for costs and expenses of antitrust enforcement undertaken by his office and may be expended for such items as filing fees, court costs, travel, depositions, transcripts, reproduction costs, expert witness fees, investigations, and like costs and expenses. Except for the attorney fees due upon the initial recovery of monies as set out in section 41-191.01, in no event shall any of the monies in the fund be used to compensate or employ attorneys or counselors at law.

D. The attorney general shall collect, compile and save data, in a format accessible to the Arizona commerce authority or any member of the legislature, showing the average rack fuel prices for the Phoenix and Tucson petroleum pipeline terminals on a weekly basis. The attorney general may acquire the data by survey or may purchase the data. If the attorney general purchases the data, the data shall be acquired at the lowest available competitive price. The attorney general shall make the data available to the Arizona commerce authority or any member of the legislature without charge.

§ 41-191.03 Collection enforcement revolving fund; disposition of monies

A. The collection enforcement revolving fund is established for the purpose of collecting debts owed to the state. Monies in the fund are subject to legislative appropriation. The attorney general shall administer the fund.

B. The attorney general may expend from the collection enforcement revolving fund the monies that are necessary for operating expenses incurred by the department of law and the collection of debts owed to this state, including reimbursing other accounts or departments within the office of the attorney general from which monies or services for collection were provided.

C. Thirty-five percent of all monies recovered by the attorney general pursuant to section 41-191.04 shall be deposited, pursuant to sections 35-146 and 35-147, in the collection enforcement revolving fund.

D. Sixty-five percent of all monies recovered by the attorney general pursuant to section 41-191.04 shall be distributed as follows:

Those monies that are directly attributable to a fund containing monies that do not revert to the state general fund at the end of the fiscal year shall be deposited, pursuant to sections 35-146 and 35-147, in that fund.
All other monies shall be deposited, pursuant to sections 35-146 and 35-147, in the state general fund.

E. Monies in the collection enforcement revolving fund are exempt from the lapsing provisions of section 35-190 relating to lapsing of appropriations, except that monies remaining in the fund at the end of each fiscal year in excess of one million dollars shall be distributed on a pro rata basis to the funds receiving monies pursuant to subsection D of this section. This distribution shall be based on the percentage that the collections deposited in each fund bear to the total amount deposited in the funds during the fiscal year.

F. Notwithstanding anything in subsections B through E of this section, monies due and owing pursuant to section 12-116.01 and collected by the attorney general shall be distributed as follows:

Twenty percent of all monies recovered by the attorney general pursuant to section 41-191.04 shall be deposited, pursuant to sections 35-146 and 35-147, in the collection enforcement revolving fund.
Eighty percent of all monies recovered by the attorney general pursuant to section 41-191.04 shall be deposited, pursuant to sections 35-146 and 35-147, in the criminal justice enhancement fund established by section 41-2401.

§ 41-191.04 Collection of debts owed the state; reports; remedies

A. The attorney general may initiate such proceedings to collect debts to this state, or to any agency, board, commission or department of this state, as are necessary and appropriate. Agencies, boards, commissions and departments of this state shall submit periodic reports of debts in a form and manner jointly prescribed by the attorney general and the director of the department of administration.

B. The remedies under this article are in addition to any other remedies provided by law.

§ 41-191.05 Colorado river land claims revolving fund; use; accounting; audit; disposition of monies

A. A Colorado river land claims revolving fund is established to be administered by the attorney general.

B. Monies in the fund shall be used by the attorney general for payment of costs and expenses incurred by the attorney general and the state land commissioner in the investigation and prosecution of this state's claims of ownership of sovereign lands in the vicinity of the Colorado river, in accordance with the provisions of law governing such claims.

C. On or before October 15 of each year, the attorney general shall file with the governor, with copies to the director of the department of administration, the president of the senate and the speaker of the house of representatives, a full and complete account of the receipts and disbursements from the fund in the previous year. The auditor general shall audit the fund once a year.

D. Monies recovered by the state from the settlement of this state's sovereign land claims shall be transmitted to the state land commissioner to be deposited in the state general fund, except that twenty-five per cent of the monies recovered shall be deposited in the revolving fund established in subsection A of this section.

E. Monies in the fund are exempt from the lapsing provisions of section 35-190, except that any monies remaining unexpended or unencumbered on June 30, 1990 shall revert to the state general fund.

§ 41-191.06 Victims' rights program

A. A victims' rights program is established in the criminal division of the attorney general's office. The program shall establish and administer an annual plan for assisting and monitoring state and local entities that are required to implement and comply with victims' rights pursuant to title 8, chapter 3, article 7 and title 13, chapter 40. The plan shall provide for the disbursement of victims' rights fund monies, for training on the provision of victims' rights services, for audits of state and local entities that receive fund monies and for other forms of assistance that further uniformity, efficiency and compliance by state and local entities that are responsible for ensuring crime victims' access to justice.

B. The attorney general may employ administrative and other personnel that the attorney general deems necessary to administer the victims' rights program.

§ 41-191.07 Street gang enforcement revolving fund; use; exemption from lapsing

A. A street gang enforcement revolving fund is established consisting of monies appropriated to the fund for the purpose of funding gang prevention programs, training prosecutors and law enforcement personnel in the area of street gang prosecution and enforcement and investigating and prosecuting any offense that is concurrently charged or investigated with any offense relating to criminal street gangs. The Arizona criminal justice commission shall administer the fund under the conditions and for the purposes provided in this section. Monies in the fund are subject to legislative appropriation.

B. Monies in the fund are exempt from lapsing pursuant to section 35-190.

C. Twenty-five per cent of the fund monies shall be distributed to the attorney general and seventy-five per cent of the fund monies shall be distributed to the county attorneys.

D. Fund monies shall be used either to provide personnel or for the training of prosecutors and law enforcement personnel in the area of street gang enforcement and prosecution or for the investigation and prosecution of any offense described in this section.

§ 41-191.08 Victims' rights fund; use; reporting requirements; exemption from lapsing

A. The victims' rights fund is established consisting of monies deposited pursuant to section 12-116.08 and legislative appropriations. Monies in the fund are subject to legislative appropriation. Monies from state general fund appropriations shall be deposited in the victims' rights fund and are not subject to further appropriation. Monies from state general fund appropriations are available for use on deposit in the victims' rights fund. The attorney general shall administer the fund. The attorney general shall use fund monies for the purpose of operating, improving, maintaining and enhancing the victims' rights program established pursuant to section 41-191.06.

B. Each fiscal year the attorney general may spend twelve percent of the total victims' rights fund appropriation and state general fund deposits for the purpose of performing duties mandated by title 13, chapter 40, including the costs of administering the victims' rights program under section 41-191.06.

C. Except as provided in subsections D, G and H of this section, each fiscal year the attorney general shall disburse eighty-eight percent of the total victims' rights fund appropriation and state general fund deposits to state and local entities that have previously qualified under this subsection or have demonstrated a history of need and performance according to criteria established by the attorney general. Each entity that qualifies to receive monies pursuant to this subsection shall receive monies in a percentage that is proportional to that entity's percentage of the total fund monies disbursed to all qualifying entities in the prior fiscal year. The attorney general is not a qualifying entity under this subsection.

D. Except as provided in subsections G and H of this section, each fiscal year the attorney general may disburse victims' rights fund monies to entities that do not qualify under subsection C of this section, that are financially impacted by title 8, chapter 3, article 7 or title 13, chapter 40 and that submit an implementation plan and funding request to the attorney general pursuant to guidelines adopted by the attorney general. The attorney general shall establish procedures to assess the financial impact on and the need of these entities. The attorney general shall disburse monies based on the information that is derived from the assessment. On an annual basis, as new or additional entities receive monies pursuant to this subsection, the attorney general shall proportionally adjust the percentage share disbursed to each entity pursuant to subsection C of this section.

E. Monies in the victims' rights fund shall be used to supplement, not supplant, monies that would otherwise be made available to state and local entities for funding victims' rights services and assistance.

F. Each entity that receives funding pursuant to this section shall submit an annual report to the attorney general that identifies all sources and amounts of monies that are spent for the purposes of implementing and complying with victims' rights. The report shall detail:

The expenditure of the monies that are awarded under the victims' rights program pursuant to section 41-191.06.
The number of instances in which the entity performed mandated victims' rights duties or services.
The level of victim satisfaction with the services.

G. Each fiscal year the attorney general shall review and evaluate the entities that receive funding pursuant to this section. The attorney general may adjust funding levels, redistribute monies or deny continued funding to an entity that fails to effectively implement or comply with victims' rights mandates.

H. Supplemental fund monies appropriated to the attorney general to expand victims' rights training and to expand the reporting of victims' feedback on services provided shall be expended according to a plan and procedures adopted by the attorney general. The attorney general shall spend the monies appropriated for costs to develop, provide, sponsor or support programs that expand the delivery and improve the quality of mandated services to victims of crime by law enforcement, prosecutorial and correctional agencies and courts.

I. The attorney general shall submit an annual report to the governor, the president of the senate and the speaker of the house of representatives that details the status of the victims' rights program under section 41-191.06, the attorney general's compliance with the program, including the level of service, and the expenditure of all monies that are appropriated for the purpose of victims' rights.

J. Monies in the victims' rights fund are exempt from the lapsing provisions of section 35-190.

§ 41-191.09 Attorney general legal services cost allocation fund; contributions; exemptions

A. The attorney general legal services cost allocation fund is established for the purpose of reimbursing the department of law for general agency counsel. Monies in the fund are subject to legislative appropriation. The attorney general shall administer the fund.

B. Except as provided in subsection E of this section, each state agency or department may be charged for general agency counsel provided by the department of law. The amount, if any, shall be specified annually in the general appropriations act.

C. The funding sources for the monies to be deposited pursuant to this section may not include the state general fund, federal funds or other funds that are legally restricted from making such payments.

D. A claim for the legal services cost allocation payment shall be submitted according to the fund source to the department of administration for deposit in the attorney general legal services cost allocation fund.

E. The following agencies are exempt from this section:

The department of water resources.
The residential utility consumer office.
The industrial commission.
The universities and the Arizona board of regents.
The auditor general.
The corporation commission.
The office of the governor.
The department of law.
The house of representatives.
The senate.
The joint legislative budget committee.
The Arizona state library, archives and public records.
The legislative council.
The department of administration risk management fund.
The department of transportation.
The Arizona game and fish department.
The department of economic security.
The Arizona health care cost containment system.
The superior court.
The court of appeals.
The supreme court.
The Arizona department of agriculture and councils that receive administrative and budgetary services from the Arizona department of agriculture.
All self-supporting regulatory agencies as determined pursuant to section 35-143.01.
The Arizona commerce authority.
The department of child safety.

F. Monies in the attorney general legal services cost allocation fund are exempt from lapsing to the state general fund at the end of each fiscal year.

§ 41-191.10 Misrepresentations by employment agents; definition

A. Every employment agent shall reasonably ensure that any representations, whether spoken, written or advertised in printed form, that the employment agent makes with regard to any employment, work or situation and that lead or may lead persons to seek that employment, work or situation, are true and cover all the material facts affecting the employment in question. Failure to comply with this section is an unlawful practice pursuant to section 44-1522.

B. This section does not include a recognized labor union.

C. For the purposes of this section, "employment agent":

Means all persons, firms, corporations or associations that for a fee, commission or charge collected from persons seeking employment either furnish to persons seeking employment information enabling or tending to enable the persons to secure employment, including vocational guidance or employment counseling services, furnish to employers seeking laborers or other help of any kind information enabling or tending to enable the employers to secure help or keep a register of persons seeking employment or help, whether the agents conduct their operations at a fixed place of business, on the streets or as transients and also whether the operations constitute the principal business of the agents or only a sideline or an incident to another business.
Does not mean:

(a) An employer who procures help for himself only.

(b) An employee of such an employer who procures help for him and does not act in a similar capacity for any other employer.

(c) A person, firm, corporation or association that does not charge or collect a fee or commission from a person seeking employment or for assisting that person to obtain employment.

(d) A person, firm, corporation or association that satisfies all of the following:

(i) Is engaged in the business of providing electronic media services.

(ii) Provides classified listings or performs employment research, or both, for employers and persons seeking employment.

(iii) Does not charge or collect a fee or commission for the successful placement of a person seeking employment.

§ 41-191.11 Child and family advocacy center fund; report

A. The child and family advocacy center fund is established consisting of monies appropriated to the fund and monies available to the fund from any other source. The attorney general shall administer the fund and may accept private grants, gifts, contributions and devises to be used for the purposes of this section. Monies in the fund are continuously appropriated.

B. The attorney general may use annually up to five percent of the monies in the fund for administrative costs and shall distribute the remainder of the fund monies to child and family advocacy centers that apply for funding and certify on a form provided by the attorney general that the centers meet the requirements of section 8-466. The attorney general shall distribute the remainder as follows:

Five percent to a statewide membership organization that sets core standards for best practices and provides support and training to emerging and existing child and family advocacy centers and multidisciplinary teams.
Forty-seven and one-half percent equally among the child and family advocacy centers that meet the qualifications prescribed in this subsection.
Forty-seven and one-half percent to the child and family advocacy centers that meet the qualifications prescribed in this subsection based on each center's proportion of all victims served.

C. Within thirty days after the last day of each calendar quarter, the attorney general shall report to the joint legislative budget committee a summary of the quarterly and year-to-date expenditures, including the expenditure of any monies appropriated to the fund in a prior fiscal year.

§ 41-191.12 Unreported in-kind political contributions task force fund; joint task force on unreported in-kind political contributions; exemption

(L21, Ch. 405, sec. 12)

A. The unreported in-kind political contributions task force fund is established consisting of legislative appropriations. The attorney general shall administer the fund. Monies in the fund are continuously appropriated. Monies in the fund may be used only to fund the joint task force on unreported in-kind political contributions established by this section.

B. The joint task force on unreported in-kind political contributions is established consisting of designees of the attorney general and the secretary of state. The joint task force shall investigate whether and to what extent the business or other practices of social media platforms and internet search engines result in unreported in-kind political contributions to candidates in this state in violation of title 16, chapter 6 and may take enforcement action as appropriate. The joint task force may investigate the following actions as possible unlawful political contributions:

Permanent or temporary cancellation or other restrictions on a candidate's access to a social media platform.
Algorithmic bias against one or more candidates or a political party.
Algorithmic promotion of one or more candidates or a political party.

C. Monies in the unreported in-kind political contributions task force fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-191.13 Organized retail theft task force; members; duties; annual report

A. The attorney general shall establish the organized retail theft task force to combat crimes that relate to stealing, embezzling or obtaining retail merchandise by fraud, false pretenses or other illegal means for the purposes of reselling the items. The attorney general shall invite federal, state and local law enforcement personnel to participate in the task force in order to use the combined skills, expertise and resources of law enforcement personnel more effectively.

B. The task force shall consist of the following members:

One full-time:

(a) Prosecutor.

(b) Paralegal.

Six investigators.

C. The task force shall:

Meet regularly to review cases and provide updates on ongoing cases to all members of the task force.
Investigate, apprehend and recommend for prosecution, as appropriate, individuals or entities that participate in the purchase, sale or distribution of stolen property from a retail establishment or through the use of an internet or network site and shall target individuals or entities that organize or commit theft and other property crimes for financial gain.
Investigate offenses or violations that are under the attorney general's jurisdiction as prescribed by section 21-422.
Review, investigate and recommend for prosecution appropriate cases brought before the task force by law enforcement agencies or authorized loss prevention personnel in this state.
On or before July 1, 2025 and each year thereafter, submit a report to the governor, the president of the senate and the speaker of the house of representatives and provide a copy to the secretary of state on the task force's activities and any recommendations for legislative action relating to criminal penalties for crimes that have a negative impact on this state's economy.

§ 41-192 Powers and duties of attorney general; restrictions on state agencies as to legal counsel; exceptions; compromise and settlement monies

A. The attorney general shall have charge of and direct the department of law and shall serve as chief legal officer of the state. The attorney general shall:

Be the legal advisor of the departments of this state and render such legal services as the departments require.
Establish administrative and operational policies and procedures within his department.
Approve long-range plans for developing departmental programs therein, and coordinate the legal services required by other departments of this state or other state agencies.
Represent school districts and governing boards of school districts in any lawsuit involving a conflict of interest with other county offices.
Represent political subdivisions, school districts and municipalities in suits to enforce state or federal statutes pertaining to antitrust, restraint of trade or price-fixing activities or conspiracies, if the attorney general notifies in writing the political subdivisions, school districts and municipalities of the attorney general's intention to bring any such action on their behalf. At any time within thirty days after the notification, a political subdivision, school district or municipality, by formal resolution of its governing body, may withdraw the authority of the attorney general to bring the intended action on its behalf.
In any action brought by the attorney general pursuant to state or federal statutes pertaining to antitrust, restraint of trade, or price-fixing activities or conspiracies for the recovery of damages by this state or any of its political subdivisions, school districts or municipalities, in addition to the attorney general's other powers and authority, the attorney general on behalf of this state may enter into contracts relating to the investigation and prosecution of such action with any other party plaintiff who has brought a similar action for the recovery of damages and with whom the attorney general finds it advantageous to act jointly or to share common expenses or to cooperate in any manner relative to such action. In any such action, notwithstanding any other laws to the contrary, the attorney general may undertake, among other things, to render legal services as special counsel or to obtain the legal services of special counsel from any department or agency of the United States, of this state or any other state or any department or agency thereof or any county, city, public corporation or public district in this state or in any other state that has brought or intends to bring a similar action for the recovery of damages or its duly authorized legal representatives in such action.
Organize the civil rights division within the department of law and administer such division pursuant to the powers and duties provided in chapter 9 of this title.
Compile, publish and distribute to all state agencies, departments, boards, commissions and councils, and to other persons and government entities on request, at least every ten years, the Arizona agency handbook that sets forth and explains the major state laws that govern state agencies, including information on the laws relating to bribery, conflicts of interest, contracting with the government, disclosure of public information, discrimination, nepotism, financial disclosure, gifts and extra compensation, incompatible employment, political activity by employees, public access and misuse of public resources for personal gain. A supplement to the handbook reflecting revisions to the information contained in the handbook shall be compiled and distributed by the attorney general as deemed necessary.

B. Except as otherwise provided by law, the attorney general may:

Organize the department into such bureaus, subdivisions or units as he deems most efficient and economical, and consolidate or abolish them.
Adopt rules for the orderly conduct of the business of the department.
Subject to chapter 4, article 4 of this title, employ and assign assistant attorneys general and other employees necessary to perform the functions of the department.
Compromise or settle any action or claim by or against this state or any department, board or agency of this state. If the compromise or settlement involves a particular department, board or agency of this state, the compromise or settlement shall be first approved by the department, board or agency. If no department or agency is named or otherwise materially involved, the approval of the governor shall be first obtained.
Charge reasonable fees for distributing official publications, including attorney general legal opinions and the Arizona agency handbook. The fees received shall be transmitted to the state treasurer for deposit in the state general fund.

C. The powers and duties of a bureau, subdivision or unit shall be limited to those assigned by law to the department.

D. Notwithstanding any law to the contrary, except as provided in subsections E and F of this section, no state agency other than the attorney general shall employ legal counsel or make an expenditure or incur an indebtedness for legal services, but the following are exempt from this section:

The director of water resources.
The residential utility consumer office.
The industrial commission.
The Arizona board of regents.
The auditor general.
The corporation commissioners and the corporation commission other than the securities division.
The office of the governor.
The constitutional defense council.
The office of the state treasurer.
The Arizona commerce authority.
The water infrastructure finance authority of Arizona.

E. If the attorney general determines that he is disqualified from providing judicial or quasi-judicial legal representation or legal services on behalf of any state agency in relation to any matter, the attorney general shall give written notification to the state agency affected. If the agency has received written notification from the attorney general that the attorney general is disqualified from providing judicial or quasi-judicial legal representation or legal services in relation to any particular matter, the state agency is authorized to make expenditures and incur indebtedness to employ attorneys to provide the representation or services.

F. If the attorney general and the director of the department of agriculture cannot agree on the final disposition of a pesticide complaint under section 3-368, if the attorney general and the director determine that a conflict of interest exists as to any matter or if the attorney general and the director determine that the attorney general does not have the expertise or attorneys available to handle a matter, the director is authorized to make expenditures and incur indebtedness to employ attorneys to provide representation or services to the department with regard to that matter.

G. Any department or agency of this state authorized by law to maintain a legal division or incur expenses for legal services from funds derived from sources other than the general revenue of the state, or from any special or trust fund, shall pay from such source of revenue or special or trust fund into the general fund of the state, to the extent such funds are available and on a reimbursable basis for warrants drawn, the amount actually expended by the department of law within legislative appropriations for such legal division or legal services.

H. Appropriations made pursuant to subsection G of this section shall not be subject to lapsing provisions otherwise provided by law. Services for departments or agencies to which this subsection and subsection F of this section are applicable shall be performed by special or regular assistants to the attorney general.

I. Notwithstanding section 35-148, monies received by the attorney general from charges to state agencies and political subdivisions for legal services relating to interagency service agreements shall be deposited, pursuant to sections 35-146 and 35-147, in an attorney general agency services fund. Monies in the fund are subject to legislative appropriation and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

J. Unless otherwise provided by law, monies received for and belonging to the state and resulting from compromises and settlements entered into pursuant to subsection B of this section, excluding restitution and reimbursement to state agencies for costs or attorney fees, shall be deposited into the state treasury and credited to the state general fund pursuant to section 35-142. Monies received for and belonging to the state and resulting from a compromise or settlement are not considered custodial, private or quasi-private monies unless specifically provided by law. On or before January 15, April 15, July 15 and October 15, the attorney general shall file with the governor, with copies to the director of the department of administration, the president of the senate, the speaker of the house of representatives, the secretary of state and the staff director of the joint legislative budget committee, a full and complete account of the deposits into the state treasury made pursuant to this subsection in the previous calendar quarter. For the purposes of this subsection, "restitution" means monies intended to compensate a specific, identifiable person, including this state, for economic loss.

§ 41-192.01 Authorizing Arizona power authority to employ legal counsel for certain purposes

The Arizona power authority shall also be exempt from the provisions of this article to the extent that it may employ legal counsel to represent it before any federal agency and before any federal court and in matters incidental to any proceeding before any such federal agency or court.

§ 41-192.02 Legal counsel in certain civil actions; counsel to fire districts

A. The attorney general in his discretion is authorized to represent a current or former officer or employee of this state against whom a civil action is brought in his individual capacity or who is subject to a civil nonparty subpoena until such time as it is established as a matter of law that the alleged activity or events which form the basis of the complaint were not performed, or not directed to be performed, within the scope or course of the officer's or employee's duty or employment.

B. An agency authorized by law to employ legal counsel may provide representation to current or former officers or employees in the circumstances prescribed in subsection A of this section.

C. The attorney general may advise and represent a fire district when the county attorney is unable to represent the district due to a conflict of interest.

§ 41-193 Department of law; composition; powers and duties

A. The department of law shall be composed of the attorney general and the subdivisions of the department created as provided in this article. Unless otherwise provided by law the department shall:

Prosecute and defend in the supreme court all proceedings in which this state or an officer of this state in the officer's official capacity is a party.
At the direction of the governor or, alternatively, if deemed necessary by the attorney general, prosecute and defend any proceeding in a state court other than the supreme court in which this state or an officer of this state is a party or has an interest.
Represent this state in any action in a federal court, the cost thereof and the expenses of the attorney general incurred therein to be a charge against this state.
Exercise supervisory powers over county attorneys of the several counties in matters pertaining to that office and require reports relating to the public business thereof.
At the direction of the governor, or if deemed necessary, assist the county attorney of any county in the discharge of the county attorney's duties.
Maintain a docket of all proceedings in which the attorney general is required to appear, showing the condition thereof, the proceedings therein, the proceedings subsequent to judgment and the reasons for any delay of execution.
On demand by the legislature, either house of the legislature or any member of the legislature, any public officer of this state or a county attorney, render a written opinion on any question of law relating to their offices. These opinions are public records.
On demand by the legislature, either house of the legislature or any member of the legislature pursuant to the sovereign authority of this state and article II, section 3, Constitution of Arizona, review an executive order issued by the president of the United States that has not been affirmed by a vote of Congress and signed into law as prescribed by the Constitution of the United States to determine the constitutionality of the executive order and whether this state should seek an exemption from the application of the executive order or seek to have the order declared to be an unconstitutional legislative authority by the president.
Perform other duties prescribed by law.

B. The department of law, in the name of this state and under the direction of the governor, shall purchase property offered for sale under execution issued on a judgment in favor of or for the use of this state, and shall enter satisfaction, wholly or in part, of the judgment as consideration for the purchase. If the property of the judgment debtor has been sold under a prior judgment or is subject to a prior judgment, lien or encumbrance, the department of law, under direction of the governor, shall redeem the property from the prior judgment, lien or encumbrance. All money necessary for the redemption shall, on the order of the governor, be paid from money appropriated for such purpose.

C. The department of law shall institute investigations for discovery of property that may have escheated or would escheat to this state, and for such purpose may require any person before the superior court to answer investigations, produce books and render accounts relating to the property. The department may institute action in the superior court in the county in which the property is located for recovery of escheats or may require the county attorney to conduct such proceedings.

§ 41-194 Opinions; annual report; distribution

A. The attorney general shall distribute a copy of each written opinion issued pursuant to section 41-193 to the governor, the president of the senate, the speaker of the house of representatives, the secretary of the senate, the chief clerk of the house of representatives, and to any department or agency required to perform some function for the implementation of such opinion. Copies of such opinions shall be available for distribution to the general public pursuant to section 39-121.01.

B. Not later than October 15 each year the attorney general shall submit to the governor a written report of the activities of the department. A copy of the report shall be provided to each member of the legislature, upon request, and the Arizona state library, archives and public records shall be provided with the number of copies required for exchange with other states and agencies. Copies of such report shall be available for distribution, upon request, to the general public pursuant to section 39-121.01.

§ 41-194.01 Violations of state law by counties, cities and towns; attorney general investigation; report; withholding of state shared revenues; notice of violation

(L21, Ch. 403, sec. 18)

A. At the request of one or more members of the legislature, the attorney general shall investigate any ordinance, regulation, order or other official action adopted or taken by the governing body of a county, city or town or any written policy, written rule or written regulation adopted by any agency, department or other entity of the county, city or town that the member alleges violates state law or the Constitution of Arizona.

B. The attorney general shall make a written report of findings and conclusions as a result of the investigation within thirty days after receipt of the request and shall provide a copy of the report to the governor, the president of the senate, the speaker of the house of representatives, the member or members of the legislature making the original request and the secretary of state. If the attorney general concludes that the ordinance, regulation, order, written policy, written rule or other action under investigation:

Violates any provision of state law or the Constitution of Arizona, the attorney general shall provide notice to the county, city or town, by certified mail, of the violation and shall indicate that the county, city or town has thirty days to resolve the violation. If the attorney general determines that the county, city or town has failed to resolve the violation within thirty days, the attorney general shall:

(a) Notify the state treasurer who shall withhold and redistribute state shared monies from the county, city or town as provided by section 42-5029, subsection L and from the city or town as provided by section 43-206, subsection F.

(b) Continue to monitor the response of the governing body, and when the offending ordinance, regulation, order or action is repealed or the violation is otherwise resolved, the attorney general shall notify:

(i) The governor, the president of the senate, the speaker of the house of representatives and the member or members of the legislature making the original request that the violation has been resolved.

(ii) The state treasurer to restore the distribution of state shared revenues to the county, city or town.

May violate a provision of state law or the Constitution of Arizona, the attorney general shall file a special action in the supreme court to resolve the issue, and the supreme court shall give the action precedence over all other cases. The court shall require the county, city or town to post a bond equal to the amount of state shared revenues paid to the county, city or town pursuant to sections 42-5029 and 43-206 in the preceding six months.
Does not violate any provision of state law or the Constitution of Arizona, the attorney general shall take no further action pursuant to this section.

C. Before a member of the legislature may request an investigation by the attorney general of any written policy, written rule or written regulation adopted by any agency, department or other entity of a county, city or town pursuant to subsection A of this section, the member of the legislature shall first provide a written notification of the alleged violation of state law or the Constitution of Arizona to the chief executive officer or governing body of the county, city or town. If the county, city or town does not repeal or otherwise resolve the violation within sixty days after receiving the notification, the member or members of the legislature may request an investigation by the attorney general pursuant to this section.

§ 41-195 Violation; classification

A person violating any provision of this article or any regulation authorized by this article, is guilty of a class 2 misdemeanor. If the person violating any provision of this article or regulation adopted under the authority of this article is an officer or employee of a state agency, he shall, in addition to the prescribed penalties, be removed forthwith from such office or employment.

§ 41-196 Witness protection

A. The director of the department of public safety with the concurrence of the attorney general may upon the director's own initiative or at the request of any county attorney or law enforcement agency provide for the security of government witnesses, potential government witnesses and their immediate families in official criminal or civil proceedings instituted or investigations pending against a person alleged to have engaged in a violation of the law. Providing for this security of witnesses may include provision of housing facilities and for the health, safety and welfare of such witnesses and their immediate families, if testimony by such a witness might subject the witness or a member of his immediate family to a danger of bodily injury, and may continue so long as such danger exists. The director of the department of public safety with the concurrence of the attorney general may authorize the purchase, rental or modification of protected housing facilities for the purpose of this section. He may also with the concurrence of the attorney general contract with any government or department of government to obtain or to provide the facilities or services to carry out this section. Any appropriation for witness protection shall be made to and administered by the department of public safety.

B. The offer of protection to a person may be conditioned by the director of the department of public safety upon reimbursement in whole or part to the state by a government of the cost of maintaining and protecting such person.

C. Monies deposited in the anti-racketeering revolving fund established pursuant to section 13-2314.01 may be used for witness protection.

§ 41-198 Fatal or near fatal domestic violence review teams; duties; membership; report; confidentiality; violation; classification; definitions

A. A political subdivision of this state or a combination of political subdivisions may establish a fatal or near fatal domestic violence review team to:

Examine fatal or near fatal incidents of domestic violence to better understand the dynamics of these fatalities or near fatalities.
Report to the office of the attorney general its findings and recommendations as to how fatal or near fatal incidents of domestic violence may be prevented and how the system can be improved. The report shall not contain any information that identifies individuals in specific incidents of domestic violence related fatalities or near fatalities.
Determine the number and type of incidents it wishes to review.

B. A review team shall not review a fatal or near fatal incident of domestic violence until a criminal investigation or proceeding connected with the fatality or near fatality is completed.

C. A review team shall designate one of its members to serve as chairperson. The chairperson shall call meetings as necessary and is responsible for submitting the report prescribed in subsection A, paragraph 2 of this section.

D. All information and records acquired by a review team are confidential and are not subject to subpoena, discovery or introduction into evidence in any civil or criminal proceeding or disciplinary action. Information that is otherwise available from other sources is not immune from subpoena, discovery or introduction into evidence through those sources solely because they were presented to or reviewed by a review team.

E. A member of a review team or any person who presents information to a review team shall not be questioned in any civil or criminal proceeding or disciplinary action regarding the information presented. This subsection does not prevent a person from testifying regarding information obtained independently of the review team or as to public information.

F. Review team meetings are closed to the public and are not subject to title 38, chapter 3, article 3.1 if the review team is reviewing a fatal or near fatal incident of domestic violence case. All other review team meetings are open to the public.

G. The political subdivision shall establish the membership of a review team. Each review team may be comprised of the following:

A representative from a county or municipal law enforcement agency.
A representative of a county or municipal court.
A representative of a county or municipal prosecutor's office.
A representative of a local domestic violence prevention program.
A victim of domestic violence.
A representative of a county or state public health agency.
A representative of the office of the county medical examiner.
If the department of child safety received a report on any person residing with the victim before the fatal or near fatal incident of domestic violence, a representative of the department of child safety who serves the area covered by the review team for the duration of the review of that fatality or near fatality.
A representative of a statewide domestic violence coalition.

H. The office of the attorney general shall receive the reports of the review teams and distribute copies of them to the president of the senate, the speaker of the house of representatives, the governor, the peace officer standards and training board, the state domestic violence coalition and the chief justice of the supreme court, on or before January 31 of each year. Copies shall also be provided to the secretary of state.

I. When a review team concludes a fatal or near fatal incident of domestic violence review, the review team shall return all information and records concerning the victim and the family to the agency that provided the information or, if directed by that agency, shall destroy that information.

J. A person who violates the confidentiality requirements of this section is guilty of a class 2 misdemeanor.

K. For the purposes of this section:

"Domestic violence" has the same meaning prescribed in section 13-3601.
"Fatal incident of domestic violence" means a homicide or suicide that is committed by a party to the domestic violence and not committed by an on-duty police officer acting within the scope of employment.
"Near fatal incident of domestic violence" means an assault that is committed by a party to the domestic violence where the victim suffered life threatening injuries.
"Political subdivision" means a county, city or town.

§ 41-199 Internet crimes against children enforcement fund; use; reporting

A. The internet crimes against children enforcement fund is established consisting of monies deposited pursuant to sections 5-554 and 5-568 and monies available from any other source. The attorney general shall administer the fund.

B. Subject to legislative appropriation, the attorney general shall use monies in the fund to enter into one or more intergovernmental agreements to continue the operation of the federally recognized internet crimes against children task force program that coordinates a national network of coordinated task forces that assist federal, state, local and tribal law enforcement agencies in investigations, forensic examinations and prosecutions related to technology-facilitated sexual exploitation of children and internet crimes against children.

C. Within thirty days after the last day of each calendar quarter, the attorney general shall provide to the joint legislative budget committee a summary of quarterly and year-to-date expenditures and progress, including any prior year appropriations that were nonlapsing.

Chapter 2 Administrative Officers

Article 1 Revised Uniform Law on Notarial Acts

§ 41-251 Definitions

In this chapter, unless the context otherwise requires:

"Acknowledgment" means a declaration by an individual before a notarial officer that the individual has signed a record for the purpose stated in the record and, if the record is signed in a representative capacity, that the individual signed the record with proper authority and signed it as the act of the individual or entity identified in the record.
"Commission" means to authorize to perform notarial acts and the written authority to perform those acts.
"Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities.
"Electronic signature" means an electronic symbol, sound or process that is attached to or logically associated with a record and that is executed or adopted by an individual with the intent to sign the record.
"In a representative capacity" means acting as any of the following:

(a) An authorized officer, agent, partner, trustee or other representative for a person other than an individual.

(b) A public officer, personal representative, guardian or other representative, in the capacity stated in a record.

(d) An authorized representative of another in any other capacity.

"Notarial act" or "notarization":

(a) Means any act, whether performed with respect to a tangible or electronic record, that a notarial officer may perform under section 41-252.

(b) Includes taking an acknowledgment, administering an oath or affirmation, taking a verification on oath or affirmation, witnessing or attesting a signature, certifying or attesting a copy and noting a protest of a negotiable instrument.

"Notarial officer" means a notary public or other individual who is authorized to perform a notarial act.
"Notary public" or "notary" means any individual who is commissioned to perform notarial acts by the secretary of state.
"Official stamp" means a physical image that is affixed to a tangible record or an electronic image that is attached to or logically associated with an electronic record.
"Person" means an individual, corporation, business trust, statutory trust, estate, trust, partnership, limited liability company, association, joint venture, public corporation, government or governmental subdivision, agency or instrumentality or any other legal or commercial entity.
"Record" means information that is either:

(a) Inscribed on a tangible medium.

(b) Stored in an electronic or other medium and that is retrievable in perceivable form.

"Sign" means, with present intent to authenticate or adopt a record, either of the following:

(a) To execute or adopt a tangible symbol.

(b) To attach to or logically associate with the record an electronic symbol, sound or process.

"Signature" means a tangible symbol or an electronic signature that evidences the signing of a record.
"Stamping device" means either of the following:

(a) A physical device that is capable of affixing to a tangible record an official stamp.

(b) An electronic device or process that is capable of attaching to or logically associating with an electronic record an official stamp.

"State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States.
"Verification on oath or affirmation" means a declaration, made by an individual on oath or affirmation before a notarial officer, that a statement in a record is true.

§ 41-252 Authority to perform notarial acts

A. A notarial officer may perform a notarial act authorized by this article or by any law of this state other than this article.

B. A notarial officer may not perform a notarial act with respect to a record to which the officer or the officer's spouse is a party or in which either of them has a direct beneficial interest. A notarial act performed in violation of this subsection is voidable.

C. A notarial officer may certify that a tangible copy of an electronic record is an accurate copy of the electronic record.

§ 41-253 Requirements for certain notarial acts

A. A notarial officer who takes an acknowledgment of a record shall determine, from personal knowledge or satisfactory evidence of the identity of the individual, that the individual appearing before the officer and making the acknowledgment has the identity claimed and that the signature on the record is the signature of the individual.

B. A notarial officer who takes a verification of a statement on oath or affirmation shall determine both of the following:

From personal knowledge or satisfactory evidence of the identity of the individual, that the individual appearing before the officer and making the verification has the identity claimed and that the signature on the statement verified is the signature of the individual.
That the record that contains the statement verified is complete to the best of the notarial officer's knowledge.

C. A notarial officer who witnesses or attests to a signature shall determine, from personal knowledge or satisfactory evidence of the identity of the individual, that the individual appearing before the officer and signing the record has the identity claimed.

D. A notarial officer who certifies or attests a copy of a record or an item that was copied shall determine that the copy is a full, true and accurate transcription or reproduction of the record or item. Except as required under section 41-319, a notarial officer may not certify or attest a copy of a public record of this state.

E. A notarial officer who makes or notes a protest of a negotiable instrument shall determine the matters set forth in section 47-3505, subsection B.

F. A notary public who performs a notarial act for an individual shall communicate with the individual through either of the following:

Directly in a language that both the notary public and the individual understand.
Indirectly through a translator who communicates directly with the notary public and the individual in languages that the translator understands.

§ 41-254 Personal appearance required

A. If a notarial act relates to a statement made in or a signature executed on a record, the individual making the statement or executing the signature shall appear personally before the notarial officer.

B. If a notarial act involves a translator under section 41-253, subsection F, the translator shall appear personally before the notary public.

§ 41-255 Identification of individual

A. A notarial officer has personal knowledge of the identity of an individual appearing before the officer if the individual is personally known to the notarial officer through dealings sufficient to provide reasonable certainty that the individual has the identity claimed.

B. A notarial officer has satisfactory evidence of the identity of an individual appearing before the notarial officer if the officer can identify the individual:

By means of:

(a) An unexpired United States passport or a state-issued driver license or nonoperating identification license.

(b) An unexpired identification card issued by any branch of the United States armed forces.

(c) Another form of unexpired government identification issued by the United States, a state or a tribal government to an individual that contains the signature or a photograph and physical description of the individual and that is satisfactory to the notarial officer.

(d) An inmate identification card issued by the state department of corrections or federal bureau of prisons, if the inmate is in state or federal custody.

(e) An inmate identification card issued by a county sheriff, if the inmate is in the custody of the county sheriff.

By verification on oath or affirmation of a credible witness personally appearing before the notarial officer and known to the notarial officer or whom the notarial officer can identify on the basis of satisfactory evidence of identity pursuant to paragraph 1 of this subsection.

C. In addition to subsection B of this section, for the purposes of a real estate conveyance or financing, a notarial officer has satisfactory evidence of the identity of an individual appearing before the notarial officer if the notarial officer can identify the individual by means of either of the following:

An unexpired passport issued by a national government other than the United States government that is accompanied by an unexpired visa or other documentation issued by the United States government and that is necessary to establish the individual's legal presence in the United States.
An unexpired identification card that is deemed acceptable by the United States department of homeland security to establish the individual's legal presence in the United States and that is accompanied by supporting documents as required by the United States department of homeland security.

D. A notarial officer may require an individual to provide additional information or identification credentials necessary to assure the notarial officer of the individual's identity.

§ 41-256 Authority to refuse to perform notarial acts

A. A notarial officer may refuse to perform a notarial act if the notarial officer is not satisfied that either:

The individual executing the record is competent or has the capacity to execute the record.
The individual's signature is knowingly and voluntarily made.

B. A notarial officer may refuse to perform a notarial act unless refusal is prohibited by any law other than this article.

§ 41-257 Signature if individual unable to sign

If an individual is physically unable to sign a record, the individual may direct an individual other than the notarial officer to sign the individual's name on the record. The notarial officer shall insert "Signature affixed by (name of other individual) at the direction of (name of individual)" or words of similar import.

§ 41-258 Notarial act in this state

A. Any of the following may perform a notarial act in this state:

A notary public of this state.
A judge, clerk or deputy clerk of a court of record of this state.
An individual who is licensed to practice law in this state.
Any other individual who is authorized to perform the specific act by the laws of this state.

B. The signature and title of an individual performing a notarial act in this state are prima facie evidence that the signature is genuine and that the individual holds the designated title.

C. The signature and title of a notarial officer listed in subsection A, paragraph 1, 2 or 3 of this section conclusively establish the authority of the notarial officer to perform the notarial act.

§ 41-259 Notarial act in another state

A. A notarial act performed in another state has the same effect under the laws of this state as if performed by a notarial officer of this state, if the act performed in that state is performed by any of the following:

A notary public of that state.
A judge, clerk or deputy clerk of a court of that state.
Any other individual who is authorized by the laws of that state to perform the notarial act.

B. The signature and title of an individual performing a notarial act in another state are prima facie evidence that the signature is genuine and that the individual holds the designated title.

C. The signature and title of a notarial officer described in subsection A, paragraph 1 or 2 of this section conclusively establish the authority of the notarial officer to perform the notarial act.

§ 41-260 Notarial act under authority of federally recognized Indian tribes

A. A notarial act performed under the authority and in the jurisdiction of a federally recognized Indian tribe has the same effect as if performed by a notarial officer of this state, if the act performed in the jurisdiction of the tribe is performed by any of the following:

A notary public of the tribe.
A judge, clerk or deputy clerk of a court of the tribe.
Any other individual who is authorized by the laws of the tribe to perform the notarial act.

B. The signature and title of an individual performing a notarial act under the authority of and in the jurisdiction of a federally recognized Indian tribe are prima facie evidence that the signature is genuine and that the individual holds the designated title.

C. The signature and title of a notarial officer described in subsection A, paragraph 1 or 2 of this section conclusively establish the authority of the notarial officer to perform the notarial act.

§ 41-261 Notarial act under federal authority

A. A notarial act performed under federal law has the same effect under the laws of this state as if performed by a notarial officer of this state, if the act performed under federal law is performed by any of the following:

A judge, clerk or deputy clerk of a court.
An individual who is in military service or performs duties under the authority of military service and who is authorized to perform notarial acts under federal law.
An individual who is designated a notarizing officer by the United States department of state for performing notarial acts overseas.
Any other individual who is authorized by federal law to perform the notarial act.

B. The signature and title of an individual acting under federal authority and performing a notarial act are prima facie evidence that the signature is genuine and that the individual holds the designated title.

C. The signature and title of a notarial officer described in subsection A, paragraph 1, 2 or 3 of this section conclusively establish the authority of the notarial officer to perform the notarial act.

§ 41-262 Foreign notarial act; definition

A. If a notarial act is performed under authority and in the jurisdiction of a foreign state or constituent unit of the foreign state or is performed under the authority of a multinational or international governmental organization, the act has the same effect under the laws of this state as if performed by a notarial officer of this state.

B. If the title of office and indication of authority to perform notarial acts in a foreign state appear in a digest of foreign law or in a list customarily used as a source for that information, the authority of an officer with that title to perform notarial acts is conclusively established.

C. The signature and official stamp of an individual holding an office described in subsection B of this section are prima facie evidence that the signature is genuine and that the individual holds the designated title.

D. An apostille in the form prescribed by the Hague convention of October 5, 1961 and issued by a foreign state party to the Convention conclusively establishes that the signature of the notarial officer is genuine and that the notarial officer holds the indicated office.

E. A consular authentication issued by an individual designated by the United States department of state as a notarizing officer for performing notarial acts overseas and attached to the record with respect to which the notarial act is performed conclusively establishes that the signature of the notarial officer is genuine and that the notarial officer holds the indicated office.

F. For the purposes of this section, "foreign state" means a government other than the United States, a state or a federally recognized Indian tribe.

§ 41-263 Notarial act performed for remotely located individual; definitions

A. A remotely located individual may comply with section 41-254 by using communication technology to appear before a notary public.

B. A notary public located in this state may perform a notarial act using communication technology for a remotely located individual if:

The notary public has any of the following:

(a) Personal knowledge under section 41-255, subsection A of the remotely located individual's identity.

(b) Satisfactory evidence of the identity of the individual by oath or affirmation from a credible witness appearing before and identified by the notary public under section 41-255, subsection B or this section.

(c) Satisfactory evidence of the identity of the remotely located individual by using at least two different types of identity proofing.

The notary public is able reasonably to confirm that a record before the notary public is the same record in which the remotely located individual made a statement or on which the individual executed a signature.
The notary public, or a person acting on behalf of the notary public, creates an audiovisual recording of the performance of the notarial act.
For a remotely located individual located outside the United States, both of the following apply:

(a) The record either:

(i) Is to be filed with or relates to a matter before a public official or court, governmental entity or other entity subject to the jurisdiction of the United States.

(ii) Involves property located in the territorial jurisdiction of the United States or involves a transaction substantially connected with the United States.

(b) The notary public has no actual knowledge that the act of making the statement or signing the record is prohibited by the foreign state in which the remotely located individual is located.

C. If a notarial act is performed under this section, the certificate of notarial act required by section 41-264 and the short form certificate provided in section 41-265 must indicate that the notarial act was performed using communication technology.

D. A short form certificate provided in section 41-265 for a notarial act subject to this section is sufficient if either of the following applies:

The form of certificate complies with rules adopted under subsection G, paragraph 1 of this section.
The certificate is in the form provided in section 41-265 and contains a statement substantially as follows: "This notarial act involved the use of communication technology."

E. A notary public, a guardian, conservator or agent of a notary public or a personal representative of a deceased notary public shall retain the audiovisual recording created under subsection B, paragraph 3 of this section or cause the recording to be retained by a repository designated by or on behalf of the person required to retain the recording. Unless a different period is required by rule adopted under subsection G, paragraph 4 of this section, the recording must be retained for a period of at least five years after the recording is made.

F. Before a notary public performs the notary public's initial notarial act under this section, the notary public must notify the secretary of state that the notary public will be performing notarial acts with respect to remotely located individuals and identify the technologies the notary public intends to use. If the secretary of state has established standards under subsection G of this section and section 41-275 for approval of communication technology or identity proofing, the communication technology and identity proofing must conform to the standards.

G. In addition to adopting rules under section 41-275, on or before July 1, 2022, the secretary of state shall adopt rules under this section regarding performance of notarial acts for remotely located individuals. The rules may:

Prescribe the means of performing a notarial act involving a remotely located individual using communication technology.
Establish standards for communication technology and identity proofing.
Establish requirements or procedures to approve providers of communication technology and the process of identity proofing.
Establish standards and a period for the retention of an audiovisual recording created under subsection B, paragraph 3 of this section.

H. Before adopting, amending or repealing a rule governing performance of a notarial act with respect to a remotely located individual, the secretary of state must consider:

The most recent standards regarding the performance of a notarial act with respect to a remotely located individual adopted by national standard-setting organizations and the recommendations of the national association of secretaries of state.
Standards, practices and customs of other jurisdictions that have laws substantially similar to this section.
The views of governmental officials and entities and other interested persons.

I. For the purposes of this section:

"Communication technology" means an electronic device or process that:

(a) Allows a notary public and a remotely located individual to communicate with each other simultaneously by sight and sound.

(b) When necessary and consistent with other applicable law, facilitates communication with a remotely located individual who has a vision, hearing or speech impairment.

"Foreign state" means a jurisdiction other than the United States, a state or a federally recognized Indian tribe.
"Identity proofing" means a process or service by which a third person provides a notary public with a means to verify the identity of a remotely located individual by a review of personal information from public or private data sources.
"Outside the United States" means a location outside the geographic boundaries of the United States, Puerto Rico, the United States Virgin Islands and any territory, insular possession or other location subject to the jurisdiction of the United States.
"Remotely located individual" means an individual who is not in the physical presence of the notary public who performs a notarial act under subsection B of this section.

§ 41-264 Certificate of notarial act

A. A notarial act must be evidenced by a certificate. The certificate must:

Be executed contemporaneously with the performance of the notarial act.
Be signed and dated by the notarial officer and, if the notarial officer is a notary public, be signed in the same manner as on file with the secretary of state.
Identify the jurisdiction in which the notarial act is performed.
Contain the title of office of the notarial officer.
If the notarial officer is a notary public, indicate the date of expiration of the notarial officer's commission.
Be worded and completed using only letters, characters and a language that are read, written and understood by the notary public.

B. If a notarial act regarding a tangible record is performed by a notary public, an official stamp must be affixed to the certificate. If a notarial act is performed regarding a tangible record by a notarial officer other than a notary public and the certificate contains the information specified in subsection A, paragraphs 2, 3 and 4 of this section, an official stamp may be affixed to the certificate. If a notarial act regarding an electronic record is performed by a notarial officer and the certificate contains the information specified in subsection A, paragraphs 2, 3, 4 and 5 of this section, an official stamp may be attached to or logically associated with the certificate.

C. A certificate of a notarial act is sufficient if it meets the requirements of subsections A and B of this section and any of the following:

It is in a short form set forth in section 41-265.
It is in a form otherwise allowed by the laws of this state.
It is in a form allowed by the laws applicable in the jurisdiction in which the notarial act was performed.
It sets forth the actions of the notarial officer and the actions are sufficient to meet the requirements of the notarial act as provided in sections 41-253, 41-254 and 41-255 or the laws of this state other than this article.

D. By executing a certificate of a notarial act, a notarial officer certifies that the notarial officer has complied with the requirements and made the determinations specified in sections 41-252, 41-253 and 41-254.

E. A notarial officer may not affix the notarial officer's signature to or logically associate it with a certificate until the notarial act has been performed.

F. If a notarial act is performed regarding a tangible record, a certificate must be part of or securely attached to the record. If the notarial certificate is attached to the record using a separate sheet of paper, the attachment must contain a description of the record that includes at a minimum the title or type of record, the date of the record, the number of pages of the record and any additional signers of the record other than those named in the notarial certificate. If a notarial act is performed regarding an electronic record, the certificate must be affixed to or logically associated with the electronic record. If the secretary of state has established standards pursuant to section 41-275 for attaching, affixing or logically associating the certificate, the process must conform to the standards.

§ 41-265 Short form certificates

The following short form certificates of notarial acts are sufficient for the purposes indicated, if completed with the information required by section 41-264, subsections A and B:

For an acknowledgment in an individual capacity:

State of _____________________________________________

(County) of ___________________________________________

This record was acknowledged before me on _____________

Date

by ___________________________________

Name(s) of individual(s)

Signature of notarial officer

Stamp

(_____________________________________)

Title of office

(My commission expires: _____________)

For an acknowledgment in a representative capacity:

State of _________________________________________

(County) of ______________________________________

This record was acknowledged before me on _____________

Date

by ____________________________________________________

Name(s) of individual(s)

as (type of authority, such as officer or trustee) of (name of party on behalf of whom record was executed).

Signature of notarial officer

Stamp

(_______________________________________)

Title of office

(My commission expires: _______________)

For a verification on oath or affirmation:

State of _________________________________________

(County) of ______________________________________

Signed and sworn to (or affirmed) before me on ___________

Date

by ________________________________________________________

Name(s) of individual(s) making statement

Signature of notarial officer

Stamp

(_________________________________________)

Title of office

(My commission expires: __________________)

For witnessing or attesting a signature:

State of _________________________________________

(County) of ______________________________________

Signed (or attested) before me on ________________

Date

by _______________________________________________

Name(s) of individual(s)

Signature of notarial officer

Stamp

(__________________________________________)

Title of office

(My commission expires: ___________________)

For certifying a copy of a record:

State of ________________________________________

(County) of _____________________________________

I certify that this is a true and correct copy of a record in the possession of _________________________________.

Dated _______________________________

Signature of notarial officer

Stamp

(____________________________________)

Title of office

(My commission expires: _____________)

For certifying a tangible copy of an electronic record:

State of _______________________________________________

(County) of ____________________________________________ I certify that the foregoing copy of a record (entitled ________) (dated _______) and containing ________ pages is an accurate copy of an electronic record.

Dated ____________________________________

Signature of notarial officer

Stamp

(_________________________________________)

Title of office

(My commission expires: __________________)

§ 41-266 Official stamp

A. The official stamp of a notary public must:

Include 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 notary public's commission, the commission expiration date and other information required by the secretary of state.
Be capable of being copied together with the record to which it is affixed or attached or with which it is logically associated.

B. A notary public's official stamp may be any shape. The physical image of an official stamp created by a physical stamping device must be not more than one and one-half inches high and two and one-half inches wide and it must include an image of the great seal of the state of Arizona. The electronic image of an official stamp created by an electronic stamping device must be legible when reproduced together with the record with which it is logically associated.

C. A notary public may not affix or attach the notary public's official stamp over the notary public's signature or over any other signature on the record that is the subject of the notarial act.

D. The official stamp of a notary public is an official seal of office for the purposes of the laws of this state.

§ 41-267 Stamping device; violation; classification

A. A notary public is responsible for the security of the notary public's stamping device and may not allow another individual to use the device to perform a notarial act. On resignation from, or the revocation or expiration of, the notary public's commission, the notary public shall disable any electronic stamping device by destroying, erasing or securing it against use in a manner that renders it unusable. On the death or adjudication of incompetency of a notary public, the notary public's personal representative or guardian or any other person knowingly in possession of any electronic stamping device shall render it unusable by destroying, erasing or securing it against use in a manner that renders it unusable.

B. A vendor of stamping devices may not provide a stamping device to an individual unless the individual presents a copy of the individual's commission. The vendor must retain the copy for four years.

C. A notary public may possess only one physical stamping device for use with notarial acts performed regarding tangible records. A notary public may possess an embosser in addition to the notary public's physical stamping device. A notary public may use an embosser only in conjunction with the notary public's physical stamping device. An embosser or an impression made by the embosser is not an official seal of office for the purposes of the laws of this state.

D. A person who knowingly violates subsection B of this section is guilty of a class 6 felony. A person who violates subsection C of this section is guilty of a class 3 misdemeanor.

§ 41-268 Notification regarding performance of notarial act on electronic record; selection of technology; acceptance of tangible copy of electronic record

A. A notary public may select one or more tamper-evident technologies to perform notarial acts with respect to electronic records. A person may not require a notary public to perform a notarial act with respect to an electronic record with a technology that the notary public has not selected.

B. Before a notary public performs the notary public's initial notarial act with respect to an electronic record, a notary public shall notify the secretary of state that the notary public will be performing notarial acts with respect to electronic records and identify the technology the notary public intends to use. If the secretary of state has established standards for approval of technology pursuant to section 41-275, the technology must conform to the standards. If the technology conforms to the standards, the secretary of state shall approve the use of the technology.

C. A county recorder shall accept for recording a tangible copy of an electronic record containing a notarial certificate as satisfying any requirement that a record accepted for recording be an original, if the notarial officer executing the notarial certificate certifies that the tangible copy is an accurate copy of the electronic record.

§ 41-269 Commission as notary public; confidential information; qualifications; assurance; no immunity or benefit

A. An individual qualified under subsection B of this section may apply to the secretary of state for a commission as a notary public. The applicant shall comply with and provide the information required by rules established by the secretary of state and pay any application fee. Except for the applicant's name and business address, all information provided on the application is confidential and may not be disclosed to any person other than the applicant, the applicant's guardian or personal representative or an employee or officer of the federal, state or local government who is acting in an official capacity. The secretary of state shall use the information provided on the application only for carrying out the purposes of this article.

B. An applicant for a commission as a notary public must:

Be at least eighteen years of age.
Be a citizen or permanent legal resident of the United States.
Be a resident of this state for income tax purposes and claim the individual's residence in this state as the individual's primary residence on state and federal tax returns.
Be able to read, write and understand English.
Not be disqualified to receive a commission under section 41-271.
Have passed the examination described in section 41-270 if required by the secretary of state.
Keep as a reference a manual that is approved by the secretary of state and that describes the duties, authority and ethical responsibilities of a notary public.

C. Before a commission as a notary public is issued, an applicant for the commission shall execute an oath of office and submit it to the secretary of state.

D. Before issuance of a commission as a notary public, the applicant for a commission shall submit to the secretary of state an assurance in the form of a surety bond in the amount of $5,000. The assurance must be issued by a surety or other entity licensed or authorized to do business in this state. The assurance must cover acts performed during the term of the notary public's commission and must be in the form prescribed by the secretary of state. If a notary public violates any law with respect to notaries public in this state, the surety or issuing entity is liable under the assurance. The surety or issuing entity shall give thirty days' notice to the secretary of state before canceling the assurance. The surety or issuing entity shall notify the secretary of state not later than thirty days after making a payment to a claimant under the assurance. A notary public may perform notarial acts in this state only during the period that a valid assurance is on file with the secretary of state. An employer may not cancel the assurance of any notary public who is an employee and who leaves such employment.

E. On compliance with this section, the secretary of state shall issue a commission as a notary public to an applicant for a term of four years.

F. A commission to act as a notary public authorizes the notary public to perform notarial acts. The commission does not provide the notary public any immunity or benefit conferred by the laws of this state on public officials or employees.

G. A notary public is a public officer commissioned by this state and all of the following apply without regard to whether the notary public's employer or any other person has paid the fees and costs for the commissioning of the notary public, including costs for a stamping device or journal:

A notary public's stamping device, commission and any journal that contains only public record entries remain the property of the notary public.
A notary public may perform notarial acts outside the workplace of the notary's employer except during those times normally designated as the notary public's hours of duty for that employer. All fees received by a notary public for notarial services provided while not on duty remain the property of the notary public.
An employer of a notary public may not limit the notary public's services to customers or other persons designated by the employer.

H. This state or any political subdivision of this state may pay the fees and costs for the commissioning of a notary public who is an employee of this state or any political subdivision of this state and who performs notarial acts in the course of the notary public's employment or for the convenience of public employees.

§ 41-270 Examination of notary public; fee

A. The secretary of state may require an applicant for a commission as a notary public who does not hold a commission in this state, an applicant who is renewing a commission as a notary public or a notary public with a suspended commission to pass an examination administered by the secretary of state or an entity approved by the secretary of state. The examination must be based on the course of study described in subsection B of this section.

B. If the secretary of state requires an examination under subsection A of this section, the secretary of state or an entity approved by the secretary of state may offer a course of study to applicants who do not hold commissions as notaries public in this state, applicants who are renewing commissions as notaries public or notaries public with suspended commissions. The course must cover the laws, rules, procedures and ethics relevant to notarial acts.

C. The secretary of state may prescribe and assess a fee for administering a course of study and examination under this section. The secretary of state shall deposit the fees collected under this section in the notary education fund established by section 41-332.

§ 41-271 Grounds to deny, refuse to renew, revoke, suspend or condition commission of notary public

A. The secretary of state may deny, refuse to renew, revoke, suspend or impose a condition on a commission as notary public for any act or omission that demonstrates the individual lacks the competence or reliability to act as a notary public, including any of the following:

Failure to comply with this article.
A fraudulent, dishonest or deceitful misstatement or omission in the application for a commission as a notary public submitted to the secretary of state.
A conviction of the applicant or notary public of any felony or a crime involving fraud, dishonesty or deceit. A conviction after a plea of no contest is deemed to be a conviction for the purposes of this paragraph.
A finding against or admission of liability by the applicant or notary public in any legal proceeding or disciplinary action based on the applicant's or notary public's fraud, dishonesty or deceit.
Failure by the notary public to discharge any duty required of a notary public, whether by this article, rules of the secretary of state or federal or state law.
Use of false or misleading advertising or representation by the notary public that the notary has a duty, right or privilege that the notary does not have.
Violation by the notary public of a rule of the secretary of state regarding a notary public.
Denial, refusal to renew, revocation, suspension or conditioning of a notary public commission in another state.
Failure of the notary public to maintain an assurance as provided in section 41-269, subsection D.
Charging more than the fees authorized by this article or rule.
The return for insufficient funds or for any other reason for nonpayment of a check issued for the assurance filing fees or application fees to the secretary of state.
Failure to respond to any request for information or to comply with any investigation initiated by the secretary of state or the attorney general.
The prior revocation of a notary public commission in this state.

B. If the secretary of state denies, refuses to renew, revokes, suspends or imposes conditions on a commission as a notary public, the applicant or notary public is entitled to timely notice and a hearing in accordance with chapter 6, article 10 of this title. The denial of an application or revocation or suspension of a commission is an appealable agency action. If an applicant appeals the denial of an application, the applicant may not submit a new application for consideration while the appeal is pending. If an individual's commission as a notary public in this state is revoked, the individual may not submit a new application for commission for one year after the date of revocation.

C. The authority of the secretary of state to deny, refuse to renew, suspend, revoke or impose conditions on a commission as a notary public does not prevent a person from seeking and obtaining other criminal or civil remedies provided by law.

§ 41-272 Database of notaries public

A. The secretary of state shall maintain an electronic database of notaries public through which a person may verify the authority of a notary public to perform notarial acts.

B. The electronic database may indicate whether a notary public has notified the secretary of state that the notary public will be performing notarial acts on electronic records or for remotely located individuals under section 41-263.

§ 41-273 Prohibited acts; civil penalty; violation; classification

A. A commission as a notary public does not authorize an individual to:

Assist persons in drafting legal records, give legal advice or otherwise practice law.
Act as an immigration consultant or an expert on immigration matters.
Represent a person in a judicial or administrative proceeding relating to immigration to the United States, United States citizenship or related matters.
Receive compensation for performing any of the activities listed in this subsection.

B. A notary public may not engage in false or deceptive advertising.

C. A notary public, other than an attorney who is licensed to practice law in this state, may not use the term "notario" or "notario publico".

D. A notary public, other than an attorney who is licensed to practice law in this state, may not advertise or represent that the notary public may assist persons in drafting legal records, give legal advice or otherwise practice law. If a notary public who is not an attorney licensed to practice law in this state in any manner advertises or represents that the notary public offers notarial services, whether orally or in a record, including broadcast media, print media and the internet, the notary public shall include the following statement, or an alternative statement authorized or required by the secretary of state, in the advertisement or representation, prominently and in each language used in the advertisement or representation: "I am not an attorney licensed to practice law in this state. I am not allowed to draft legal records, give advice on legal matters, including immigration, or charge a fee for those activities." If the form of advertisement or representation is not broadcast media, print media or the internet and does not allow inclusion of the statement required by this subsection because of size, it must be displayed prominently or provided at the place of performance of the notarial act before the notarial act is performed.

E. Except as otherwise allowed by law, a notary public may not withhold access to or possession of an original record provided by a person that seeks performance of a notarial act by the notary public.

F. If a notary public, other than an attorney licensed to practice law in this state, performs an activity listed in subsection A of this section or otherwise performs the unauthorized practice of immigration and nationality law as defined in section 12-2701, the secretary of state shall impose a civil penalty of not more than $1,000 and permanently revoke the notary public's commission.

G. A notary public who violates subsection D of this section is guilty of a class 6 felony and the secretary of state shall permanently revoke the notary public's commission.

§ 41-274 Validity of notarial acts

Except as otherwise provided in section 41-252, subsection B and section 41-320, subsection B, the failure of a notarial officer to perform a duty or meet a requirement specified in this article does not invalidate a notarial act performed by the notarial officer. The validity of a notarial act under this article does not prevent an aggrieved person from seeking to invalidate the record or transaction that is the subject of the notarial act or from seeking other remedies based on the laws of this state other than this article or the laws of the United States. This section does not validate a purported notarial act performed by an individual who does not have the authority to perform notarial acts.

§ 41-275 Rules

A. The secretary of state may adopt rules to implement this article. On or before July 1, 2022, the secretary of state shall adopt rules under this section regarding the performance of notarial acts with respect to electronic records. Rules adopted regarding the performance of notarial acts with respect to electronic records may not require, or accord greater legal status or effect to, the implementation or application of a specific technology or technical specification. The rules may:

Prescribe the manner of performing notarial acts regarding tangible and electronic records.
Include provisions to ensure that any change to or tampering with a record bearing a certificate of a notarial act is self-evident.
Include provisions to ensure integrity in the creation, transmittal, storage or authentication of electronic records or signatures.
Prescribe the process of granting, renewing, conditioning, denying, suspending or revoking a notary public commission and assuring the trustworthiness of an individual holding a commission as a notary public.
Include provisions to prevent fraud or mistake in the performance of notarial acts.
Establish the process for approving and accepting surety bonds and other forms of assurance under section 41-269.
Provide for the administration of the examination under section 41-270, subsection A and the course of study under section 41-270, subsection B.

B. In adopting, amending or repealing rules about notarial acts with respect to electronic records, the secretary of state shall consider, so far as is consistent with this article:

The most recent standards regarding electronic records promulgated by national bodies, such as the national association of secretaries of state.
Standards, practices and customs of other jurisdictions that substantially enact this article.
The views of governmental officials and entities and other interested persons.

§ 41-276 Notary public commission in effect; authorization to perform electronic and remote online notarizations in effect

A. A commission as a notary public in effect on July 1, 2022 continues until its date of expiration. A notary public who applies to renew a commission as a notary public on or after July 1, 2022 is subject to and shall comply with this article. A notary public, in performing notarial acts after July 1, 2022, shall comply with this article.

B. An authorization issued by the secretary of state to perform electronic notarization or remote online notarizations in effect on July 1, 2022 continues until its date of expiration. A notary public who notifies the secretary of state that the notary public will be performing notarial acts with respect to electronic records or with respect to remotely located individuals on or after July 1, 2022 is subject to and shall comply with this article.

§ 41-277 Relation to electronic signatures in global and national commerce act

This article modifies, limits and supersedes the electronic signatures in global and national commerce act (P.L. 106-229; 114 Stat. 464; 15 United States Code sections 7001 through 7031) but does not modify, limit or supersede 15 United States Code section 7001(c) or authorize electronic delivery of any of the notices described in 15 United States Code section 7003(b).

Article 2 Notaries Public Miscellaneous Provisions

§ 41-314 Notary bond fund; purpose; exemption

A. The notary bond fund is established consisting of monies received pursuant to section 41-178.

B. The secretary of state shall administer the fund and spend monies in the fund in order to defray the cost of the secretary of state's office assuming the responsibilities associated with the processing and administration of notary bonds.

D. Monies in the fund are continuously appropriated and exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-316 Fees

A. The secretary of state shall establish fees that notaries public may charge for notarial acts. These fees shall be established by rules adopted pursuant to chapter 6 of this title.

B. Notaries public may be paid an amount up to the amount authorized for mileage expenses and per diem subsistence for state employees as prescribed by title 38, chapter 4, article 2.

C. A notary shall not advertise or charge or receive a fee for performing a notarial act except as specifically authorized by rule.

§ 41-317 Resignation; delivering notary seal, notarial journal and records; failure to comply; storing records; certified copies

A. A notary public shall submit the notary public's resignation in writing to the secretary of state.

B. On the resignation or revocation of a notarial commission or the death of a notary public, any physical stamping device, notarial journal and records, except those records of notarial acts that are not public record, shall be delivered by certified mail or other means providing a receipt to the secretary of state. If a notary public does not apply for reappointment, on expiration of the notarial commission, the device, the notarial journal and records shall be delivered to the secretary of state as required for resignation under this subsection. A notary public who neglects for three months thereafter to deposit such records, device and papers, or the personal representative of a deceased notary public who neglects for three months after appointment to deposit such records, device and papers, shall forfeit to the state not less than $50 or more than $500.

C. While a notary public is commissioned, a notary public shall keep all records and journals of the notary public's acts for at least five years after the date the notarial act was performed. On receipt of the records and journals from a notary public who no longer is commissioned, the secretary of state shall keep all records and journals of notaries public deposited in the secretary of state's office for five years and shall give certified copies thereof when required, and for the copy certifications the secretary of state shall receive the same fees as are by law allowed to notaries public. The copy certifications shall be as valid and effectual as if given by a notary public.

§ 41-318 Wilful destruction of records; penalty

Any person who knowingly destroys, defaces or conceals any journal entry or records belonging to the office of a notary public shall forfeit to the state an amount not exceeding five hundred dollars and shall be liable for damages to any party injured thereby.

§ 41-319 Journal

A. A notary public shall keep a paper journal to chronicle all notarial acts performed regarding tangible records. A notary public shall keep either a paper journal or one or more electronic journals to chronicle all notarial acts performed regarding electronic records. Except as prescribed by subsection E of this section, a notary public shall keep only one paper journal at a time. The notary public shall record all notarial acts in chronological order. The notary public shall furnish, when requested, a certified copy of any public record in the notary public's journal. Records of notarial acts that violate the attorney-client privilege or that are confidential pursuant to federal or state law are not a public record. Each journal entry shall include at least:

The date of the notarial act.
A description of the document and type of notarial act.
The printed full name and address of each individual for whom a notarial act is performed.
If a paper journal is used, the signature of each individual for whom a notarial act is performed.
The type of satisfactory evidence of identity presented to the notary public by each individual for whom a notarial act is performed, or a notation that the notary public's personal knowledge of the individual was used as satisfactory evidence of identity.
A description of the identification card or document, if any, including its date of issuance or expiration.
The fee, if any, charged for the notarial act.

B. If a notary public has personal knowledge of the identity of a signer, the notary public shall retain a paper or electronic copy of the notarized documents for each notarial act in lieu of making a journal entry or the notary public shall make a journal entry pursuant to the requirements of subsection A, paragraphs 1, 2, 3, 4, 5 and 7 of this section.

C. Except for notarial acts performed for remotely located individuals under section 41-263, if a notary public performs more than one notarization for an individual within a six month period, the notary public shall have the individual provide satisfactory evidence of identity as required under section 41-255 the first time the notary performs the notarization for the individual but may not require satisfactory evidence of identity or the individual to sign the journal for subsequent notarizations performed for the individual during the six month period.

D. If a notary public performs more than one notarization of the same type for a signer either on similar records or within the same record and at the same time, the notary public may group the records together and make one journal entry for the transaction.

E. If one or more entries in a notary public's journal are not public records, the notary public shall keep one journal that contains entries that are not public records and one journal that contains entries that are public records. If a notary public keeps only one journal, that journal is presumed to be a public record. A notary public's journal that contains entries that are not public records is the property of the employer of that notary public and shall be retained by that employer if the notary public leaves that employment. A notary public's journal that contains only public records is the property of the notary public without regard to whether the notary public's employer purchased the journal or provided the fees for the commissioning of the notary public.

F. Except as provided in subsections A and E of this section, the notary public's journal is a public record that may be viewed by or copied for any member of the public, but only on presentation to the notary public of a written request that details the month and year of the notarial act, the name of the individual whose signature was notarized and the type of record or transaction.

§ 41-320 Competency of bank and corporation notaries

A. It is lawful for a notary public who is a stockholder, director, officer or employee of a corporation to take the acknowledgment or oath of any party to any record executed to or by the corporation, or to administer an oath to any other stockholder, director, officer, employee or agent of the corporation, or to protest for nonacceptance or nonpayment of bills of exchange, drafts, checks, notes and other negotiable instruments that may be owned or held for collection by the corporation.

B. It is unlawful for any notary public to take the acknowledgment of a record executed by or to a corporation of which the notary public is a stockholder, director, officer or employee, where the notary public is a party to the record, either individually or as a representative of the corporation, or to protest any negotiable instrument owned or held for collection by the corporation, where the notary is individually a party to the instrument. A notarial act performed in violation of this subsection is voidable.

§ 41-323 Change of address; lost, stolen or compromised journal or seal; civil penalty; presumption; exception

A. Within thirty days after the change of a notary public's mailing, business or residential address, the notary public shall deliver to the secretary of state, by certified mail or other means providing a receipt, a signed notice of the change that provides both the old and new addresses.

B. Within ten days after the loss, theft or compromise of an official journal or stamping device, the notary public shall deliver to the secretary of state, by certified mail or other means providing a receipt, a signed notice of the loss, theft or compromise. The notary also shall inform the appropriate law enforcement agency in the case of theft.

C. If a notary public fails to comply with subsection A or B of this section, the notary public has failed to fully and faithfully discharge the duties of a notary public. If the notary public failed to comply with subsection A of this section, the secretary of state may impose a civil penalty of $25 against the notary. If the notary public failed to comply with subsection B of this section, the secretary of state shall impose a civil penalty of $1,000 against the notary. The notary public shall pay any civil penalty imposed by the secretary of state pursuant to this subsection before the renewal of the notary's commission. Failure to pay a penalty may be referred to the attorney general for collection.

D. In a judicial proceeding where the identity of a party to a notarized instrument is in question, the official journal of the notary public is lost, stolen or compromised and the notary complied with this section, a presumption shall be given to the validity of the identity of the party who signed the instrument. If it is determined that the official journal never existed or that the notary public failed to comply with this section, no presumption shall apply that the identity of the party who signed the notarized instrument in question is valid.

E. In an action in which the validity of a notarized document is at issue and it is determined that the notary public did not comply with this section, the court shall provide notice of such findings to the secretary of state and the county attorney for the county in which the violation occurred.

§ 41-324 Court reporters; notarial acts

A. Court reporters who administer oaths and affirmations in judicial proceedings are exempt from the provisions of this chapter other than section 41-269, subsections C and D. Court reporters who are commissioned as notaries and who perform notarial acts outside of judicial proceedings are subject to all provisions of this chapter and of other laws of this state that regulate notaries public.

B. A court reporter who prepares a transcript of a judicial proceeding shall attach a certificate page to the transcript. On the certificate page, the court reporter shall attest to the fact that the reporter administered an oath or affirmation to each witness whose testimony appears in the transcript.

C. An affidavit of nonappearance that is prepared by a court reporter does not need to be witnessed by a notary public.

§ 41-325 Evidence of authenticity of a notarial act performed in this state

A. The authenticity of the official notarial seal and signature of a notary may be evidenced by either:

A certificate of authority from the secretary of state authenticated as necessary.
An apostille from the secretary of state in the form prescribed by the Hague convention of October 5, 1961 abolishing the requirement of legalization of foreign public documents.

B. An apostille as specified by the Hague convention shall be attached to any document that requires authentication and that is sent to a nation that has signed and ratified this convention.

§ 41-326 Apostille

An apostille prescribed by the Hague convention, as cited in 28 United States Code in annotations to rule 44 of the federal rules of civil procedure, shall be in the form of a square with sides at least nine centimeters long and shall contain exactly the following wording:

Apostille

(Convention de la haye du 5 Octobre 1961)

Country: ___________________________________________

This public document

Has been signed by ___________________________________
Acting in the capacity of ___________________________
Bears the seal/stamp of ______________________________

Certified

At ____________________
The ____________________
By ___________________________________________________
No. _________________________________________________
Seal/stamp
Signature _______________________

§ 41-327 Surname change; notification; continuation of commission

A notary public who has a change of surname may continue to use the official stamp and commission in the notary public's prior name until that commission expires. The notary public shall sign the changed surname on the line that is designated for the notary public's signature on the notarial certificate. Immediately below that signature, the notary public shall sign the name under which the notary was commissioned. The notary public shall notify the secretary of state's office within thirty days after the notary public's change of surname. Failure to notify the secretary of state of this change of surname is evidence of the notary public's failure to fully and faithfully discharge the duties of a notary public.

§ 41-331 Complaints; investigations

A. Any person may make a complaint to the office of the secretary of state regarding a notary public. The secretary of state shall receive any complaints and shall provide notice of those complaints to the office of the attorney general who shall investigate and take action on all complaints involving allegations of any violations of this article.

B. A notary's failure to respond to an investigation is a failure by the notary to fully and faithfully discharge the responsibilities and duties of a notary.

§ 41-332 Notary education fund

The notary education fund is established consisting of monies deposited pursuant to section 41-270. The secretary of state shall administer the fund. Monies in the fund are subject to legislative appropriation.

§ 41-333 Impersonation of notary public

Any person who knowingly acts as or otherwise intentionally impersonates a notary public while not lawfully appointed and commissioned to perform notarial acts is guilty of impersonating a public servant pursuant to section 13-2406.

§ 41-334 Notarial services; notarial acts; businesses; definition

A. If an entity does not provide an option to notarize documents at a physical location without charge or cost, individuals seeking notarization may use the services of any notarial officer who is authorized to perform the notarial act pursuant to the laws of the notarial officer's commissioning state.

B. For the purposes of this section, "entity":

Has the same meaning prescribed in section 10-140.
Includes a business organization that maintains a physical location in this state for the purpose of direct interaction with customers.

Chapter 2.1 Constitutional Defense

Article 1 General Provisions

§ 41-401 Constitutional defense council; members; powers; revolving fund; definitions

A. The constitutional defense council is established consisting of the governor or his designee, a person appointed by the president of the senate, a person appointed by the speaker of the house of representatives, the chairman of the house of representatives committee on states' rights and mandates or its successor committee as an advisory member and the chairman of the senate committee on government reform or its successor committee as an advisory member.

B. The purpose of the council is restoring, maintaining, and advancing the state's sovereignty and authority over issues that affect this state and the well-being of its citizens by taking any action it deems appropriate.

C. Meetings of the council may be called by any member, and decisions of the council shall be made by a majority vote of the members.

D. The council may hold meetings or hearings regarding any of the following:

Federal mandates.
Court rulings.
The authority granted to, or assumed by, the federal government.
Laws, regulations and practices of the federal government.
Any other activity deemed appropriate given the purposes of the council.

E. The council may require the attorney general or his designee to provide testimony on potential legal actions that would enhance the state's sovereignty or authority on issues affecting this state and the well-being of its citizens.

F. By majority vote, the council may initiate and pursue, including the unconditional right of intervention, in the name of this state any action concerning a law, regulation, order, policy or decision of the United States or any agency of the United States, including court rulings, that the council determines will further its purposes.

G. The council may select and employ attorneys to implement the purposes of this chapter. The attorney general may assist any council attorney in any manner deemed appropriate by the council. When requested by the council, agencies and departments of this state, except the department of law, shall provide reasonable personnel and resources to assist in any matter pursued by the council. The council shall not hire permanent staff.

H. A constitutional defense council revolving fund is established to be administered by the director of the department of administration under the conditions and for the purposes prescribed by this section. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. Monies in the fund shall be used by the director of the department of administration to pay the fees and costs of legal actions initiated pursuant to subsection F or G of this section, and other expenses authorized by a majority vote of the council, including the reasonable expenses of expert witnesses and the reasonable cost of any study, analysis or report. The chair of the council shall transmit all claims approved by a majority vote of the council to the director of the department of administration for payment. Members are not eligible to receive compensation but are eligible to receive reimbursement for expenses pursuant to title 38, chapter 4, article 2 from the constitutional defense council revolving fund.

I. On or before the fifteenth day of each month, the director of the department of administration shall cause to be filed with the council members, the president of the senate, the speaker of the house of representatives, the joint legislative budget committee and the governor a full and complete account of the receipts and disbursements for the constitutional defense council revolving fund for the preceding month. With five business days' notice, the council may order an attorney employed by the council to cease all work to be charged to the constitutional defense council revolving fund.

J. The constitutional defense council is exempt from chapter 23 of this title, relating to the procurement code, for matters relating to the purposes of the council.

K. The council shall submit a report on December 1 of each year to the speaker of the house of representatives, the president of the senate and the governor that summarizes the council's activities.

L. The constitutional defense council shall brief the joint legislative budget committee in executive session regarding contracts for legal representation over the amount of fifty thousand dollars. Information provided in executive session shall remain confidential until the contract award is made pursuant to this section.

M. In this section:

"Advisory member" means a member who gives advice to the other members of the council at meetings of the council but who is not eligible to vote, is not a member of the council for purposes of determining whether a quorum is present and is not eligible to receive any compensation or reimbursement of expenses by the council.
"Council" means the constitutional defense council.

Article 2 Compact for a Balanced Budget

§ 41-451 Adoption of compact; text of compact

The compact for a balanced budget is enacted into law as follows:

COMPACT FOR A BALANCED BUDGET

The state of Arizona enacts, adopts and agrees to be bound by the following compact:

ARTICLE I

DECLARATION OF POLICY, PURPOSE AND INTENT

Whereas, every state enacting, adopting and agreeing to be bound by this compact intends to ensure that their respective legislature's use of the power to originate a balanced budget amendment under article V of the Constitution of the United States will be exercised conveniently and with reasonable certainty as to the consequences thereof.

Now, therefore, in consideration of their expressed mutual promises and obligations, be it enacted by every state enacting, adopting and agreeing to be bound by this compact, and resolved by each of their respective legislatures, as the case may be, to exercise herewith all of their respective powers as set forth herein notwithstanding any law to the contrary.

ARTICLE II

DEFINITIONS

Section 1. "Compact" means this "compact for a balanced budget."

Section 2. "Convention" means the convention for proposing amendments organized by this compact under article V of the Constitution of the United States and, where contextually appropriate to ensure the terms of this compact are not evaded, any other similar gathering or body, which might be organized as a consequence of Congress receiving the application set out in this compact and claim authority to propose or effectuate any amendment, alteration or revision to the Constitution of the United States. This term does not encompass a convention for proposing amendments under article V of the Constitution of the United States that is organized independently of this compact based on the separate and distinct application of any state.

Section 3. "State" means one of the several states of the United States. Where contextually appropriate, the term "state" shall be construed to include all of its branches, departments, agencies, political subdivisions, and officers and representatives acting in their official capacity.

Section 4. "Member state" means a state that has enacted, adopted and agreed to be bound to this compact. For any state to qualify as a member state with respect to any other state under this compact, each such state must have enacted, adopted and agreed to be bound by substantively identical compact legislation.

Section 5. "Compact notice recipients" means the archivist of the United States, the president of the United States, the president of the United States senate, the office of the secretary of the United States senate, the speaker of the United States house of representatives, the office of the clerk of the United States house of representatives, the chief executive officer of each state, and the presiding officer(s) of each house of the legislatures of the several states.

Section 6. Notice. All notices required by this compact shall be by U.S. certified mail, return receipt requested, or an equivalent or superior form of notice, such as personal delivery documented by evidence of actual receipt.

Section 7. "Balanced budget amendment" means the following:

"Article __

Section 1. Total outlays of the government of the United States shall not exceed total receipts of the government of the United States at any point in time unless the excess of outlays over receipts is financed exclusively by debt issued in strict conformity with this article.

Section 2. Outstanding debt shall not exceed authorized debt, which initially shall be an amount equal to 105 percent of the outstanding debt on the effective date of this article. Authorized debt shall not be increased above its aforesaid initial amount unless such increase is first approved by the legislatures of the several states as provided in section 3.

Section 3. From time to time, Congress may increase authorized debt to an amount in excess of its initial amount set by section 2 only if it first publicly refers to the legislatures of the several states an unconditional, single subject measure proposing the amount of such increase, in such form as provided by law, and the measure is thereafter publicly and unconditionally approved by a simple majority of the legislatures of the several states, in such form as provided respectively by state law; provided that no inducement requiring an expenditure or tax levy shall be demanded, offered or accepted as a quid pro quo for such approval. If such approval is not obtained within sixty (60) calendar days after referral then the measure shall be deemed disapproved and the authorized debt shall thereby remain unchanged.

Section 4. Whenever the outstanding debt exceeds 98 percent of the debt limit set by section 2, the president shall enforce said limit by publicly designating specific expenditures for impoundment in an amount sufficient to ensure outstanding debt shall not exceed the authorized debt. Said impoundment shall become effective thirty (30) days thereafter, unless Congress first designates an alternate impoundment of the same or greater amount by concurrent resolution, which shall become immediately effective. The failure of the President to designate or enforce the required impoundment is an impeachable misdemeanor. Any purported issuance or incurrence of any debt in excess of the debt limit set by section 2 is void.

Section 5. No bill that provides for a new or increased general revenue tax shall become law unless approved by a two-thirds roll call vote of the whole number of each house of Congress. However, this requirement shall not apply to any bill that provides for a new end user sales tax which would completely replace every existing income tax levied by the government of the United States; or for the reduction or elimination of an exemption, deduction, or credit allowed under an existing general revenue tax.

Section 6. For purposes of this article, "debt" means any obligation backed by the full faith and credit of the government of the United States; "outstanding debt" means all debt held in any account and by any entity at a given point in time; "authorized debt" means the maximum total amount of debt that may be lawfully issued and outstanding at any single point in time under this article; "total outlays of the government of the United States" means all expenditures of the government of the United States from any source; "total receipts of the government of the United States" means all tax receipts and other income of the government of the United States, excluding proceeds from its issuance or incurrence of debt or any type of liability; "impoundment" means a proposal not to spend all or part of a sum of money appropriated by Congress; and "general revenue tax" means any income tax, sales tax, or value-added tax levied by the government of the United States excluding imposts and duties.

Section 7. This article is immediately operative upon ratification, self-enforcing, and Congress may enact conforming legislation to facilitate enforcement."

ARTICLE III

COMPACT MEMBERSHIP AND WITHDRAWAL

Section 1. This compact governs each member state to the fullest extent permitted by their respective constitutions, superseding and repealing any conflicting or contrary law.

Section 2. By becoming a member state, each such state offers, promises and agrees to perform and comply strictly in accordance with the terms and conditions of this compact, and has made such offer, promise and agreement in anticipation and consideration of, and in substantial reliance upon, such mutual and reciprocal performance and compliance by each other current and future member state, if any. Accordingly, in addition to having the force of law in each member state upon its respective effective date, this compact and each of its articles shall also be construed as contractually binding each member state when:

(a) At least one other state has likewise become a member state by enacting substantively identical legislation adopting and agreeing to be bound by this compact; and

(b) Notice of such state's member state status is or has been seasonably received by the compact administrator, if any, or otherwise by the chief executive officer of each other member state.

Section 3. For purposes of determining member state status under this compact, as long as all other provisions of the compact remain identical and operative on the same terms, legislation enacting, adopting and agreeing to be bound by this compact shall be deemed and regarded as "substantively identical" with respect to such other legislation enacted by another state notwithstanding:

(a) Any difference in section 2 of article IV with specific regard to the respectively enacting state's own method of appointing its member to the commission;

(b) Any difference in section 5 of article IV with specific regard to the respectively enacting state's own obligation to fund the commission;

(c) Any difference in sections 1 and 2 of article VI with specific regard to the number and identity of each delegate respectively appointed on behalf of the enacting state, provided that no more than three delegates may attend and participate in the convention on behalf of any state; or

(d) Any difference in section 7 of article X with specific regard to the respectively enacting state as to whether section 1 of article V of this compact shall survive termination of the compact, and thereafter become a continuing resolution of the legislature of such state applying to Congress for the calling of a convention of the states under article V of the Constitution of the United States, under such terms and limitations as may be specified by such state.

Section 4. When fewer than three-fourths of the states are member states, any member state may withdraw from this compact by enacting appropriate legislation, as determined by state law, and giving notice of such withdrawal to the compact administrator, if any, or otherwise to the chief executive officer of each other member state. A withdrawal shall not affect the validity or applicability of the compact with respect to remaining member states, provided that there remain at least two such states. However, once at least three-fourths of the states are member states, then no member state may withdraw from the compact prior to its termination absent unanimous consent of all member states.

ARTICLE IV

COMPACT COMMISSION AND COMPACT ADMINISTRATOR

Section 1. Nature of the compact commission. The compact commission ("commission") is hereby established. It has the power and duty:

(a) To appoint and oversee a compact administrator;

(b) To encourage states to join the compact and congress to call the convention in accordance with this compact;

(d) To oversee the convention's logistical operations as appropriate to ensure this compact governs its proceedings;

(e) To oversee the defense and enforcement of the compact in appropriate legal venues;

(f) To request funds and to disburse those funds to support the operations of the commission, compact administrator, and convention; and

(g) To cooperate with any entity that shares a common interest with the commission and engages in policy research, public interest litigation or lobbying in support of the purposes of the compact. The commission shall only have such implied powers as are essential to carrying out these express powers and duties. It shall take no action that contravenes or is inconsistent with this compact or any law of any state that is not superseded by this compact. It may adopt and publish corresponding bylaws and policies.

Section 2. Commission membership. The commission initially consists of three unpaid members. Each member state may appoint one member to the commission through an appointment process to be determined by their respective chief executive officer until all positions on the commission are filled. Positions shall be assigned to appointees in the order in which their respective appointing states became member states. The bylaws of the commission may expand its membership to include representatives of additional member states and to allow for modest salaries and reimbursement of expenses if adequate funding exists.

Section 3. Commission action. Each commission member is entitled to one vote. The commission shall not act unless a majority of its appointed membership is present, and no action shall be binding unless approved by a majority of the commission's appointed membership. The commission shall meet at least once a year, and may meet more frequently.

Section 4. First order of business. The commission shall at the earliest possible time elect from among its membership a chairperson, determine a primary place of doing business, and appoint a compact administrator.

Section 5. Funding. The commission and the compact administrator's activities shall be funded exclusively by each member state, as determined by their respective state law, or by voluntary donations.

Section 6. Compact administrator. The compact administrator has the power and duty:

(a) To timely notify the states of the date, time and location of the convention;

(b) To organize and direct the logistical operations of the convention;

(d) To formulate, transmit, and maintain all official notices, records, and communications relating to this compact.

The compact administrator shall only have such implied powers as are essential to carrying out these express powers and duties; and shall take no action that contravenes or is inconsistent with this compact or any law of any state that is not superseded by this compact. The compact administrator serves at the pleasure of the commission and must keep the commission seasonably apprised of the performance or nonperformance of the terms and conditions of this compact. Any notice sent by a member state to the compact administrator concerning this compact shall be adequate notice to each other member state provided that a copy of said notice is seasonably delivered by the compact administrator to each other member state's respective chief executive officer.

Section 7. Notice of key events. Upon the occurrence of each of the following described events, or otherwise as soon as possible, the compact administrator shall immediately send the following notices to all compact notice recipients, together with certified conforming copies of the chaptered version of this compact as maintained in the statutes of each member state:

(a) Whenever any state becomes a member state, notice of that fact shall be given;

(b) Once at least three-fourths of the states are member states, notice of that fact shall be given together with a statement declaring that the legislatures of at least two-thirds of the several states have applied for a convention for proposing amendments under article V of the Constitution of the United States, petitioning Congress to call the convention contemplated by this compact, and further requesting cooperation in organizing the same in accordance with this compact;

(c) Once Congress has called the convention contemplated by this compact, and whenever the date, time and location of the convention has been determined, notice of that fact shall be given together with the date, time and location of the convention and other essential logistical matters;

(d) Upon approval of the balanced budget amendment by the convention, notice of that fact shall be given together with the transmission of certified copies of such approved proposed amendment and a statement requesting Congress to refer the same for ratification by three-fourths of the legislatures of the several states under article V of the Constitution of the United States (however, in no event shall any proposed amendment other than the balanced budget amendment be transmitted); and

(e) When any article of this compact prospectively ratifying the balanced budget amendment is effective in any member state, notice of the same shall be given together with a statement declaring such ratification and further requesting cooperation in ensuring that the official record confirms and reflects the effective corresponding amendment to the Constitution of the United States.

However, whenever any member state enacts appropriate legislation, as determined by the laws of the respective state, withdrawing from this compact, the compact administrator shall immediately send certified conforming copies of the chaptered version of such withdrawal legislation as maintained in the statutes of each such withdrawing member state, solely to each chief executive officer of each remaining member state, giving notice of such withdrawal.

Section 8. Cooperation. The commission, member states and compact administrator shall cooperate with each other and give each other mutual assistance in enforcing this compact and shall give the chief law enforcement officer of each other member state any information or documents that are reasonably necessary to facilitate the enforcement of this compact.

Section 9. This article does not take effect until there are at least two member states.

ARTICLE V

RESOLUTION APPLYING FOR CONVENTION

Section 1. Be it resolved, as provided for in article V of the Constitution of the United States, the legislature of each member state herewith applies to Congress for the calling of a convention for proposing amendments limited to the subject matter of proposing for ratification the balanced budget amendment.

Section 2. Congress is further petitioned to refer the balanced budget amendment to the states for ratification by three-fourths of their respective legislatures.

Section 3. This article does not take effect until at least three-fourths of the several states are member states.

ARTICLE VI

DELEGATE APPOINTMENT, LIMITATIONS AND INSTRUCTIONS

Section 1. Number of delegates. This member state shall be entitled to three delegates to represent its sovereign interests at the convention.

Section 2. Identity. The governor, speaker of the house of representatives and president of the senate of this member state on the enactment date of this compact, or their respective designee, as identified in a sworn affidavit executed by such officer, are each appointed in an individual capacity to represent this member state at the convention as its sole and exclusive delegates. A majority vote of this delegation shall serve to decide any issue at the convention on behalf of this member state.

Section 3. Replacement or recall of delegates. A delegate appointed hereunder may be replaced or recalled by the legislature of his or her respective state at any time for good cause, such as criminal misconduct or the violation of this compact. If replaced or recalled, any delegate previously appointed hereunder must immediately vacate the convention and return to their respective state's capitol.

Section 4. Oath. The power and authority of a delegate under this article may only be exercised after the convention is first called by Congress in accordance with this compact and such appointment is duly accepted by such appointee publicly taking the following oath or affirmation: "I do solemnly swear (or affirm) that I accept this appointment and will act strictly in accordance with the terms and conditions of the compact for a balanced budget, the constitution of the state I represent, and the Constitution of the United States. I understand that violating this oath (or affirmation) forfeits my appointment and may subject me to other penalties as provided by law."

Section 5. Term. The term of a delegate hereunder commences upon acceptance of appointment and terminates upon the permanent adjournment of the convention, unless shortened by recall, replacement or forfeiture under this article. Upon expiration of such term, any person formerly serving as a delegate must immediately withdraw from and cease participation at the convention, if any is proceeding.

Section 6. Delegate authority. The power and authority of any delegate appointed hereunder is strictly limited:

(a) To introducing, debating, voting upon, proposing and enforcing the convention rules specified in this compact, as needed to ensure those rules govern the convention; and

(b) To introducing, debating, voting upon, and rejecting or proposing for ratification the balanced budget amendment. All actions taken by any delegate in violation of this section are void ab initio.

Section 7. Delegate authority. No delegate of any member state may introduce, debate, vote upon, reject or propose for ratification any constitutional amendment at the convention unless:

(a) The convention rules specified in this compact govern the convention and their actions; and

(b) The constitutional amendment is the balanced budget amendment.

Section 8. Delegate authority. The power and authority of any delegate at the convention does not include any power or authority associated with any other public office held by the delegate. Any person appointed to serve as a delegate shall take a temporary leave of absence, or otherwise shall be deemed temporarily disabled, from any other public office held by the delegate while attending the convention, and may not exercise any power or authority associated with any other public office held by the delegate while attending the convention. All actions taken by any delegate in violation of this section are void ab initio.

Section 9. Order of business. Before introducing, debating, voting upon, rejecting or proposing for ratification any constitutional amendment at the convention, each delegate of every member state must first ensure the convention rules in this compact govern the convention and their actions. Every delegate and each member state must immediately vacate the convention and notify the compact administrator by the most effective and expeditious means if the convention rules in this compact are not adopted to govern the convention and their actions.

Section 10. Forfeiture of appointment. If any member state or delegate violates any provision of this compact, then every delegate of that member state immediately forfeits his or her appointment, and shall immediately cease participation at the convention, vacate the convention, and return to his or her respective state's capitol.

Section 11. Expenses. A delegate appointed hereunder is entitled to reimbursement of reasonable expenses for attending the convention from his or her respective member state. No delegate may accept any other form of remuneration or compensation for service under this compact.

ARTICLE VII

CONVENTION RULES

Section 1. Nature of the convention. The convention shall be organized, construed and conducted as a body exclusively representing and constituted by the several states.

Section 2. Agenda of the convention. The agenda of the convention shall be entirely focused upon and exclusively limited to introducing, debating, voting upon, and rejecting or proposing for ratification the balanced budget amendment under the convention rules specified in this article and in accordance with the compact. It shall not be in order for the convention to consider any matter that is outside the scope of this agenda.

Section 3. Delegate identity and procedure. States shall be represented at the convention through duly appointed delegates. The number, identity and authority of delegates assigned to each state shall be determined by this compact in the case of member states or, in the case of states that are not member states, by their respective state laws. However, to prevent disruption of proceedings, no more than three delegates may attend and participate in the convention on behalf of any state. A certified chaptered conforming copy of this compact, together with government-issued photographic proof of identification, shall suffice as credentials for delegates of member states. Any commission for delegates of states that are not member states shall be based on their respective state laws, but it shall furnish credentials that are at least as reliable as those required of member states.

Section 4. Voting. Each state represented at the convention shall have one vote, exercised by the vote of that state's delegate in the case of states represented by one delegate, or, in the case of any state that is represented by more than one delegate, by the majority vote of that state's respective delegates.

Section 5. Quorum. A majority of the several states of the United States, each present through its respective delegate in the case of any state that is represented by one delegate, or through a majority of its respective delegates, in the case of any state that is represented by more than one delegate, shall constitute a quorum for the transaction of any business on behalf of the convention.

Section 6. Action by the convention. The convention shall only act as a committee of the whole, chaired by the delegate representing the first state to have become a member state, if that state is represented by one delegate, or otherwise by the delegate chosen by the majority vote of that state's respective delegates. The transaction of any business on behalf of the convention, including the designation of a secretary, the adoption of parliamentary procedures and the rejection or proposal of any constitutional amendment, requires a quorum to be present and a majority affirmative vote of those states constituting the quorum.

Section 7. Emergency suspension and relocation of the convention. In the event that the chair of the convention declares an emergency due to disorder or an imminent threat to public health and safety prior to the completion of the business on the agenda, and a majority of the states present at the convention do not object to such declaration, further convention proceedings shall be temporarily suspended, and the commission shall subsequently relocate or reschedule the convention to resume proceedings in an orderly fashion in accordance with the terms and conditions of this compact with prior notice given to the compact notice recipients.

Section 8. Parliamentary procedure. In adopting, applying and formulating parliamentary procedure, the convention shall exclusively adopt, apply or appropriately adapt provisions of the most recent editions of Robert's Rules of Order and the American Institute of Parliamentarians Standard Code of Parliamentary Procedure. In adopting, applying or adapting parliamentary procedure, the convention shall exclusively consider analogous precedent arising within the jurisdiction of the United States. Parliamentary procedures adopted, applied or adapted pursuant to this section shall not obstruct, override or otherwise conflict with this compact.

Section 9. Transmittal. Upon approval of the balanced budget amendment by the convention to propose for ratification, the chair of the convention shall immediately transmit certified copies of such approved proposed amendment to the compact administrator and all compact notice recipients, notifying them respectively of such approval and requesting congress to refer the same for ratification by the states under article V of the Constitution of the United States. However, in no event shall any proposed amendment other than the balanced budget amendment be transmitted as aforesaid.

Section 10. Transparency. Records of the convention, including the identities of all attendees and detailed minutes of all proceedings, shall be kept by the chair of the convention or secretary designated by the convention. All proceedings and records of the convention shall be open to the public upon request subject to reasonable regulations adopted by the convention that are closely tailored to preventing disruption of proceedings under this article.

Section 11. Adjournment of the convention. The convention shall permanently adjourn upon the earlier of twenty-four hours after commencing proceedings under this article or the completion of the business on its agenda.

ARTICLE VIII

PROHIBITION ON ULTRA VIRES CONVENTION

Section 1. Member states shall not participate in the convention unless:

(a) Congress first calls the convention in accordance with this compact; and

(b) The convention rules of this compact are adopted by the convention as its first order of business.

Section 2. Any proposal or action of the convention is void ab initio and issued by a body that is conducting itself in an unlawful and ultra vires fashion if that proposal or action:

(a) Violates or was approved in violation of the convention rules or the delegate instructions and limitations on delegate authority specified in this compact;

(b) Purports to propose or effectuate a mode of ratification that is not specified in article V of the Constitution of the United States; or

(c) Purports to propose or effectuate the formation of a new government. All member states are prohibited from advancing or assisting in the advancement of any such proposal or action.

Section 3. Member states shall not ratify or otherwise approve any proposed amendment, alteration or revision to the Constitution of the United States, which originates from the convention, other than the balanced budget amendment.

ARTICLE IX

RESOLUTION PROSPECTIVELY RATIFYING THE

BALANCED BUDGET AMENDMENT

Section 1. Each member state, by and through its respective legislature, hereby adopts and ratifies the balanced budget amendment.

Section 2. This article does not take effect until Congress effectively refers the balanced budget amendment to the states for ratification by three-fourths of the legislatures of the several states under article V of the Constitution of the United States.

ARTICLE X

CONSTRUCTION, ENFORCEMENT, VENUE, AND SEVERABILITY

Section 1. To the extent that the effectiveness of this compact or any of its articles or provisions requires the alteration of local legislative rules, drafting policies, or procedure to be effective, the enactment of legislation enacting, adopting and agreeing to be bound by this compact shall be deemed to waive, repeal, supersede, or otherwise amend and conform all such rules, policies or procedures to allow for the effectiveness of this compact to the fullest extent permitted by the Constitution of any affected member state.

Section 2. Date and location of the convention. Unless otherwise specified by Congress in its call, the convention shall be held in Dallas, Texas and commence proceedings at 9:00 a.m. central standard time on the sixth Wednesday after the latter of the effective date of article V of this compact or the enactment date of the congressional resolution calling the convention.

Section 3. In addition to all other powers and duties conferred by state law which are consistent with the terms and conditions of this compact, the chief law enforcement officer of each member state is empowered to defend the compact from any legal challenge, as well as to seek civil mandatory and prohibitory injunctive relief to enforce this compact; and shall take such action whenever the compact is challenged or violated.

Section 4. The exclusive venue for all actions in any way arising under this compact shall be in the United States district court for the northern district of Texas or the courts of the state of Texas within the jurisdictional boundaries of the foregoing district court. Each member state shall submit to the jurisdiction of said courts with respect to such actions. However, upon written request by the chief law enforcement officer of any member state, the commission may elect to waive this provision for the purpose of ensuring an action proceeds in the venue that allows for the most convenient and effective enforcement or defense of this compact. Any such waiver shall be limited to the particular action to which it is applied and not construed or relied upon as a general waiver of this provision. The waiver decisions of the commission under this provision shall be final and binding on each member state.

Section 5. The effective date of this compact and any of its articles is the latter of: (a) the date of any event rendering the same effective according to its respective terms and conditions; or (b) the earliest date otherwise permitted by law.

Section 6. Article VIII of this compact is hereby deemed non-severable prior to termination of the compact. However, if any other phrase, clause, sentence or provision of this compact, or the applicability of any other phrase, clause, sentence or provision of this compact to any government, agency, person or circumstance, is declared in a final judgment to be contrary to the Constitution of the United States, contrary to the state constitution of any member state, or is otherwise held invalid by a court of competent jurisdiction, such phrase, clause, sentence or provision shall be severed and held for naught, and the validity of the remainder of this compact and the applicability of the remainder of this compact to any government, agency, person or circumstance shall not be affected. Furthermore, if this compact is declared in a final judgment by a court of competent jurisdiction to be entirely contrary to the state constitution of any member state or otherwise entirely invalid as to any member state, such member state shall be deemed to have withdrawn from the compact, and the compact shall remain in full force and effect as to any remaining member state. Finally, if this compact is declared in a final judgment by a court of competent jurisdiction to be wholly or substantially in violation of article I, section 10, of the Constitution of the United States, then it shall be construed and enforced solely as reciprocal legislation enacted by the affected member states.

Section 7. Termination. This compact shall terminate and be held for naught when the compact is fully performed and the Constitution of the United States is amended by the balanced budget amendment. However, notwithstanding anything to the contrary set forth in this compact, in the event such amendment does not occur within seven (7) years after the first state passes legislation enacting, adopting and agreeing to be bound to this compact, the compact shall terminate as follows:

(a) The commission shall dissolve and wind up its operations within ninety (90) days thereafter, with the compact administrator giving notice of such dissolution and the operative effect of this section to the compact notice recipients; and

(b) Upon the completed dissolution of the commission, this compact shall be deemed terminated, repealed, void ab initio, and held for naught.

Section 8. Proposed termination date amendment. Independently from the foregoing legislation enacting, adopting and agreeing to be bound to the compact for a balanced budget, this state herewith conditionally enacts, proposes, offers, promises and agrees to perform and comply strictly with the following amendment to section 7 of article X of the compact for a balanced budget, and otherwise reaffirms its commitment to all other provisions of the compact for a balanced budget, if and when every member state: (a) has passed legislation either (1) manifesting such consent to the following amendment or (2) otherwise adopting the compact for a balanced budget as thereby amended; and (b) has given written notice of the passage of such legislation, including a certified copy of such legislation, through an authorized official to the compact administrator of the compact for a balanced budget, if any, or otherwise to the governor or, if none, the chief executive officer of each other member state:

"Section 7. Termination. This compact shall terminate and be held for naught when the compact is fully performed and the Constitution of the United States is amended by the balanced budget amendment. However, notwithstanding anything to the contrary set forth in this compact, in the event such amendment does not occur on or before April 12, 2031, the compact shall terminate as follows: (a) the commission shall dissolve and wind up its operations within ninety (90) days thereafter, with the compact administrator giving notice of such dissolution and the operative effect of this section to the compact notice recipients; and (b) upon the completed dissolution of the commission, this compact shall be deemed terminated, repealed, void ab initio, and held for naught except that the obligation to comply with article VIII of this compact shall survive such termination."

Chapter 3 Administrative Boards and Commissions

Article 1 Arizona State Parks Heritage Fund

§ 41-501 Definitions

In this article, unless the context otherwise requires:

"Fund" means the Arizona state parks heritage fund established by section 41-502.
"Historic preservation project" means a project for the preservation of archaeological or historic properties, artifacts, archives and collections that require stabilization, rehabilitation, restoration and maintenance, interpretation, education and program development.

§ 41-502 Arizona state parks heritage fund; exemption

A. The Arizona state parks heritage fund is established consisting of legislative appropriations, grants and donations.

B. The Arizona state parks board shall administer the fund. Monies in the fund are continuously appropriated. On notice from the Arizona state parks board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-503 Expenditures from fund; purpose; amounts

A. The Arizona state parks board, in consultation with the historical advisory commission, shall:

Establish criteria for the use of the monies in the fund.
Establish and revise as necessary the grant application process.
Review and evaluate grant applications.

B. The monies in the fund shall be used as follows:

Fifty percent on local, regional or state parks for outdoor recreation and open space development, restoration or renovation.
Thirty percent on local, regional and state historic preservation projects. The Arizona state parks board through the state historic preservation officer shall administer monies provided under this paragraph.
Ten percent on local, regional and state nonmotorized trails.
Ten percent on outdoor and environmental education.

C. An entity that receives monies under this section may not receive more than twenty percent of the monies available in each category in any fiscal year.

D. All monies earned as interest on monies received pursuant to section 41-502 shall be spent only in the percentages and for the purposes described in subsection B of this section or for the costs of administering the fund in such amounts as determined by the Arizona state parks board, in consultation with the historical advisory commission.

E. Monies in the fund may not be used to acquire property.

F. On or before December 31 of each year, the Arizona state parks board, in consultation with the historical advisory commission, shall submit a report to the president of the senate, the speaker of the house of representatives and the chairpersons of the senate committee on natural resources and energy and the house of representatives committee on natural resources, energy and water, or their successor committees. The board shall provide a copy of this report to the secretary of state. The report shall include information on:

The amount of monies spent or encumbered in the fund during the preceding fiscal year and a summary of the projects, activities and expenditures relating to:

(a) Local, regional or state parks for outdoor recreation and open space.

(b) Local, regional and state nonmotorized trails.

(d) Outdoor and environmental education.

The amount of monies spent from the fund during the preceding fiscal year that is itemized.

§ 41-504 Performance audit

The auditor general shall conduct a performance audit, as defined in section 41-1278, of the programs and expenditures of the fund pursuant to this article at the same time an agency performance audit of the Arizona state parks board is conducted. The auditor general shall submit copies of the performance audit to the president of the senate, the speaker of the house of representatives and the chairpersons of the senate committee on natural resources and energy and the house of representatives committee on natural resources, energy and water, or their successor committees.

Article 1.1 Arizona State Parks Board

§ 41-511 Arizona state parks board; membership; appointment; terms

A. There shall be an Arizona state parks board, which shall consist of seven members. The state land commissioner shall be a member and the remaining members, each of whom shall be a bona fide resident of the state, shall be appointed by the governor pursuant to section 38-211. The appointive members shall be selected because of their knowledge of and interest in outdoor activities, multiple use of lands, archaeology, natural resources and the value of the historical aspects of Arizona, and because of their interest in the conservation of natural resources. Not less than one of the appointive members shall be representative of the livestock industry, one appointive member shall be professionally engaged in general recreation work and one appointive member shall be professionally engaged in the tourism industry.

B. All appointments shall be for a term of six years and shall expire on the third Monday in January of the appropriate year.

§ 41-511.01 Compensation and organization of board

A. Appointive members of the board shall serve without compensation.

B. A majority of the membership of the board shall constitute a quorum for the transaction of business. Members of the board shall select one of themselves its chairman for such term as they determine and may appoint from within their membership other officers for such terms as they deem necessary or desirable. The board shall adopt rules for the conduct of its meetings. A record shall be kept of all proceedings and transactions.

§ 41-511.02 Director; qualifications; state historic preservation officer

A. The governor shall appoint a full-time director pursuant to section 38-211 who shall:

Not be a member of the Arizona state parks board.
Serve at the pleasure of the governor.
Be qualified by successful experience in administration in business or in government.
Have a knowledge of or training in the multiple use of lands and the conservation of natural resources.

B. The governor shall designate a full-time employee of the board with professional competence and expertise in the field of historic preservation as the "state historic preservation officer" to administer the state historic preservation program.

§ 41-511.03 Purposes; objectives

The purposes and objectives of the board shall be to select, acquire, preserve, establish and maintain areas of natural features, scenic beauty, historical and scientific interest, and zoos and botanical gardens, for the education, pleasure, recreation, and health of the people, and for such other purposes as may be prescribed by law.

§ 41-511.04 Duties; board; partnership fund; state historic preservation officer; definition

A. The board shall:

Select areas of scenic beauty, natural features and historical properties now owned by the state, except properties in the care and custody of other agencies by virtue of agreement with the state or as established by law, for management, operation and further development as state parks and historical monuments.
Manage, develop and operate state parks, monuments or trails established or acquired pursuant to law, or previously granted to the state for park or recreation purposes, except those falling under the jurisdiction of other state agencies as established by law.
Investigate lands owned by the state to determine in cooperation with the agency that manages the land which tracts should be set aside and dedicated for use as state parks, monuments or trails.
Investigate federally owned lands to determine their desirability for use as state parks, monuments or trails and negotiate with the federal agency having jurisdiction over such lands for the transfer of title to the Arizona state parks board.
Investigate privately owned lands to determine their desirability as state parks, monuments or trails and negotiate with private owners for the transfer of title to the Arizona state parks board.
Enter into agreements with the United States, other states or local governmental units, private societies or persons for the development and protection of state parks, monuments and trails.
Plan, coordinate and administer a state historic preservation program, including the program established pursuant to the national historic preservation act of 1966, as amended.
Advise, assist and cooperate with federal and state agencies, political subdivisions of this state and other persons in identifying and preserving properties of historic or prehistoric significance.
Keep and administer an Arizona register of historic places composed of districts, sites, buildings, structures and objects significant in this state's history, architecture, archaeology, engineering and culture that meet criteria that the board establishes or that are listed on the national register of historic places. Entry on the register requires nomination by the state historic preservation officer and owner notification in accordance with rules that the board adopts.
Accept, on behalf of the state historic preservation officer, applications for classification as historic property received from the county assessor.
Adopt rules with regard to classification of historic property including:

(a) Minimum maintenance standards for the property.

(b) Requirements for documentation.

Monitor the performance of state agencies in the management of historic properties as provided in chapter 4.2 of this title.
Advise the governor on historic preservation matters.
Plan and administer a statewide parks and recreation program, including the programs established pursuant to the land and water conservation fund act of 1965 (P.L. 88-578; 78 Stat. 897).
Prepare, maintain and update a comprehensive plan for the development of the outdoor recreation resources of this state.
Initiate and carry out studies to determine the recreational needs of this state and the counties, cities and towns.
Coordinate recreational plans and developments of federal, state, county, city, town and private agencies.
Receive applications for projects to be funded through the land and water conservation fund and the state lake improvement fund on behalf of the Arizona outdoor recreation coordinating commission.
Provide staff support to the Arizona outdoor recreation coordinating commission.
Maintain a statewide off-highway vehicle recreational plan. The plan shall be updated at least once every five years and shall be used by all participating agencies to guide distribution and expenditure of monies under section 28-1176. The plan shall be open to public input and shall include the priority recommendations for allocating available monies in the off-highway vehicle recreation fund established by section 28-1176.
Collaborate with the state forester in presentations to legislative committees on issues associated with forest management and wildfire prevention and suppression as provided by section 37-1302, subsection B.

B. Notwithstanding section 41-511.21, the board may annually collect and expend monies to plan and administer the land and water conservation fund program, in conjunction with other administrative tasks and recreation plans, as a surcharge to subgrantees in a proportionate amount, not to exceed ten percent, of the cost of each project. The surcharge monies shall be set aside to fund staff support for the land and water conservation fund program.

C. A partnership fund is established consisting of monies received pursuant to subsection B of this section, monies received from intergovernmental agreements pursuant to title 11, chapter 7, article 3 and monies received pursuant to section 35-148. The board shall administer the fund monies as a continuing appropriation for the purposes provided in these sections.

D. The state historic preservation officer shall:

In cooperation with federal and state agencies, political subdivisions of this state and other persons, direct and conduct a comprehensive statewide survey of historic properties and historic private burial sites and historic private cemeteries and maintain inventories of historic properties and historic private burial sites and historic private cemeteries.
Identify and nominate eligible properties to the national register of historic places and the Arizona register of historic places and otherwise administer applications for listing historic properties on the national and state registers.
Administer grants-in-aid for historic preservation projects within this state.
Advise, assist and monitor, as appropriate, federal and state agencies and political subdivisions of this state in carrying out their historic preservation responsibilities and cooperate with federal and state agencies, political subdivisions of this state and other persons to ensure that historic properties and historic private burial sites and historic private cemeteries are taken into consideration at all levels of planning and development.
Develop and make available information concerning professional methods and techniques for the preservation of historic properties and historic private burial sites and historic private cemeteries.
Make recommendations on the certification, classification and eligibility of historic properties and historic private burial sites and historic private cemeteries for property tax and investment tax incentives.

E. The state historic preservation officer may:

Collect and receive information for historic private burial sites and historic private cemeteries from public and private sources and maintain a record of the existence and location of such burial sites and cemeteries located on private or public lands in this state.
Assist and advise the owners of the properties on which the historic private burial sites and historic private cemeteries are located regarding the availability of tax exemptions applicable for such property.
Make the records available to assist in locating the families of persons buried in the historic private burial sites and historic private cemeteries.

F. For the purposes of this section, "historic private burial sites and historic private cemeteries" means places where burials or interments of human remains first occurred more than fifty years ago, that are not available for burials or interments by the public and that are not regulated under title 32, chapter 20, article 6.

§ 41-511.05 Powers; compensation

The board, subject to legislative budgetary control within the limitations of this article, may:

Subject to chapter 4, article 4 and, as applicable, article 5 of this title, employ, determine conditions of employment and specify the duties of such administrative, secretarial and clerical workers and technical employees such as naturalists, archaeologists, landscape architects, rangers, park supervisors, caretakers, guides, skilled tradesmen, laborers, historians and engineers, and contract to have the services of such advisors or consultants as are reasonably necessary or desirable to enable it to perform adequately its duties. The compensation of the director and of all workers and employees shall be as determined pursuant to section 38-611.
Make such contracts, leases and agreements and incur such obligations as are reasonably necessary or desirable within the general scope of its activities and operations to enable it to perform adequately its duties.
Acquire through purchase, lease, agreement, donation, grant, bequest or otherwise real and personal property and acquire real property through eminent domain for state park or monument purposes. Property may not be acquired in the manner provided in this paragraph that will require an expenditure in excess of funds budgeted or received for such purposes. A state park or monument, or additions to a state park or monument, may not be created containing in excess of one hundred sixty acres of land unless created by an act of the legislature. This acreage limitation does not apply in the case of lands given or donated for state park or monument purposes or to state owned lands that are selected by the board and that are not subject to outstanding leases, permits or other rights for the use of the lands including preferential rights to renew such leases and permits.
Sell, lease, exchange or otherwise dispose of real and personal property. Any disposition of real property shall be submitted for approval of the joint committee on capital review. The disposition of office equipment, furnishings, vehicles and other materials is subject to chapter 23, article 8 of this title. The disposition of artifacts and other property of scientific, archaeological, historical or sociological interest is exempt from chapter 23, article 8 of this title, but the board shall consult with the Arizona historical society in disposing of property of historical interest.
Construct at state parks and monuments necessary sanitary and other facilities including picnic tables, fireplaces, campsites, service buildings and maintenance shops, and contract with private persons for the construction and operation of cabins, hotels and restaurants, and like establishments.
Erect suitable signs and markers at parks and monuments and write, prepare and publish written materials describing the historical significance of monuments and other places of historical or other significance.
Solicit and work in cooperation with the department of transportation and the highway departments of various counties and the United States federal highway administration for necessary roads and trails within the state parks and monuments and access roads to state parks and monuments. For the purposes of this paragraph, the board may designate roads, spurs and other traffic related appurtenances within state park boundaries as public highways. Designation of roads, spurs or other traffic related appurtenances as public highways does not prohibit the board from closing such public highways when the park is closed, charging for admission to the park to persons using the public highway within the park or otherwise managing such public highways in the same manner as other lands within the park.
Levy and collect reasonable fees or other charges for the use of such privileges and conveniences as may be provided under the jurisdiction of the board. The board may enter into agreements for the purpose of accepting payment for fees or other charges imposed pursuant to this article by alternative payment methods, including credit cards, charge cards, debit cards and electronic funds transfers. The collecting officer shall deduct any fee charged or withheld by a company providing the alternative payment method under an agreement with the board before the revenues are transferred to the board.
Make reasonable rules for the protection of, and maintain and keep the peace in, state parks and monuments. Such rules adopted by the parks board are subject to review and approval by the legislature. After a board rule has been finally adopted pursuant to chapter 6 of this title, the board shall immediately forward a certified copy of the rule to the legislature. The legislature may review and, by concurrent resolution, approve, disapprove or modify such rule. However, such rule shall be given full force and effect pending legislative review. If a concurrent resolution is not passed by the legislature with respect to the rule within one year following receipt of a certified copy of the rule, the rule is deemed to have been approved by the legislature. If the legislature disapproves a rule or a section of a rule, the board shall immediately discontinue the use of any procedure, action or proceeding authorized or required by the rule or section of the rule. If the legislature modifies a rule or section of a rule, the board shall immediately suspend the use of any procedure, action or proceeding authorized or required by the rule or section of the rule until the modified rule has been adopted in accordance with chapter 6 of this title, after which all proceedings pursuant to the rule shall be conducted in accordance with the modified version of the rule.
Furnish advisory services to city and county park or recreation boards and organizations.
Delegate to the director, the deputy director or the director's designee any of its powers and duties, whether ministerial or discretionary, that are prescribed by law, except that the board may not delegate its power or duty to make rules.
Reimburse board volunteers for travel and lodging expenses and per diem subsistence allowances incurred while on public business for the board. Reimbursement amounts shall not exceed those allowed under title 38, chapter 4, article 2.
In consultation with the conservation acquisition board, develop a grant program and adopt guidelines for allocating and obligating monies in the land conservation fund pursuant to section 41-511.23. The guidelines shall include consideration of both qualification issues relating to applicants for grants and issues relating to the proposed use of the grant money in a manner consistent with existing municipal, county and regional land use plans.
Require volunteers who collect fees or interact with children or vulnerable adults as defined in section 13-3623 within a state park to submit a full set of fingerprints to the board for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

§ 41-511.06 Eminent domain

A. In acquiring property by eminent domain, no water, watering facilities or water right of any person shall be taken separate and apart from the land served by such water, watering facilities or water rights, without fair and adequate compensation to be awarded for such land and water, watering facilities or water rights.

B. In seeking to establish a state park or monument on state or federally owned land, the board shall not request the termination or cancellation of any valid lease, permit, government land entry, mining claim, privilege or other right unless fair and adequate compensation is awarded to the holder of such lease, permit, privilege or other right. If the amount of the compensation cannot be determined by agreement, the board may proceed to cause such lease, permit, privilege, government land entry, mining claim or right to be terminated or cancelled if such can be lawfully done by the state or federal agency having jurisdiction thereof, or the board may proceed to acquire the same by eminent domain. In any event the holder of such lease, permit, privilege, government land entry, mining claim or right shall receive fair and adequate compensation for the cost of and damage to his property interest or loss of his lease, privilege, government land entry, mining claim or permit. In determining the amount of such compensation, consideration shall be given to any preferential rights of renewal and other preferential rights of the owner or holder thereof, the damage to the remaining land, damage by access roads, and damage to the rights and operation which such owner may have and all other relevant factors.

§ 41-511.07 Parks and monuments on state lands

The board may take over state lands and improvements thereon pursuant to article 9, chapter 2, title 37, except that the application to and approval by the governor shall not be required if the legislature has created the park or monument, and in determining the amount of compensation to be received by a lessee or permittee all of the elements of damage set forth in subsection B of section 41-511.06 shall be considered.

§ 41-511.08 Judicial review

Except as provided in section 41-1092.08, subsection H, an appeal from a final decision of the board or from a final decision of the director made pursuant to the powers and duties delegated to the director by the board may be taken pursuant to title 12, chapter 7, article 6.

§ 41-511.09 Park ranger law enforcement officers; training

The board may appoint one or more of its officers or employees as a park ranger law enforcement officer. Any person so appointed shall have the minimum qualifications established for peace officers and police officers pursuant to section 41-1822. When so appointed, the officer or employee shall have the authority and power of a peace officer with the primary duties of enforcement of this article and enforcement of rules adopted pursuant to this article for the protection of the parks and monuments against damage and for the preservation of peace in the parks and monuments.

§ 41-511.10 Rejection of gifts

The board may reject any donation, bequest, or gift or property deemed by it to be unsuitable as a state park or monument.

§ 41-511.11 Disposition of gifts; state parks donations fund

Monies from unconditional gifts, donations, bequests and endowments, which are not specifically designated to the state parks revenue fund, shall be deposited, pursuant to sections 35-146 and 35-147, by the board in a fund to be known as the state parks donations fund, for use by the board in accomplishing its objectives and duties. All expenditures from the state parks donations fund shall be made upon claims duly itemized, verified and approved by the Arizona state parks board.

§ 41-511.12 Annual report

Not later than December 31 each year the board shall deliver to the governor, the director of the department of administration and the legislature an annual report of the finances, goals and accomplishments of the board during the preceding fiscal year.

§ 41-511.13 Violations; classification

A. Any person who knowingly damages, defaces or destroys any public park or monument property which is within the state or any political subdivision thereof is guilty of a class 2 misdemeanor.

B. It is unlawful for a person to violate any provision of this article or rule or regulation prescribed under the provisions of this article.

C. Unless a different or other penalty or punishment is specifically prescribed, the person who violates any provisions of this article or who violates or fails to comply with a lawful order, rule or regulation of the Arizona state parks board is guilty of a class 2 misdemeanor.

D. A park ranger law enforcement officer may utilize the procedure prescribed by section 13-3903 for violations of this article or any order, rule or regulation adopted pursuant to this article.

§ 41-511.14 Transfer of authority

All authority the Arizona development board may have to administer state parks and recreational properties and programs is hereby transferred to the Arizona state parks board.

§ 41-511.15 Arizona trail; fund; definition

A. The Arizona trail is designated as a state scenic trail to memorialize former United States congressman Bob Stump for his significant contributions to the trails and people of this state.

B. The Arizona state parks board shall:

Participate in planning, establishing, developing, maintaining and preserving the trail.
Provide information to any person involved in planning, establishing, developing or maintaining the trail regarding the design, corridors, signs, interpretive markers highlighting special areas and historic uses and any other aspect of the trail to promote uniformity of development, maintenance and preservation.
Encourage counties, cities and towns to adapt their general and comprehensive plans to preserve the trail right-of-way and to acquire property or legal interests in property to ensure the trail's continued existence in a permanent location.
In cooperation with federal and state land management agencies, prepare a trail management plan and a plan for interpretive markers for the trail.
Coordinate the board's trail plan with federal, state and local activities and land uses that may affect the trail and with private nonprofit support organizations to assist in planning, developing, promoting and preserving the trail.
Accept gifts and grants of private and public monies for the purposes of this section. Monies received pursuant to this paragraph shall be deposited in the Arizona trail fund.

C. The trail shall be planned and designed for all nonmotorized recreational uses, including hiking, biking, horseback and pack stock use, cross country skiing, snowshoeing and camping.

D. An agency of this state or of a county, city or town may not refuse to permit construction of the trail on property or rights-of-way owned or managed by the agency if the trail does not conflict with existing or proposed uses of the property. Each such agency shall:

Support the construction of the trail in the agency's long-term plans for its property.
Support the designation of the trail as a part of the national trail system.
Accommodate facilities for the safe trail crossing of highway rights-of-way.
Not infringe on existing land uses, such as cattle grazing or mineral development, that are near to or adjoin the trail. This paragraph does not authorize any person using public lands under a permit or lease to interfere with the use, maintenance or operation of the Arizona trail.

E. The Arizona trail fund is established consisting of legislative appropriations and donations to the fund. The Arizona state parks board shall administer the fund. The monies in the fund are continuously appropriated for the sole purpose of maintaining and preserving the Arizona trail.

F. For the purposes of this section, "Arizona trail" means a state scenic trail that extends approximately eight hundred miles between the southern border and the northern border of this state.

§ 41-511.16 Rock climbing state park; fees, gifts and donations; disposition

A. The Arizona state parks board shall establish a rock climbing state park subject to all of the following conditions:

The conveyance of approximately two thousand acres of bureau of land management land by the United States secretary of the interior, pursuant to the recreational and public purposes act (43 United States Code sections 869 through 869-4), to the Arizona state parks board. The land is located in Gila county and is generally described as: the south 1/2 of section 4, township 4 south, range 15 east; southeast 1/4 of section 5, township 4 south, range 15 east; all of section 8, township 4 south, range 15 east, except north 1/2, of the southwest 1/4 and southeast 1/4, southeast 1/4; north 1/2, and the north 1/2 of the southwest 1/4 of section 9, township 4 south, range 15 east; north 1/2 section 16, township 4 south, range 15 east, except southeast 1/4 of the northeast 1/4; the north 1/2 of section 17, township 4 south, range 15 east.
The conveyance or lease of three parcels of state trust land totaling approximately one hundred sixty acres to the Arizona state parks board. The trust lands are located in Gila county and are generally described as: the southeast 1/4 of the southeast 1/4 of section 8, township 4 south, range 15 east; south 1/2 of the southeast 1/4, section 9, township 4 south, range 15 east; southeast 1/4 of the northeast 1/4, section 16, township 4 south, range 15 east.
The establishment of a park access road as specified by the United States Congress and a public access easement on the access road being transferred to the Arizona state parks board.

B. Notwithstanding the provisions of section 41-511.05, paragraph 3, additions to the rock climbing state park, up to five hundred acres, shall not require additional legislative authorization.

C. The Arizona state parks board shall use its best efforts to prevent trespass onto private lands adjacent to the boundaries of the rock climbing state park and shall provide access to the owners of any private lands within the exterior boundary of the state park.

D. The Arizona state parks board may charge user fees and concession fees and collect monies from other revenue generating activities. The state parks board shall deposit, pursuant to sections 35-146 and 35-147, all monies collected in the state parks revenue fund established by section 41-511.21.

E. The Arizona state parks board may accept gifts and donations toward the acquisition, management and operations of the rock climbing state park. The Arizona state parks board shall deposit, pursuant to sections 35-146 and 35-147, any gifts or donations collected in the state parks donations fund established by section 41-511.11 and account for these monies separately.

F. The Arizona state parks board shall ensure public access to the rock climbing state park.

G. Nothing in the establishment of the rock climbing state park shall be construed to impose any new or additional management requirements, restrictions or regulations under the laws of this state on the permitting, management of or the conduct of activities on any lands outside the state park, or to impose restrictions on these activities in addition to those applicable to the same land within and outside the state park, before its designation as a state park.

H. Mining and mining related activities carried out by users of lands outside the rock climbing state park do not create a cause of action for any injuries sustained by a person within the boundaries of the state park.

§ 41-511.17 Sustainable state parks and roads fund

The sustainable state parks and roads fund is established consisting of monies received pursuant to section 43-622. The Arizona state parks board shall administer the fund. Monies in the fund are continuously appropriated. The Arizona state parks board shall use the monies in the fund to operate, maintain and make capital improvements to buildings, roads, parking lots, highway entrances and any related structure used to operate state parks.

§ 41-511.18 Spur Cross Ranch state park

A. The Arizona state parks board shall establish Spur Cross Ranch state park subject to the following conditions:

A purchase and sale agreement shall be executed between the Arizona state parks board and at least one owner of Spur Cross Ranch as described in subsection D of this section. The purchase and sale agreement shall be for property that is suitable for a state park consistent with the mission of the Arizona state parks board. The purchase and sale agreement shall be based on an appraisal made by an appraiser who is certified by a nationally recognized appraisal organization. The purchase and sale agreement shall be for a price no greater than the appraised value, but can and may be for a price less than the appraised value.
An intergovernmental agreement shall be executed between the Arizona state parks board and a county with a population of more than one million two hundred thousand persons according to the most recent United States decennial census. That county shall provide half of the purchase price of the portion of Spur Cross Ranch as determined in the purchase and sale agreement between the Arizona state parks board and at least one owner of Spur Cross Ranch.
An intergovernmental agreement shall be executed between the Arizona state parks board and a county with a population of more than one million two hundred thousand persons according to the most recent United States decennial census or with cities or towns or with both and that specifies the obligations of the parties to manage and operate Spur Cross Ranch state park.

B. If funding is provided for the acquisition of Spur Cross Ranch other than from sources administered by an agency of this state or a county with a population of more than one million two hundred thousand persons according to the most recent United States decennial census, the obligation of this state and that county is reduced proportionately by the amount of other funding sources. The use of federal monies for any portion of the costs of acquisition of the Spur Cross Ranch shall not affect this state's jurisdiction over the acquisition, operation or maintenance of the Spur Cross Ranch as a state park.

C. The Arizona state parks board may accept gifts and donations toward the acquisition, management and operation of Spur Cross Ranch state park. Any gifts and donations collected shall be deposited in the state parks donations fund established by section 41-511.11 and accounted for separately. The Arizona state parks board shall ensure public access to the Spur Cross Ranch state park.

D. Spur Cross Ranch state park consists of all or part of the following described property:

Lots 3, 4, 5 and 6; the south half of the northwest quarter; the northwest quarter of the southwest quarter; and the southeast quarter of the northeast quarter, all lying in and being a part of section 4, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
All of section 5, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona; except the southeast quarter of the southeast quarter of section 5.
All of section 6, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The southwest quarter of the southwest quarter of section 4, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The southeast quarter of the southeast quarter of section 5, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The northeast quarter of the northeast quarter of section 8, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The northwest quarter of the northwest quarter of section 9, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
Lots 1 and 2; and the southwest quarter of the northeast quarter, all lying in and being a part of section 4, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The north half of the north half of section 7, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The south half of the southeast quarter of section 7, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The south half of the northeast quarter of section 8, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona.
The Catherine lode mining claim, designated by the surveyor general as survey number 4096 embracing a portion of section 4, township 6 north, range 4 east of the Gila and salt river base and meridian, Maricopa county, Arizona, in the cave creek mining district, as conveyed and more particularly described in patent recorded in book 248 of deeds, page 400.
The Columbian lode mining claim, designated by the surveyor general as survey number 2685, embracing a portion of the unsurveyed domain in the cave creek mining district, as conveyed and more particularly described in patent recorded in book 99 of deeds, page 10.
The Mashackety lode mining claim, designated by the surveyor general as survey number 2685, embracing a portion of the unsurveyed domain in the Cave Creek mining district, as conveyed and more particularly described in patent recorded in book 99 of deeds, page 10.
The Mashackety number 1 lode mining claim, designated by the surveyor general as survey number 2685, embracing a portion of the unsurveyed domain in the Cave Creek mining district, as conveyed and more particularly described in patent recorded in book 99 of deeds, page 10.

§ 41-511.19 Catalina state park

A. There is established the Catalina state park which may consist of all or a part of the following described property:

Sections 13, 24, 25, north one-half of Section 35, Section 36, all in Township 10 South, Range 14 East, of the Gila and Salt River Base and Meridian, Pinal County, Arizona, Section 1, south one-half of Section 2 East of Lago Del Oro Parkway, South one-half of Section 11, west one-half of Section 12, Section 14, all of Section 20 lying east of Highway 89, south one-half of Section 21, south one-half and the northeast one-fourth of Section 22, Section 23, Section 26, Section 27, Section 28, all of Section 29 lying east of Highway 89, all of Section 32 lying east of Highway 89, Section 33, Section 34, all in Township 11 South, Range 14 East, of the Gila and Salt River Base and Meridian, Pima County, Arizona, Section 3, Section 4, all of Section 5 lying east of Highway 89, all of Section 7 lying east of Highway 89, all of Section 8 lying east of Highway 89, Section 18, all in Township 12 South, Range 14 East, of the Gila and Salt River Base and Meridian, Pima County, Arizona.

B. The Arizona state parks board or its successor may lease or purchase from anyone any of the lands described in subsection A for Catalina state park purposes, subject to the availability of funds appropriated for such purposes by the legislature.

C. Notwithstanding the provisions of title 37, chapter 2, article 14, relating to the exchange of public lands, the state land commissioner may obtain any of the land described in subsection A by trade of state land of equal value within Pima or Pinal county.

§ 41-511.20 Authorized emergency use of water from Lake Patagonia by city of Nogales

A. Notwithstanding any provision of law to the contrary, whenever an emergency exists, as determined by the mayor of the city of Nogales, Arizona, and concurred in by the director of water resources, that there is not sufficient water for use by such city and that there is no other water available from any other practical source, then the state parks board shall, upon request by such mayor, authorize such city to remove from Lake Patagonia such amount of water as needed to supply the city with sufficient water. The city of Nogales shall provide the means for transferring such water.

B. The director of water resources shall assess a fee to the city of Nogales for the use of such water based upon the value of the water. Such fee shall be paid by the city to the state parks board Lake Patagonia account.

§ 41-511.21 State parks revenue fund; purpose; exemption

A. The state parks revenue fund is established consisting of:

Monies received from the sale of park posters, park postcards, books, souvenirs and sundry items pursuant to section 41-511.05, paragraph 4.
Monies appropriated by the legislature for the purpose of enhancing state parks.
Unconditional gifts and donations specifically designated to the revenue fund, except for unconditional gifts, donations, bequests and endowments deposited in the state parks donations fund pursuant to section 41-511.11.
All monies derived from state park user fees, concession fees and other revenue generating activities.
Surcharges on park reservations.
Sale of park assets.

B. The monies in the fund are subject to legislative appropriation:

For the operation and maintenance of the state park system.
For use by the board to acquire and develop real property and improvements as state parks consistent with the purposes and objectives prescribed in section 41-511.03, subject to review by the joint committee on capital review.

C. Monies in the fund shall not be appropriated in a manner that is inconsistent with restrictions in the lease or deed to the property.

D. The board may collect monies as a surcharge on park reservations and shall determine the surcharge rate as provided in section 41-511.05, paragraph 8 after considering the costs to plan and administer the reservation system.

E. On notice from the board, the state treasurer shall invest and divest the monies in the state parks revenue fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

F. Monies in the state parks revenue fund are exempt from section 35-190, relating to lapsing of appropriations. The purposes for which monies were expended during the preceding fiscal year shall be delineated in the agency's annual report pursuant to section 41-511.12.

§ 41-511.22 Trail systems plan; deposit of monies; definition

A. The board shall prepare a trail systems plan that:

Identifies on a statewide basis the general location and extent of significant trail routes, areas and complementary facilities.
Assesses the physical condition of the systems.
Assesses usage of trails.
Describes specific policies, standards and criteria to be followed in adopting, developing, operating and maintaining trails in the systems.
Recommends to federal, state, regional, local and tribal agencies and to the private sector actions which will enhance the trail systems.

B. The plan shall be revised at least once every five years.

C. Monies from gifts, grants and other donations received by the board for the trail systems plan shall be deposited in a separate account of the state parks donations fund established by section 41-511.11 and may be allocated by the board for special trail project priorities established annually by the board.

D. Monies deposited in the state parks donations fund account shall be used for providing state monies up to an amount equal to the amount of cash, materials and labor from any other source for the planning, acquisition, maintenance or operation of the trails and for administrative expenses of not more than twenty per cent of total account monies.

E. For purposes of this section, "trail systems" means coordinated systems of trails in this state.

§ 41-511.23 Conservation acquisition board; land conservation fund; conservation donation and public conservation accounts; livestock and crop conservation fund

(Caution: 1998 Prop. 105 applies)

A. The conservation acquisition board is established, as an advisory body to the Arizona state parks board, consisting of the following members who are appointed by the governor, at least one of whom shall be experienced in soliciting money from private sources:

One state land lessee.
One member who is qualified by experience in managing large holdings of private land for income production or conservation purposes.
One member of the state bar of Arizona who is experienced in the practice of private real estate law.
One real estate appraiser who is licensed or certified under title 32, chapter 36.
One member who is qualified by experience in marketing real estate.
One representative of a conservation organization.
One representative of a state public educational institution.

B. The governor shall designate a presiding member of the board. The term of office is five years except that initial members shall assign themselves by lot to terms of one, two, three, two members for four and two members for five years in office.

C. The conservation acquisition board shall:

Solicit donations to the conservation donation account.
Consult with entities such as private land trusts, state land lessees, the state land department, the Arizona state parks board and others to identify conservation areas that are reclassified pursuant to section 37-312 and that are suitable for funding.
Recommend to the Arizona state parks board appropriate grants from the land conservation fund.

D. The land conservation fund is established consisting of the following accounts:

The conservation donation account consisting of monies received as donations. Donations to the account are subject to any lawful conditions the donor may prescribe, including any conditions on the use of the money or reversion to the donor. Monies in the account are exempt from the provisions of section 35-190 relating to lapsing of appropriations.
The public conservation account consisting of monies appropriated to the account from the state general fund and monies from any other designated source. In fiscal years 2000-2001 through 2010-2011, the sum of twenty million dollars is appropriated each fiscal year from the state general fund to the public conservation account in the land conservation fund for the purposes of this section. Monies in the account are appropriated for the purposes of this section, and the Arizona state parks board may spend monies in the account without further legislative authorization. Each expenditure of monies from the public conservation account for purposes listed under subsection G, paragraph 2 of this section shall be matched by an equal expenditure of monies from the conservation donation account or from other private or governmental sources.

E. If the legislature fails to appropriate monies to the public conservation account in a fiscal year, and if there are no other monies in the public conservation account, the Arizona state parks board may either grant nothing from the fund in that year or, on recommendation by the conservation acquisition board, may grant available monies in the conservation donation account for purposes authorized in subsection G of this section.

F. The monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

G. Monies in the public conservation account, with matching monies from the conservation donation account, are appropriated as follows:

1. A total of two million dollars each fiscal year to the livestock and crop conservation fund. The fund is established for the purposes of this paragraph. Monies in the fund are continuously appropriated to the Arizona department of agriculture for the exclusive purpose of granting monies to individual landowners and grazing and agricultural lessees of state or federal land who contract with the Arizona department of agriculture to implement conservation based management alternatives using livestock or crop production practices, or reduce livestock or crop production, to provide wildlife habitat or other public benefits that preserve open space and for administrative expenses as provided by this paragraph. The department shall administer the fund. On notice from the director of the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations. For the purposes of granting monies from the fund pursuant to this paragraph, the department:

(a) Shall develop guidelines and criteria for implementation of this program that shall include requiring as part of the application a letter describing the intended use for the grant money.

(b) Shall give priority to lessees of state or federal land who reduce livestock production to provide public benefits such as wildlife species conservation or wildlife habitat.

(c) Shall not grant more than fifty per cent of the monies in the fund with respect to land in one county in any fiscal year.

(d) Is exempt from chapter 6 of this title with respect to adopting rules, except that the department shall provide for public notice and sixty days for public comment on the annual grant guidelines and criteria, including public hearings.

(e) Shall award all grants pursuant to chapter 24, article 1 of this title.

(f) Shall require each grantee to submit to the department, within twelve months after receiving the grant, a written report detailing how grant monies were used to achieve the project described in the letter submitted as part of the application. If the project is longer than one year, a written report shall be submitted to the department on an annual basis until the project is complete.

(g) May use not more than ten per cent of the monies appropriated to the fund in any fiscal year for the purposes of administering the program.

(h) Shall prepare a report of the disposition of monies appropriated to the fund each fiscal year and provide a copy of the report to the governor, to the Arizona state parks board and to any person who requests a copy.

2. The remainder of the monies to the Arizona state parks board for the exclusive purpose of granting monies to the state or any of its political subdivisions, or to a nonprofit organization that is exempt from federal income taxation under section 501(c) of the internal revenue code and that has the purpose of preserving open space, for the following purposes only:

(a) To purchase or lease state trust lands that are classified as suitable for conservation purposes pursuant to title 37, chapter 2, article 4.2. A grant of money under this subdivision to a nonprofit organization is conditioned on the organization providing reasonable public access to any land that is wholly or partly purchased with that money. The organization shall agree with the Arizona state parks board that it will impose a restrictive covenant, running with the title to the land, granting such access and providing for reversion to this state of any interest in the property acquired with money granted under this subdivision on the failure to comply with the terms of the covenant. The Arizona state parks board and the state land commissioner have standing to either enforce the covenant or recover the amount of the grant from the current owner, with interest from the date the grant was awarded to the nonprofit organization.

(b) To purchase the development rights of state trust lands throughout this state under the following conditions:

(i) The development rights shall be sold at public auction as provided in section 37-258.01.

(ii) The lessee of the state trust land at the time the development rights are purchased shall be notified of the purchase in writing.

(iii) The purchase of the development rights shall not result in cancellation or modification of the current lease.

(iv) The purchase of the development rights shall not affect the existing lessee's current economic use of the land and rights pursuant to title 37, chapter 2, article 4.2.

(v) As a condition of the sale of the development rights, the purchaser shall agree in perpetuity not to exercise the development rights and that the land shall remain as open space.

(vi) The state trust land shall retain any other rights and attributes as prescribed by law at the time of the purchase.

H. For the purposes of subsection G, paragraph 2 of this section:

1. The Arizona state parks board shall not grant more than fifty per cent of the monies with respect to land in one county in any fiscal year.

A grant of money is valid for eighteen months and may be extended one time for twelve additional months if a required public auction has not been held.
The Arizona state parks board may adopt rules to establish qualifications of nonprofit organizations for purposes of applying for and receiving money granted.
The owner of property that is wholly or partly acquired with money granted shall not restrict or unreasonably limit access to private lands. Any sale of land with money granted shall include a condition requiring that permanent access to private lands be allowed.

I. The Arizona state parks board shall administer the land conservation fund. On notice from the board, the state treasurer shall invest and divest monies in either account in the fund as provided by section 35-313, and monies earned from investments shall be credited to a separate administration account to pay the board's expenses of administering the land conservation and acquisition program under subsection G, paragraph 2 of this section, which shall not exceed five per cent of the amount deposited in the public conservation account in any fiscal year or five hundred thousand dollars, whichever is less. Investment earnings in excess of five hundred thousand dollars are appropriated to the Arizona state parks board for the purpose of operating state parks.

J. Members of the conservation acquisition board may be reimbursed for travel and lodging expenses and per diem subsistence allowances incurred while on public business for the board. Reimbursement amounts shall not exceed those allowed under title 38, chapter 4, article 2.

§ 41-511.24 Arizona state parks store fund

A. The Arizona state parks store fund is established consisting of monies deposited pursuant to a fee schedule for goods and services determined by the Arizona state parks board. The board shall administer the fund. Monies in the fund are subject to legislative appropriation and shall be used by the board to operate and maintain gift shops.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations. All monies in the fund exceeding $1,750,000 at the end of a fiscal year are transferred to the state parks revenue fund established by section 41-511.21.

§ 41-511.25 Arizona veterans memorial state park

A. The Arizona state parks board shall establish the Arizona veterans memorial state park subject to the following conditions:

The Arizona state parks board purchases the Arizona veterans memorial state park site pursuant to title 37, chapter 2, article 3.
The joint committee on capital review approves the design and construction of the memorial.
The site purchased pursuant to paragraph 1 of this subsection is located in a county with a population of more than four million persons and within two miles of a veteran's national cemetery.

B. The Arizona state parks board may enter into an intergovernmental agreement pursuant to title 11, chapter 7, article 3 with the county in which the park is located for the maintenance and preservation of the Arizona veterans memorial state park.

Article 1.2 Arizona Outdoor Recreation Coordinating Commission

§ 41-518 Arizona outdoor recreation coordinating commission; members; powers and duties

A. The Arizona outdoor recreation coordinating commission is established. The commission shall be composed of seven members consisting of the director of the Arizona game and fish department, the director of the Arizona state parks board and five members appointed by the governor. The ex officio members may not serve as officers of the commission. Of the members appointed by the governor three shall be professional full-time parks and recreation department directors of a county, city, or town and no two shall reside in the same county. Two members appointed by the governor shall be from the general public and each shall have broad experience in outdoor recreation. Of the five appointed members, no more than two shall reside in the same county. Each appointed member shall be appointed for a term of three years. Appointed members shall be reimbursed for expenses incurred while attending meetings called by the commission as prescribed by section 38-624.

B. The commission shall:

Review statewide outdoor recreation and lake improvement plans and provide comments to the Arizona state parks board.
Review budget proposals for the use of land and water conservation fund surcharges and the state lake improvement fund for planning and administration and provide recommendations to the Arizona state parks board.
Establish criteria and policies for the equitable distribution of funding, review applications for eligible projects and determine the amount of funding, if any, for each project to be funded from the land and water conservation fund, the state lake improvement fund and the off-highway vehicle recreation fund.

§ 41-518.01 Authorization for participation in federal land and water conservation fund

The state of Arizona, its agencies, counties, cities and towns are granted authority to participate in the "land and water conservation fund act of 1965" as enacted by Public Law 88-578, eighty-eighth Congress.

Article 1.4 Yarnell Hill Memorial

§ 41-519 Yarnell Hill memorial

A. The Arizona state parks board shall establish the Yarnell Hill memorial state park subject to the following conditions:

The Yarnell Hill memorial site board recommends that the Arizona state parks board purchase the land for the memorial site.
The Arizona state parks board purchases the Yarnell Hill memorial site pursuant to title 37, chapter 2, article 3.
The Yarnell Hill memorial site board approves the design and construction of the memorial.
The Yarnell Hill memorial site board secures the necessary permission for individuals to visit the memorial.

§ 41-519.02 Yarnell Hill memorial fund; exemption

A. The Yarnell Hill memorial fund is established consisting of legislative appropriations and donations to the fund. The Yarnell Hill memorial site board shall administer the fund. On notice from the Yarnell Hill memorial site board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. The monies in the fund are exempt from section 35-190 relating to lapsing of appropriations. The monies in the fund and any additional donations to the fund must be used for:

Purchasing land for the Yarnell Hill memorial.
Purchasing, designing and constructing the Yarnell Hill memorial.
Maintaining and preserving the Yarnell Hill memorial and access road.
Reimbursement of the Yarnell Hill memorial site board members' travel expenses.

B. Beginning on January 1, 2017, the Arizona state parks board shall administer the fund.

Article 2.1 Colorado River Boundary Markers Division

§ 41-525.01 Division of Colorado river boundary markers

For the purpose of administering this article, there shall be a division of the state land department which shall be known as the division of Colorado river boundary markers under the authority and direction of the boundary marker commissioner.

§ 41-525.02 Colorado river boundary marker commissioner

A. The state land commissioner shall be ex officio Colorado river boundary marker commissioner.

B. For the additional duties assigned to him by this article the state land commissioner shall receive additional compensation as determined pursuant to section 38-611.

C. The commissioner may within the limits of appropriations made available therefor, appoint an administrative officer of the division of Colorado river boundary markers, a secretary, and such other assistants as may be required, assign their duties and define their powers. The compensation for such employees shall be as determined pursuant to section 38-611.

D. The commissioner shall:

Adopt a seal which shall be judicially noticed.
Hold public hearings provided for by law.
Keep records of all proceedings and annual records of the division.
Promulgate such orders, rules and regulations, and perform such other acts as are necessary to carry out the provisions of this article.

§ 41-525.03 Duties of commissioner

The Colorado river boundary marker commissioner shall:

Investigate the problems that will be created by the necessity of marking permanently the boundaries between the states of Nevada and California and the state of Arizona at the time the boundaries shall become permanently established under the terms of the Colorado river boundary commission act.
In connection with said investigation, determine the various methods which may be used to mark the permanent boundaries.
Report the results of his investigation to the Colorado river boundary commission and make recommendations on the methods of marking said boundary to be used.
Cooperate with the states of California and Nevada and the properly designated representatives of those states to insure that said method of marking shall be agreeable to all states.
Cooperate with the federal government in any manner necessary to establish said permanent markers.
Within the limits of appropriations made available therefor, and in cooperation with the Colorado river boundary commission, carry out the permanent marking of the established boundary between the states of California and Nevada and the state of Arizona.
Report to the legislature any problems which may arise as a result of establishing a permanently marked boundary between the states of California and Nevada and the state of Arizona.

Article 3 Arizona Office of African-American Affairs

§ 41-531 Arizona office of African-American affairs

A. The Arizona office of African-American affairs is established and consists of the governor, the superintendent of public instruction, the director of the department of health services, the director of the department of transportation, the attorney general, the director of the department of economic security, the director of the office of tourism and the chief executive officer of the Arizona commerce authority, or their representatives, who shall be ex officio members, and nine members who are appointed by the governor, seven of whom are African-American and two of whom are not African-American.

B. The term of office of each appointed member is three years. Each member shall hold office until the member's successor is appointed and qualifies. Appointment to fill a vacancy caused other than by expiration of a term shall be for the unexpired portion of the term.

C. Members of the office shall serve without compensation.

D. The office shall elect a chairperson and a vice chairperson from among its appointed members and adopt rules for the conduct of meetings. A record shall be kept of all proceedings and transactions.

E. Section 41-2955, subsection D does not apply to the office.

F. The office shall meet at least quarterly on the second Thursday of the first month of each quarter and may hold additional meetings on the call of the chairperson. A majority of the appointed members of the office constitute a quorum for the transaction of business, but ex officio members may vote. Members who fail to attend three consecutive meetings are deemed to have resigned.

G. The appointed members of the office shall employ, subject to chapter 4, article 4 of this title, an executive director of the office who shall not be a member of the office. The director is eligible to receive compensation as determined by the office from monies available in the Arizona office of African-American affairs fund established by section 41-533. The office may employ clerical, professional and technical personnel subject to chapter 4, article 4 of this title and monies available in the Arizona office of African-American affairs fund and shall prescribe their duties and determine their compensation.

§ 41-532 Powers and duties; information; report

A. The office shall assist and support state and federal agencies in assisting African-Americans in this state to develop mutual goals, to design projects for achieving goals and to implement their projects. The office shall also:

Advise the governor on policies, procedures, legislation and rules that affect the African-American community and that will enable this state to be responsive to the needs of the African-American community.
Assist local African-American community groups in developing strategies and programs that will expand and enhance the social, cultural and economic status of the African-American community.
Develop, review and recommend to the governor policies in the areas of health and human services, housing, education, employment, business formation and development, public accommodations and contracting and procedures.
Serve as a liaison to federal, state and local agencies to ensure that programs affecting African-Americans are effectively used and that benefits accrue equitably to members of the African-American community.
Work for greater understanding and improved relationships between African-Americans and non-African-Americans by creating an awareness of the legal, social and economic needs of African-Americans in this state.
Where appropriate, conduct periodic conferences throughout this state to inform African-Americans of the opportunities available to them through state and private sources, to encourage them to share their history and culture with other Arizonans, to participate in the social and political processes of their communities and to learn from conference participants about their needs and problems.

B. State and local public officers and employees, on request, shall furnish the office with information that it may require for its purposes except information that is not subject to disclosure pursuant to a provision of law.

C. The office shall make a written annual report giving an account of its proceedings, transactions, findings and recommendations to the governor and the legislature and may submit the recommendations to the legislature in the form of proposed legislation.

D. The office may apply for, accept, receive and spend public and private gifts or grants of money or property on those terms and conditions as imposed by the donor and for implementation of the office's internal operations.

E. The office may accept, receive and spend fees collected at the Arizona African-American town hall to defer expenses for the Arizona African-American town hall.

§ 41-533 Arizona office of African-American affairs fund; exemption

The Arizona office of African-American affairs fund is established. The monies in the Arizona office of African-American affairs fund are continuously appropriated to the Arizona office of African-American affairs. The fund consists of monies received pursuant to section 41-532. The state treasurer shall invest and divest all monies in the Arizona office of African-American affairs fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. The Arizona office of African-American affairs shall administer the fund. The monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-534 African-American legislative day

A. The Arizona office of African-American affairs shall annually facilitate an African-American legislative day on the second Thursday and Friday of February. The office shall invite the legislature, the governor and other elected officials to pay tribute to the history and culture of African-Americans and their contributions to the prosperity and cultural diversity of the United States. The office shall schedule activities and discussions between state and community leaders on issues affecting African-American communities.

B. African-American legislative day is not a legal holiday.

Article 5 Economic Estimates Commission

§ 41-561 Economic estimates commission; members; vacancies; limitation

A. There shall be an economic estimates commission composed of the following three members:

The director of the department of revenue or the director's designee, who shall serve as chairman.
One person, who shall be knowledgeable in the field of economics, appointed by the president of the senate.
One person, who shall be knowledgeable in the field of economics, appointed by the speaker of the house of representatives.

B. The appointive commission members shall be appointed for a term of two years and shall receive compensation determined pursuant to section 38-611.

C. Vacancies in commission membership shall be filled for the balance of the unexpired term in the same manner as the original appointment.

D. No member of the commission shall be a member of the legislature.

§ 41-562 Powers and duties of the commission; definition

A. The economic estimates commission shall determine and report to the legislature prior to January 15 of each year the following:

The estimated total personal income in Arizona for the next fiscal year.
The estimated total personal income in Arizona for the current fiscal year.
The estimated percentage change per capita of estimated total personal income in Arizona for the next fiscal year.
The estimated per capita personal income in Arizona for the current fiscal year.

B. Other state agencies shall assist the economic estimates commission in furnishing available data and information necessary for development of the required estimates. In no event shall the commission authorize an independent study or employ consultants in the performance of its duties.

C. The economic estimates commission shall determine and publish prior to November 15 of each year the maximum dollar amount which is expected to be available for legislative appropriation from state tax revenues pursuant to article IX, section 17 of the constitution for the succeeding fiscal year. The dollar amount available for appropriation from state tax revenues shall be computed by multiplying together the appropriation percentage limitation for the succeeding fiscal year and the estimated total personal income of the state of Arizona for the succeeding fiscal year.

D. For the purposes of this section, "total personal income" means the dollar amount that will be reported as total income received by persons in the state of Arizona by the United States department of commerce or its successor agency.

§ 41-563 Expenditure limitations; determination by the commission; definitions

A. For political subdivisions the commission shall:

Determine the base limit level of political subdivisions for each political subdivision subject to an expenditure limitation pursuant to article IX, section 20, Constitution of Arizona. For the purposes of this subsection and subsection D of this section, the "base limit" of each political subdivision means the amount of actual payments of local revenues by such political subdivision in fiscal year 1979-1980 as used to determine the expenditure limitation pursuant to paragraph 4 of this subsection.
Determine and report to the governing board of each political subdivision subject to an expenditure limitation pursuant to article IX, section 20, Constitution of Arizona, prior to February 1 of each year, the following:

(a) The total of the estimated population of each such political subdivision as of July 1 of the prior year and the estimated population of any areas annexed by such political subdivisions thereafter, based on the population estimates developed by the department of economic security. The population of any areas annexed thereafter must be estimated as of July 1 of the prior year.

(b) The estimated change in the GDP price deflator used to determine the expenditure limitation for the following fiscal year over the GDP price deflator used to determine the expenditure limitation for the current fiscal year.

Determine and report to the governing board of each political subdivision subject to an expenditure limitation pursuant to article IX, section 20, Constitution of Arizona, prior to April 1 of each year, the following:

(a) The total of the population of each such political subdivision as of July 1 of the prior year and the population of any areas annexed by such political subdivisions thereafter. The population of any areas annexed thereafter must be estimated as of July 1 of the prior year.

Determine the expenditure limitation for each political subdivision subject to an expenditure limitation pursuant to article IX, section 20, Constitution of Arizona, as follows:

(a) Determine the population of the political subdivision as of July 1, 1978.

(b) Determine the total population of the political subdivision as required by paragraph 3, subdivision (a) of this subsection.

(c) Divide the population determined in subdivision (b) of this paragraph by the population determined in subdivision (a) of this paragraph.

(d) Determine the estimated or actual GDP price deflator for the 1978 calendar year.

(e) Determine the estimated GDP price deflator for the calendar year immediately preceding the fiscal year for which the expenditure limitation is being determined.

(f) Divide the GDP price deflator determined in subdivision (e) of this paragraph by the GDP price deflator determined in subdivision (d) of this paragraph.

(g) Multiply the amount determined in paragraph 1 of this subsection for the political subdivision by the quotient determined in subdivision (c) of this paragraph and multiply the resulting product by the quotient determined in subdivision (f) of this paragraph.

If any annexation, consolidation or change in the boundaries of a political subdivision occurs after the determination and report required by paragraph 3 of this subsection but before July 1 of the current year, the commission, as promptly as feasible, shall redetermine the total population, calculated in paragraph 4, subdivision (b) of this subsection, of the political subdivisions affected by the annexation, consolidation or change in boundaries. The commission shall determine respective amended expenditure limitations based on the amended population, which shall be promptly reported to the governing board of each of the affected political subdivisions. The political subdivisions affected shall use the revised expenditure limitation if it is received before the annual financial statement and estimate of expenses is prepared as required by section 42-17101.
In the event of the creation of a new city or town, the base limit of the new city or town shall be determined by multiplying the average amount of actual fiscal year 1979-1980 per capita payments of local revenues for all cities and towns within the county in which the new city or town is located by the population of the new city or town.
In the event of the division of a county into two or more new counties, determine the expenditure limitation for each of the new counties or the consolidation of counties, pursuant to article IX, section 20, Constitution of Arizona, using one of the following two methods. The board of supervisors of each new county upon the affirmative vote of two-thirds of the members of the board of supervisors, on or before February 1 following the county's establishment, shall adopt one of the expenditure limitations determined:

(a) Method one:

(i) Determine the existing county which has a population closest to the population of the new county as of July 1 for the fiscal year preceding the fiscal year for which the expenditure limit is being determined.

(ii) Determine the per capita expenditure limit for the existing county determined in item (i) of this subdivision based on the amount determined in paragraph 3, subdivision (c) of this subsection for the first full fiscal year following the establishment of the new county government.

(iii) Multiply the per capita amount determined in item (ii) of this subdivision by the population of the new county as of July 1 in the fiscal year in which the new county government is established. The amount thus determined is the expenditure limit for the new county for the first full fiscal year following its establishment.

(iv) Determine a base limit for the new county which will yield the new expenditure limit determined in item (iii) of this subdivision for the first full fiscal year following the establishment of the new county government.

(b) Method two:

(i) Determine the per capita expenditure limit of the old county or counties for the last full fiscal year prior to the establishment of the new county government based upon the amount determined in paragraph 3, subdivision (c) of this subsection.

(ii) Multiply the per capita amount determined in item (i) of this subdivision by the population of the new county as of July 1 in the fiscal year in which the new county government is established. The amount thus determined is the expenditure limit for the new county for the first full fiscal year following its establishment.

(iii) Determine a base limit for the new county which will yield the new expenditure limit determined in item (ii) of this subdivision for the first full fiscal year following the establishment of the new county government.

If the governing board of a political subdivision authorizes expenditures in excess of the expenditure limitation determined pursuant to paragraph 4 of this subsection as provided in article IX, section 20, subsection (2), paragraph (b), subdivision (i), Constitution of Arizona, the expenditure limitation for such political subdivision for the following fiscal year shall be reduced by the amount of expenditures in excess of the limitation, unless the governing board has held an election as provided in article IX, section 20, subsection (2), paragraph (b), subdivision (ii), Constitution of Arizona, and the excess expenditure has been approved by a majority of the qualified electors voting in such election.
If the citizens of a political subdivision approve an increase or decrease in the expenditure limitation as provided in article IX, section 20, subsection (6), Constitution of Arizona, the base limit of a political subdivision shall be adjusted by the commission such that the expenditure limitation of the political subdivision for the fiscal year following approval reflects the approved increase or decrease.

B. For community college districts the commission shall:

Determine the base limit of each community college district subject to an expenditure limitation pursuant to article IX, section 21, Constitution of Arizona. For the purposes of this subsection and subsection D of this section, the "base limit" of each community college district means the amount of expenditures of local revenues in fiscal year 1979-1980 as used to determine the expenditure limitation pursuant to paragraph 4 of this subsection.
Determine and report to the governing board of each community college district prior to February 1 of each year the following:

(a) The estimated student population, utilizing the procedure prescribed in section 15-1466.01, of each community college district for the following fiscal year.

(b) The estimated change in the GDP price deflator as prescribed in subsection A, paragraph 2, subdivision (b) of this section.

(d) The modified expenditure limitation as prescribed in section 15-1471, if applicable.

Determine and report to the governing board of each community college district prior to April 1 of each year the following:

(a) The student population, utilizing the procedure prescribed in section 15-1466.01, of each community college district for the following fiscal year.

(b) The estimated change in the GDP price deflator as prescribed in subsection A, paragraph 2, subdivision (b) of this section.

(d) The modified expenditure limitation as prescribed in section 15-1471, if applicable.

Determine the expenditure limitation for each community college district, as follows:

(a) Determine the student population of each community college district for fiscal year 1979-1980 using the definition of full-time equivalent student in section 15-1401 in 1979-1980, except that if a redefinition of full-time equivalent student changes the number of semester credit units per semester from fifteen units, the student population for the 1979-1980 base year shall be recalculated using the new number of units.

(b) Determine the estimated student population of each community college district for the fiscal year for which the expenditure limitation is being determined using the definition of full-time equivalent student in section 15-1401.

(c) Divide the student population determined in subdivision (b) of this paragraph by the student population determined in subdivision (a) of this paragraph.

(d) Determine the estimated or actual GDP price deflator for the 1978 calendar year.

(e) Determine the estimated GDP price deflator for the calendar year immediately preceding the fiscal year for which the expenditure limitation is being determined.

(f) Divide the GDP price deflator determined in subdivision (e) of this paragraph by the GDP price deflator determined in subdivision (d) of this paragraph.

(g) Multiply the amount determined in paragraph 1 of this subsection for the community college district by the quotient determined in subdivision (c) of this paragraph and multiply the resulting product by the quotient determined in subdivision (f) of this paragraph.

In the event of an annexation, creation of a new community college district or a consolidation or change in the boundaries of a community college district, the base limit of a community college district shall be adjusted by the commission according to the following guidelines:

(a) In the event of the creation of a new community college district, the base limit of the community college district shall be determined by multiplying the average amount of 1979-1980 per capita expenditures of local revenues for all community college districts within the state by the student population of the new community college district. The expenditure limit of the county in which the new community college district is located shall be reduced by the amount paid to other community college districts for tuition in the fiscal year preceding the fiscal year in which the new community college district is created.

(b) In the case of an annexation, consolidation or change in the boundaries of a community college district, the base limit of a community college district shall be adjusted by the commission to reflect the change by increasing the base limit of the community college district gaining the newly included territory and decreasing the base limit of the community college district losing the territory.

(c) If an existing community college district consolidates with a contiguous county not part of a community college district the commission shall:

(i) Increase the base limit of the existing community college district by an amount equal to the amount of revenue which would have been generated by applying the primary property tax rate of the existing community college district in the immediately prior year to the limited assessed valuation of the contiguous county in the immediately prior year.

(ii) Decrease the base limit of the contiguous county by the amount of reimbursement prescribed by section 15-1469, subsection B, paragraph 1, paid by such county in the 1979-1980 base year, except that no decrease shall be made to the base limit of such county if the reimbursement prescribed by section 15-1469, subsection B, paragraph 1 in the immediately prior year was paid by the state pursuant to section 15-1469.01.

(d) In the case of a decrease in service boundaries of a community college district, the base limit of the community college district shall be reduced by the commission to reflect the amount attributable to the service area in fiscal year 1979-1980 and the base student population of the community college district shall be reduced by the commission to reflect fiscal year 1979-1980 student population attributable to the service area. The adjusted base limit and the adjusted fiscal year 1979-1980 student population shall be used in determining the expenditure limitation for the community college district in the first year in which the service boundaries are diminished and in each subsequent year.

C. For school districts the commission shall:

Determine the base limit of school districts subject to the expenditure limitation prescribed by article IX, section 21, subsection (2), Constitution of Arizona. For the purposes of this subsection and subsection D of this section, "base limit" means the total amount of expenditures of local revenues of all school districts in fiscal year 1979-1980 as used to determine the expenditure limitation pursuant to paragraph 4 of this subsection.
Determine and report to the legislature prior to March 1 of each year the following:

(a) The estimated total student population of all school districts for the current year.

(b) The estimated change in the GDP price deflator as prescribed in subsection A, paragraph 2, subdivision (b) of this section.

Determine and report to the legislature, prior to May 1 of each year, the following:

(a) The total student population of all school districts for the current year.

(b) The estimated change in the GDP price deflator as prescribed in subsection A, paragraph 2, subdivision (b) of this section.

Determine the aggregate expenditure limitation for all school districts as follows:

(a) Determine the aggregate student population of all school districts for the school year 1978-1979.

(b) Determine the total student population of all school districts for the current year.

(c) Divide the aggregate student population determined in subdivision (b) of this paragraph by the aggregate student population in subdivision (a) of this paragraph.

(d) Determine the estimated or actual GDP price deflator for the 1978 calendar year.

(e) Determine the estimated GDP price deflator for the calendar year immediately preceding the fiscal year for which the aggregate expenditure limitation is being determined.

(f) Divide the GDP price deflator determined in subdivision (e) of this paragraph by the GDP price deflator determined in subdivision (d) of this paragraph.

(g) Multiply the amount determined in paragraph 1 of this subsection by the quotient determined in subdivision (c) of this paragraph and multiply the resulting product by the quotient determined in subdivision (f) of this paragraph.

D. In the case of a transfer of all or any part of the cost of providing a governmental function, pursuant to article IX, section 20, subsection (4), Constitution of Arizona, or article IX, section 21, subsection (5), Constitution of Arizona, the base limit of political subdivisions, community college districts or school districts, whichever is applicable, shall be adjusted by the commission to reflect the transfer by increasing the base limit of the political subdivision, community college district or school district to which the cost is transferred and decreasing the base limit of the political subdivision, community college district or school district from which the cost is transferred by the amount of the cost of the transferred governmental function.

E. For the purposes of this section:

"Commission" means the economic estimates commission.
"GDP price deflator" means the average of the four implicit price deflators for the gross domestic product reported by the United States department of commerce for the four quarters of the calendar year.
"Political subdivision" means any county, city, including any charter city, or town.
"Population" shall be defined pursuant to article IX, section 20, subsection (3), paragraph (f), Constitution of Arizona.
"Student population" shall be defined pursuant to article IX, section 21, subsection (4), paragraph (e), Constitution of Arizona.

§ 41-563.01 Notification of vote by governing board

In the event of a vote by the governing board of any political subdivision pursuant to article IX, section 20, Constitution of Arizona, for the purpose of authorizing expenditures in excess of the prescribed limitations or for proposing an alternative spending limitation, the governing board shall:

Prior to the vote hold two public hearings on the proposed action. Notice of such hearings shall be published once a week for at least two consecutive weeks in a newspaper of general circulation in the applicable political subdivision. Immediately following the second public hearing, the governing board shall convene a special meeting and vote on the proposed excess expenditure.
Following the vote, a notice shall be published in a newspaper of general circulation within the political subdivision. The notice shall contain the following:

(a) A record of the vote.

(b) If approved, the amount of the expenditures which exceed the amount allowed pursuant to article IX, section 20, subsection (1), Constitution of Arizona.

(c) If approved a statement of the purpose or purposes for which the excess expenditures will be expended and the source of revenues to be used to finance the excess expenditures.

§ 41-563.02 Elections for expenditures in excess of expenditure limitation

A. For any election called pursuant to article IX, section 20, subsection (2), Constitution of Arizona, the governing board calling such election shall, in addition to any other election requirements prescribed by law, prepare and print a publicity pamphlet concerning the excess expenditure that is subject to a vote of the people. The governing board calling the election shall cause to be distributed not less than ten days nor more than thirty days prior to the election one copy of such publicity pamphlet to each household containing a registered voter within the applicable political subdivision. Except as otherwise noted in this section, the cost of printing, delivering and distributing such publicity pamphlets is a public expense of the applicable political subdivision.

B. The publicity pamphlet required by this section shall contain the following:

The date of the election.
Polling places and the times such polling places are open.
A true copy of the title and text of the measure to be voted upon, in the form in which the measure will appear on the ballot. Such text shall indicate material deleted, if any, by printing such material with a line drawn through the center of the letters of such material, and shall indicate material added or new material by printing the letters of such material in capital letters.
The form in which the measure to be voted upon will appear on the ballot, the official title, the descriptive title prepared by the clerk of the board of supervisors in the case of counties or the city or town clerk in the case of cities and towns, and the number by which the measure will be designated.
The amount of the expenditures which exceed the amount allowed pursuant to article IX, section 20, subsection (1), Constitution of Arizona.
A statement of the purpose or purposes for which the excess expenditures were or will be expended and the source of revenues used or to be used to finance the excess expenditures.
For elections called pursuant to article IX, section 20, subsection (2), paragraph (b), Constitution of Arizona, a statement that if the excess expenditure is not approved by a majority of the qualified electors voting at such election, the governing board shall for the following fiscal year reduce expenditures below the expenditures limitation allowed pursuant to article IX, section 20, subsection (1), Constitution of Arizona, by the excess amount.
For elections called pursuant to article IX, section 20, subsection (2), paragraph (c), Constitution of Arizona, arguments for and against the proposed excess expenditures, not to exceed two hundred words. Arguments for the proposed excess expenditures shall be prepared by the governing board. Arguments against the proposed excess expenditures shall be provided by those in opposition. Arguments for or against the excess expenditures shall be submitted to the governing board of the political subdivision at least thirty days prior to the scheduled election. The person, group or organization filing an argument shall not be required to pay any cost of the paper nor any cost of printing the argument.

C. For any election called pursuant to article IX, section 20, subsection (2), Constitution of Arizona, in addition to any other ballot requirements prescribed by law, the clerk of the board of supervisors in the case of counties or the city or town clerk in the case of cities and towns shall cause to be printed on the official ballot the following:

The official title and number of the measure to be voted upon at the ensuing election.
A statement that the excess expenditure to be voted upon is being referred by the governing board of the applicable political subdivision.
A descriptive title containing a summary of the principal provisions of the measure to be voted upon, not to exceed fifty words, which shall be prepared by the clerk of the board of supervisors in the case of counties or the city or town clerk in the case of cities and towns.

D. Except as otherwise provided in this section, any special election called for the purposes of article IX, section 20, subsection (2), Constitution of Arizona, shall be conducted as nearly as practicable in the manner prescribed for general elections in title 16, except that a special election shall be held on the third Tuesday in May.

E. For the purposes of article IX, section 20, subsection (2), paragraph (b), Constitution of Arizona, if a disaster resulting in excess expenditures occurs within ninety days prior to a regular or special election, such excess expenditures shall not be put to a vote of the people until the next subsequent regular or special election.

F. The governing body shall separately budget for the expenditures approved pursuant to this section and may not expend any amounts of money subject to the expenditure limitation in excess of the expenditure limitation calculated without regard to the approved override amount unless such expenditures are made for the purposes stated in the publicity pamphlet.

§ 41-563.03 Proposals for permanent adjustment of expenditure limitation and alternative expenditure limitations; review by auditor general; form of ballot

A. Except as otherwise provided in this section, any use of the initiative process for the purpose of permanently adjusting the expenditure limitation of any political subdivision pursuant to article IX, section 20, subsection (6), Constitution of Arizona, or for the purpose of proposing an alternative expenditure limitation pursuant to article IX, section 20, subsection (9), Constitution of Arizona, shall as nearly as practicable conform to the requirements of title 19, chapter 1, article 4.

B. In addition to the provisions for publicity pamphlets prescribed in section 19-123, for the purposes of article IX, section 20, subsection (6), Constitution of Arizona, such pamphlets shall also contain the following:

The date of the election.
Polling places and the time such polling places are open.
A summary of the amount of the adjustment to the expenditure limitation determined pursuant to article IX, section 20, Constitution of Arizona, as reviewed by the auditor general.
A summary of the source or sources of estimated revenues that are to be used for financing the adjustment to the expenditure limitation or the source or sources of estimated revenues to be reduced as a result of a downward adjustment of the expenditure limitation, as reviewed by the auditor general.
A statement of the purpose or purposes for which the adjustment to the expenditure limitation is to be made.

C. In addition to the provisions for publicity pamphlets prescribed in section 19-123, for the purpose of article IX, section 20, subsection (9), Constitution of Arizona, such pamphlets shall also contain the following:

The date of the election.
Polling places and the time such polling places are open.
A summary of the estimated total expenditures under any proposed expenditure limitation, including the expenditure limitation proposed by the state pursuant to article IX, section 20, Constitution of Arizona, for a period of four consecutive fiscal years, as reviewed by the auditor general.
A summary of the estimated amount of revenues from all sources from which any proposed expenditure limitation, including the expenditure limitation proposed by the state pursuant to article IX, section 20, Constitution of Arizona, shall be funded, for a period of four consecutive fiscal years, as reviewed by the auditor general.
A statement that if no alternative expenditure limitation is approved by a majority of the qualified electors voting at such election, the expenditure limitation prescribed by article IX, section 20, Constitution of Arizona, shall apply to the political subdivision.

D. For the purposes of subsection B of this section, the person, group or organization filing an initiative petition shall submit to the auditor general prior to printing the publicity pamphlet and at least sixty days prior to the election a detailed analysis of the proposed adjustment to the expenditure limitation, showing the specific area or areas in which expenditures are to be adjusted. The analysis shall contain specific amounts of estimated revenue from each source, and any assumptions used in estimating such revenue. A summary of the analysis shall also be prepared to be included in the publicity pamphlet prescribed in subsection B of this section. The auditor general may request additional information necessary to clarify or correct the submitted materials. The auditor general shall review the submitted materials, correcting any error or deficiency, and resubmit the analysis and summary to the governing board of the applicable political subdivision within fifteen working days. The person, group or organization submitting the analysis and summary shall also be notified by the auditor general within fifteen working days of any revision to the originally submitted analysis and summary. No revision may be made to the analysis or summary after review by the auditor general. The summary shall be printed as resubmitted by the auditor general in the publicity pamphlet as prescribed by subsection B of this section. The governing board shall transmit a copy of the printed publicity pamphlet to the auditor general before the election. The analysis as reviewed by the auditor general shall be held by the clerk of the board of supervisors in the case of counties or the city or town clerk in the case of cities and towns, copies of which may be obtained by any registered voter in the applicable political subdivision. For adjustments to the expenditure limitation proposed by the governing board of the applicable political subdivision, such governing board shall cause to be submitted to the auditor general an analysis as is described in this section.

E. For the purposes of subsection C of this section, the person, group or organization filing an initiative petition shall submit to the auditor general prior to printing the publicity pamphlet and at least sixty days prior to the election a detailed analysis of the alternative expenditure limitation proposed in the petition, showing specific amounts estimated to be expended in specific areas, for a period of four consecutive fiscal years. The analysis shall contain specific amounts of estimated revenue from each source, and any assumptions used in estimating such revenue, for a period of four consecutive fiscal years. A summary of the analysis shall also be prepared to be included in the publicity pamphlet prescribed in subsection C of this section. The auditor general may request additional information necessary to clarify or correct the submitted materials. The auditor general shall review the submitted materials, correcting any error or deficiency, and resubmit the analysis and summary to the governing board of the applicable political subdivision within fifteen working days. The person, group or organization submitting the analysis and summary shall also be notified by the auditor general within fifteen working days of any revision to the originally submitted analysis and summary. No revision may be made to the analysis or summary after review by the auditor general. The summary shall be printed as resubmitted by the auditor general in the publicity pamphlet as prescribed in subsection C of this section. The governing board shall transmit a copy of the printed publicity pamphlet to the auditor general before the election. The analysis as reviewed by the auditor general shall be held by the clerk of the board of supervisors in the case of counties or by the city or town clerk in the case of cities and towns, copies of which may be obtained by any registered voter in the applicable political subdivision. For any alternative expenditure limitations proposed by the governing board of the applicable political subdivision, such governing board shall submit the information required by this section to the auditor general. An analysis and summary of the expenditure limitation prescribed in article IX, section 20, Constitution of Arizona, as it applies to the applicable political subdivision, shall be submitted to the governing board of such political subdivision by the auditor general.

F. After the election the clerk of the board of supervisors or the city or town clerk shall immediately notify the auditor general and the economic estimates commission of the results of the election.

G. For any election called pursuant to article IX, section 20, subsection (6) or (9), Constitution of Arizona, the ballot shall be in the form prescribed by section 19-125, except that if more than one adjustment to the expenditure limitation or more than one alternative expenditure limitation is to be voted upon, the ballot shall be in a form so that the electors may vote on each adjustment to the expenditure limitation or each alternative expenditure limitation separately.

§ 41-563.04 Treatment of non-lapsing appropriations

A. For the purposes of this article and article IX, section 17, Constitution of Arizona, appropriations authorized and available for expenditure in prior fiscal years, to the extent they remain wholly or partially unexpended as of July 1, 1979 and that have been exempted from the provisions of section 35-190 shall be applied against the limitation of the first fiscal year during which expenditures were authorized by such appropriation and in no other fiscal year.

B. For the purposes of this article and article IX, section 17, Constitution of Arizona, appropriated amounts authorized and available for expenditure in the current fiscal year or subsequent fiscal years and that are exempt from the provisions of section 35-190 shall be applied against the limitation only in the first fiscal year such amounts were authorized for expenditure and only to the extent such amounts have not been applied to the appropriations limitation of a prior fiscal year.

§ 41-563.05 Alternative population estimate; border counties

(Art. IX, sec. 20(3)(f)(ii), Constitution of Arizona, applies.)

A. In lieu of the population determined by the department of economic security for purposes of computing a county's expenditure limitation under section 41-563, the economic estimates commission shall use, as an alternative, an attributed population that is computed pursuant to this section for any county that is adjacent to a foreign country and that has a census population of less than two hundred thousand persons according to the most recent United States decennial census.

B. The alternative attributed population is the estimated population determined by the department of economic security for the fiscal year plus one-half of the daily average number of persons who lawfully crossed the international border into and out of the county during the calendar year preceding the start of the fiscal year, according to statistics compiled by the United States customs service.

C. The alternative attributed population has no other official validity than for computing a county's expenditure limitation under this article.

Article 7 Department of Veterans' Services

§ 41-601 Definitions

In this article, unless the context otherwise requires:

"Armed forces of the United States" means the army, the navy, the air force, the space force, the marine corps, the coast guard, the commissioned corps of the United States public health services, the national oceanographic and atmospheric administration, the national guard and any military reserve unit of any branch of the armed forces of the United States.
"Commission" means the Arizona veterans' service advisory commission.
"Department" means the department of veterans' services.
"Director" means the director of the department of veterans' services.
"Veteran" means a citizen of the United States who was enlisted, drafted, inducted or commissioned and who was accepted for and assigned to active duty in the armed forces of the United States.

§ 41-602 Arizona veterans' service advisory commission; terms; qualifications; compensation

A. An Arizona veterans' service advisory commission is established consisting of nine members appointed by the governor. Each member shall serve a term of three years.

B. Members shall be veterans and shall be appointed from a list of names submitted by each veterans' organization in this state holding a charter granted by Congress or recognized by the department as a veterans' organization that is actively involved in supporting veteran affairs programs in this state. Not more than two members shall be appointed from any one veterans' organization. Members shall not serve more than two consecutive three year terms.

C. At the first meeting held after July 1 of each year, the commission shall elect a chairperson and vice-chairperson.

D. The commission shall meet on the call of the chairperson but at least once during each three month period. No actions may be taken without a quorum present.

E. The commission shall provide policy advice to the governor and the director regarding veterans' issues.

F. Members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

§ 41-603 Powers and duties

A. The department may act as guardian of an incapacitated veteran, the incapacitated spouse of a veteran or minor children of a veteran, or as conservator of the estate of a protected veteran or of the veteran's incapacitated or surviving spouse or of the minor children of a veteran. The department may act in all fiduciary matters, including as power of attorney, trustee, custodian or representative payee of a veteran, spouse of a veteran or minor child of a veteran. The department may act as the personal representative of the estate of a deceased veteran, deceased spouse of a veteran or deceased child of a veteran.

B. The department shall:

Assist veterans and their families and dependents in presenting, providing and establishing claims, privileges, rights and benefits they may have under federal, state or local law.
Inform veterans and their families and dependents and military and civilian authorities about federal, state and local laws enacted to benefit veterans and their families and dependents and members of the armed forces.
Collect information relating to services and facilities available to veterans.
Cooperate with all government and private agencies receiving services for or benefits to veterans and their families and dependents.
Conduct administrative reviews and, if possible, correct abuses or prevent exploitation of veterans and their families or dependents and recommend corrective legislation.
Adopt rules deemed necessary to administer this article.
Enter into agreements with veterans' organizations in this state holding a charter granted by the Congress of the United States for the beneficial interest of veterans.
Verify and provide written confirmation to the person of eligibility for special license plates issued pursuant to section 28-2475 by determining that all of the following are true:

(a) The person was a member of the United States armed forces on December 7, 1941.

(b) The person received an honorable discharge from the United States armed forces.

(c) The person was on station on December 7, 1941, during the hours of 7:55 a.m. to 9:45 a.m., Hawaii time at Pearl Harbor, the Island of Oahu or offshore, at a distance not exceeding three miles.

Evaluate, supervise, approve and disapprove programs offered by educational institutions and training establishments pursuant to United States Code titles 10 and 38 and state rules, so that veterans and their dependents may draw the educational allowance provided by federal law while pursuing approved programs.
Establish an application process for the Arizona gold star military medal, shall verify the eligibility of recipients and, if funding is available, may award the Arizona gold star military medal to an eligible individual.

C. The department may:

Acquire property for and construct and operate veterans' home facilities in this state.
Acquire property for and establish and operate cemeteries for veterans in this state.
Establish a training center to provide training to current or potential employees and the veteran community. The department may establish a fee for this training.
Subject to legislative appropriation and as authorized by the burial equity for guards and reserves act (P.L. 117-103; 136 Stat. 1109), provide burial services in state veterans' cemeteries for members of the Arizona national guard and the United States armed forces reserves if the member's service was terminated under honorable conditions.

§ 41-603.01 Veterans' homes; department procurement exemptions

A. The department shall provide long-term care services and skilled nursing care to veterans and their spouses in veterans' homes and shall operate and maintain the veterans' homes as self-sustaining facilities.

B. The department may employ staff to operate the veterans' homes as skilled nursing facilities that provide long-term care services.

C. The department shall set guidelines for determining eligibility for admission to the veterans' homes and the monetary charges to be paid by residents. All guidelines shall conform to the federal requirements that must be met to qualify the veterans' homes as nursing homes for veterans and to render the homes eligible to receive federal financial assistance.

D. In administering the veterans' homes, the department may:

Establish accounts to record the receipt and disbursements from residents to pay for maintenance in the homes.
Set charges.
Develop accounts and procedures pertaining to incompetent residents.
Establish such other accounts as are necessary for the orderly administration of the homes.
Settle any debt owed to the veterans' homes by collecting at least seventy-five percent of the account balance. If the department cannot collect at least seventy-five percent of an account balance, the department shall refer the account to the attorney general's office for collection pursuant to chapter 1, article 5 of this title.
Adopt rules necessary for the operation of the veterans' homes.

E. Notwithstanding chapter 23 of this title the department may:

Award a contract for tangible personal property to be used by the department without the use of competitive sealed bids or competitive sealed proposals at a price equal to or less than the contractor's current federal supply contract price if the contractor indicates in writing that the contractor is willing to extend the current federal supply contract pricing, terms and conditions to the tangible personal property and the purchase order for the items of tangible personal property adequately identifies the federal supply contract on which the contract is based.
Dispose of surplus property at the veterans' homes by sale to private persons, firms and corporations, including hospitals and other nursing home facilities. The department shall deposit, pursuant to sections 35-146 and 35-147, all monies collected from the sale of surplus property at the veterans' homes in the state homes for veterans trust fund established by section 41-608.01.

F. The department is exempt from chapter 23 of this title for the purchase of supplies and items for resale such as food, gift items, souvenirs and other similar items and for contracting for services relating to gift shops and vending machines located in veterans' homes.

§ 41-604 Director of veterans' services; compensation

A. The governor shall appoint the director pursuant to section 38-211. The director shall be a veteran.

B. The director shall inform the commission regarding the policies adopted by the department under this article.

C. The director may appoint a deputy director with the approval of the governor. The deputy director serves at the pleasure of the director. The deputy director is directly responsible for the duties delegated to the deputy director by the director.

D. The director and deputy director are eligible to receive compensation pursuant to section 38-611.

E. The director may appoint advisory committees as the director deems necessary. Members of advisory committees are not entitled to compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

F. The director may contract with a nonprofit organization to work on issues relating to women veterans.

§ 41-605 Service of department as guardian or conservator

The department may institute in a court of competent jurisdiction a proceeding as provided by title 14 for appointment as guardian of an incapacitated veteran, the incapacitated spouse of an incapacitated veteran or the minor child of a veteran or as conservator of the estate of a protected veteran or the veteran's surviving spouse or of the minor children of a veteran or of the estate of an insane or incompetent veteran.

§ 41-606 Action as executor, administrator, guardian or conservator; bond; method of payment

A. The department shall post with the secretary of state a corporate surety bond in an amount of five hundred thousand dollars. The bond shall be conditioned upon the faithful discharge of the department's duties as executor, administrator, conservator or guardian and shall inure to the use and benefit of each person or estate for whom the department is appointed to act. In any case or proceeding in which the department is appointed administrator, executor, guardian or conservator as authorized under this article, the department shall act without additional bond and the court or official having jurisdiction shall so order in its order of appointment.

B. In each case in which the department is appointed to serve as administrator, conservator, executor or guardian as authorized under this article, the court in which the estate is filed shall authorize a charge for each estate's share of the bond premium to be paid from the assets of the estate and to be deposited, pursuant to sections 35-146 and 35-147, in the state general fund. The department shall determine the charge to be made against each estate.

§ 41-607 Violation; classification

A person who knowingly makes a false statement under oath, orally or written, of a material fact relating to any claim under the provisions of this article is guilty of a class 5 felony.

§ 41-608 Veterans' donations fund; transfer; grants

A. The veterans' donations fund is established consisting of monies, gifts and contributions donated to the department and monies deposited pursuant to sections 28-2414, 28-2428, 28-2431, 28-2447, 28-2454, 28-2470.10, 28-2473, 28-2474, 28-2475, 28-2476 and 43-620. The department shall administer the fund. Monies in the fund are continuously appropriated. The monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations. The department shall annually transfer fifteen percent of all revenues received by the department that are deposited in the veterans' donations fund pursuant to this section to the subaccount established pursuant to section 41-608.01 in the state homes for veterans trust fund. The department shall adopt rules or policies for grants of less than $5,000 that encourage as much competition as practicable.

B. The director or the director's designee may solicit and receive donations, including in-kind donations, from the public for veterans. The director shall deposit, pursuant to sections 35-146 and 35-147, the monetary donations in the veterans' donations fund. Monies in the fund are subject to state auditing procedures. Except for monies deposited pursuant to sections 28-2431 and 28-2447, the donations may be used for the benefit of the veterans within this state as grants, subject to chapter 24 of this title, if applicable.

C. The director shall establish a separate subaccount in the veterans' donations fund for the deposit of monies received pursuant to section 28-2431, subsection C. The monies in the subaccount shall be used for the construction and maintenance of the enduring freedom memorial authorized pursuant to section 41-1363 for placement in Wesley Bolin Plaza.

D. The director shall establish a separate subaccount in the veterans' donations fund for the deposit of monies received pursuant to section 28-2447, subsection F. The monies in the subaccount shall be used for the benefit of women veterans in this state, including providing shelter to homeless women veterans as grants, subject to chapter 24 of this title, if applicable.

E. The director shall establish a separate subaccount in the veterans' donations fund for the deposit of monies received pursuant to section 28-2454, subsection C. The first $32,000 in the subaccount shall be reimbursed to the person that provides the $32,000 pursuant to section 28-2454, subsection A. The director shall annually allocate monies from the subaccount to a foundation that is qualified under section 501(c)(3) of the United States internal revenue code for federal income tax purposes and that is the nation's oldest and largest provider of need-based scholarships to children of United States military members. The foundation must:

Have been in existence for at least fifty-two years.
Have provided more than thirty-three thousand scholarships that are valued at almost $90,000,000.
Have a mission that includes honoring marines and educating their children.
Award scholarship monies to children of marines and navy corpsmen who were killed or wounded in combat or who have demonstrated financial need.

F. The director shall establish a separate subaccount in the veterans' donations fund for the deposit of monies received pursuant to section 28-2470.10, subsection C. The first $32,000 in the subaccount shall be reimbursed to the person that provides the $32,000 pursuant to section 28-2470.10, subsection A. The director shall annually allocate monies from the subaccount to a foundation that is qualified under section 501(c)(3) of the United States internal revenue code for federal income tax purposes. The foundation must:

Have been in existence for at least twenty years.
Have a mission that includes providing college scholarships to:

(a) The sons and daughters of those who have served the United States honorably as soldiers in the United States army.

(b) The spouses of enlisted soldiers on active duty in the United States army.

Envision increasing its fundraising and visibility to encourage more applicants to apply for scholarships and to provide larger scholarships to an increasing number of deserving applicants to both:

(a) Reward army families for the sacrifices that army soldiers make every day to serve their nation.

(b) Help the spouses and children of army soldiers become leaders in society.

Award scholarship monies to:

(a) Children of former United States army members who were killed while serving in the United States army or who received an honorable discharge or medical discharge.

(b) Children of United States army members in good standing serving in regular active duty, active duty reserve or active duty national guard.

(c) Spouses of United States army members in good standing serving in regular active duty, active duty reserve or active duty national guard.

G. The director shall inventory and account for the use of any tangible personal property donated to the fund.

H. The department may use up to $150,000 from the veterans' donations fund each fiscal year to administer this section. In addition to any other full-time equivalent positions authorized by law, the department is authorized two full-time equivalent positions to administer this section.

I. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

§ 41-608.01 State homes for veterans trust fund; purpose; subaccount

A. The state homes for veterans trust fund is established. The director shall administer the fund for the sole purpose of operating and maintaining state-operated nursing and domiciliary homes for Arizona veterans.

B. The fund consists of monies deposited by the director from monies generated by operating the Arizona veterans' homes, monies deposited pursuant to section 41-603.01 and monies transferred by the department pursuant to section 41-608.

C. The director shall establish a separate subaccount in the fund for monies deposited pursuant to section 41-608, subsection A. The monies in the subaccount shall be used for any of the following purposes:

To support the various needs of the veterans residing at the nursing and domiciliary homes.
To purchase any necessary equipment for the nursing and domiciliary homes.
For any necessary improvements for the nursing and domiciliary homes.
For any ongoing maintenance required for the nursing and domiciliary homes.

D. Monies in the fund are subject to annual appropriation by the legislature. The fund is exempt from the provisions of section 35-190 relating to lapsing of appropriations. Any monies in the fund remaining unexpended or unencumbered at the end of the fiscal year do not revert to the state general fund.

E. On notice from the director, the state treasurer shall invest and divest monies in the fund and subaccount as provided by section 35-313, and monies earned from investment shall be credited to the fund and subaccount.

§ 41-608.02 State veterans' cemetery fund

A. The state veterans' cemetery fund is established consisting of monies appropriated by the legislature and federal monies the department receives for reimbursement for up to three state veterans' cemeteries. Any additional federal monies received by the department for reimbursement for state veterans' cemeteries revert to the state general fund. The department shall administer the fund.

B. Monies in the fund:

Shall be used to acquire property for and to establish state veterans' cemeteries.
Are continuously appropriated.
Are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-608.03 Arizona state veterans' cemetery trust fund; donations; purpose

A. The Arizona state veterans' cemetery trust fund is established consisting of monies, grants, gifts and contributions donated to the fund from any public or private source. The director shall hold the monies in trust to manage and maintain the southern Arizona veterans' cemetery, the Arizona veterans' memorial cemetery at Camp Navajo and the Arizona veterans' memorial cemetery at Marana.

B. The director shall deposit the donations to the fund, pursuant to sections 35-146 and 35-147, in the fund.

C. Monies in the fund are:

Subject to state auditing procedures.
Continuously appropriated.
Exempt from the provisions of section 35-190 relating to lapsing of appropriations.

D. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313. The state treasurer shall credit to the fund monies earned from the investments.

§ 41-608.04 Military family relief fund; subaccounts; advisory committees; definitions

(Rpld. 1/1/27)

A. The military family relief fund is established through December 31, 2026. The fund consists of private donations, grants, bequests and any other monies received for that purpose.

B. The pre-9/11 veterans subaccount and post-9/11 veterans subaccount of the military family relief fund are established. The department shall administer the fund and subaccounts. On notice from the director, the state treasurer shall invest and divest monies in the subaccounts as provided by section 35-313, and monies earned from investment shall be credited to the subaccounts. The monies in the subaccounts are continuously appropriated to the department solely for the purposes described in this section. Any monies remaining unexpended and unencumbered on December 31, 2026 shall be transferred for deposit in the veterans' donations fund established by section 41-608.

C. The post-9/11 military family relief advisory committee is established to determine appropriate uses of the monies in the post-9/11 veterans subaccount as provided by this section. The post-9/11 military family relief advisory committee consists of the director or the director's designee and twelve additional members, including widows and widowers of military personnel who died in the line of duty, military retirees, veterans who have a service-connected disability and their family members, Arizona army and air national guard unit commanders and active and retired senior enlisted military personnel. Except for the director, the governor shall appoint the members based on recommendations by the director, the adjutant general and commanders of military bases in this state. Appointed members serve at the pleasure of the governor. The post-9/11 military family relief advisory committee shall elect a chairperson from among the appointed members.

D. The post-9/11 military family relief advisory committee shall:

Establish criteria for the use of monies in the post-9/11 veterans subaccount.
Establish and revise as necessary the application process for financial assistance.
Review and evaluate applications.
Make other recommendations as necessary.

E. The pre-9/11 military family relief advisory committee is established to determine appropriate uses of the monies in the pre-9/11 veterans subaccount as provided by this section. The pre-9/11 military family relief advisory committee consists of the director or the director's designee and twelve additional members, including widows and widowers of military personnel who died in the line of duty, military retirees, veterans who have a service-connected disability and their family members, Arizona army and air national guard unit commanders and active and retired senior enlisted military personnel. Except for the director, the governor shall appoint the members based on recommendations by the director, the adjutant general and commanders of military bases in this state. Appointed members serve at the pleasure of the governor. The pre-9/11 military family relief advisory committee shall elect a chairperson from among the appointed members.

F. The pre-9/11 military family relief advisory committee shall:

Establish criteria for the use of monies in the pre-9/11 veterans subaccount.
Establish and revise as necessary the application process for financial assistance.
Review and evaluate applications.
Make other recommendations as necessary.

G. The advisory committees may establish subcommittees, consisting of not more than five members of the full committees, to recommend approval of a grant to an applicant of not more than $3,000.

H. Notwithstanding section 38-431.03, the subcommittees may meet in executive session without advance notice. The full advisory committees may meet in executive session, with notice pursuant to section 38-431.02, to review and evaluate applications or review recommendations of the subcommittees. Applications for financial assistance and all committee considerations and evaluations of the applications are confidential.

I. The monies in the post-9/11 veterans subaccount shall be used to provide financial assistance pursuant to this subsection. The service member of an applying family must have been deceased, wounded or injured or become seriously ill after September 11, 2001 and been deployed from a military base in this state after September 11, 2001, claimed this state as the service member's home of record, been a member of the Arizona national guard at the time of deployment or established residency in this state and be able to provide proof of continuous physical presence in this state for at least twelve months before submitting an application. If discharged from military service, the service member must have been discharged under honorable conditions. The assistance shall be based on financial need as a result of the service member's military service up to $20,000 per family. Eligible assistance is as follows:

Widows, widowers or dependent children of service members who died in the line of duty in a combat zone or a zone where the person was receiving hazardous duty pay may apply for a stipend for living expenses for up to six months. For the purposes of the stipend, qualifying living expenses are residential mortgage, rent and utility payments and other basic living expenses. Payments with respect to any deceased person under this paragraph are limited to a total of $20,000.
An immediate family member may apply for payment of costs of temporary residence near the medical facility where the service member or former service member is being treated, including living, travel and housing expenses. Payments may be payable in monthly installments as long as the person is hospitalized or receiving medical care or rehabilitation services as authorized by military or veterans' medical personnel.
An immediate family member, service member or former service member may apply for:

(a) Living expenses.

(b) Other appropriate expenses as determined by the post-9/11 military family relief advisory committee.

J. The monies in the pre-9/11 veterans subaccount shall be used to provide financial assistance pursuant to this subsection. The service member of an applying family must have been deceased, wounded or injured or become seriously ill on or before September 11, 2001 and been deployed from a military base in this state on or before September 11, 2001, claimed this state as the service member's home of record, been a member of the Arizona national guard at the time of deployment or established residency in this state and be able to provide proof of continuous physical presence in this state for at least twelve months before submitting an application. If discharged from military service, the service member must have been discharged under honorable conditions. The assistance shall be based on financial need as a result of the service member's military service up to $20,000 per family. Eligible assistance is as follows:

Widows, widowers or dependent children of service members who died in the line of duty in a combat zone or a zone where the person was receiving hazardous duty pay may apply for a stipend for living expenses for up to six months. For the purposes of the stipend, qualifying living expenses are residential mortgage, rent and utility payments and other basic living expenses. Payments with respect to any deceased person under this paragraph are limited to a total of $20,000.
An immediate family member may apply for payment of costs of temporary residence near the medical facility where the service member or former service member is being treated, including living, travel and housing expenses. Payments may be payable in monthly installments as long as the person is hospitalized or receiving medical care or rehabilitation services as authorized by military or veterans' medical personnel.
An immediate family member, service member or former service member may apply for:

(a) Living expenses.

(b) Other appropriate expenses as determined by the pre-9/11 military family relief advisory committee.

K. The director may allocate up to ten percent of the donations received for the actual reasonable costs of administering the subaccounts and the financial assistance program under this section, including the hiring of an employee to process applications and provide support to the committee. The department shall provide reasonable office space and other necessary resources for the employee.

L. The director shall receive private donations for deposit in the subaccounts and issue receipts to the donors. A donor shall designate the subaccount in which the donor wishes the donation to be deposited as follows:

One hundred percent of the donation to be deposited in the pre-9/11 veterans subaccount.
One hundred percent of the donation to be deposited in the post-9/11 veterans subaccount.
Fifty percent of the donation to be deposited in the pre-9/11 veterans subaccount and fifty percent of the donation to be deposited in the post-9/11 veterans subaccount.

M. Private donations may qualify for the purposes of income tax credits under section 43-1086. The director may receive donations in any amount, but donations that qualify for tax credits are subject to the limits prescribed by section 43-1086. Donations to the subaccounts that otherwise qualify under the tax credit limits prescribed by section 43-1086 but that exceed a combined total of $1,000,000 in any calendar year, on a first-come, first-served basis, do not qualify for the income tax credits. The director shall provide the taxpayer a donation receipt, which shall include the taxpayer's full name and address, the last four digits of the taxpayer's social security number and the amount of the donation. The director shall designate on the donation receipt whether the donation qualifies under the limits prescribed by this subsection and section 43-1086. The director shall send a record of receipts that qualify under this subsection to the department of revenue.

N. On or before March 31 of each year, the director shall provide for an audit by an independent certified public accountant of the subaccounts and of the aggregate amount authorized by the director for income tax credits under subsection M of this section. The director shall promptly submit a certified copy of the audit to the auditor general. The auditor general may make further audits and examinations as necessary and may take appropriate action relating to the audit or examination pursuant to chapter 7, article 10.1 of this title. If the auditor general does not take further action within thirty days after the audit is filed, the audit is considered to be sufficient. The director shall pay the costs of the certified public accountant and the auditor general from the administration allocation under subsection K of this section.

O. For the purposes of this section:

"Established residency" means that a service member has obtained a valid Arizona driver license, Arizona nonoperating license, Arizona motor vehicle registration or community service organization verification of homeless status and Arizona residency.
"Continuous physical presence" means that a service member has a documented place of habitation and is living in this state or has community service organization verification of homeless status and continuous physical presence in this state.

§ 41-608.05 Arizona gold star military medal

A. The Arizona gold star military medal may be awarded on behalf of the people of this state to an individual who has been killed in action from and after February 13, 1912 while:

Engaged in an action against an enemy of the United States.
Engaged in military operations involving conflict with an opposing foreign force.
Serving with friendly foreign forces engaged in an armed conflict against an opposing armed force in which the United States is not a belligerent party.
Serving in a combat zone as designated by a presidential order.

B. A recipient of the Arizona gold star military medal may have the recipient's name entered on the Arizona gold star military medal honor roll.

C. A member of the Arizona national guard, United States military reserves or regular United States armed forces who was a legal resident of this state at the time the member was killed in action or died in the line of duty while deployed in support of combat operations from and after February 13, 1912 is eligible to receive the Arizona gold star military medal.

D. The department may award the Arizona gold star military medal pursuant to section 41-603 on verification of an individual's eligibility based on the application submitted by the individual's family member. Applications shall be accompanied by a copy of the military issued report of casualty, proof of residency at the time the eligible individual was killed in action and proof of the applicant's relationship to the individual.

E. State general fund monies shall not be used or expended to pay all or any part of the cost to design, manufacture or produce the Arizona gold star military medal.

§ 41-609 Arizona veteran supportive campuses; department list; reports; definition

A. A postsecondary institution may request to be certified by the director as an Arizona veteran supportive campus. The department shall maintain a list of certified Arizona veteran supportive campuses on the department's website. The list shall include:

A link to the website of the campus.
A statement that this list does not contain all postsecondary institutions that may qualify as an Arizona veteran supportive campus.
A disclaimer that the department has not verified the information on the websites of the campuses listed pursuant to paragraph 1 of this subsection and that the department does not endorse any offer made by any sponsor of the website.

B. The department shall make a reasonable effort to notify postsecondary institutions and any other appropriate entities of the opportunity to be certified as an Arizona veteran supportive campus.

C. On or before December 31 and June 30 of each year, each Arizona veteran supportive campus shall forward a report to the department on the number of veterans enrolled in and graduating from its campus.

D. For the purposes of this section, "Arizona veteran supportive campus" means a postsecondary institution that offers:

A campus survey of student veterans to identify the needs, issues and suggestions of veterans.
A campus steering committee consisting of student veterans, faculty and staff to share information and to develop programs to establish or strengthen a veteran supportive campus based on best practices but that also integrates the campus culture and identifies the real needs of the student veterans.
Sensitivity and awareness training on military and veterans' culture, including related issues such as traumatic brain injury, posttraumatic stress disorder, physical and mental disabilities, suicide and hypervigilance for faculty and staff.
Student veteran orientation programs, including student veteran guides for the first day on campus, an optional student veteran orientation session and at least one optional veteran only course taught by a veteran or by a trained volunteer on veteran issues.
Peer mentoring and peer support programs for student veterans.
Outreach strategies to local military bases.
One-stop resource and study centers on campus for student veterans, their families and student family members of the armed forces who are currently deployed.
Community-based collaborations to allow the private sector to support veteran resource centers through financial and in-kind gifts.

§ 41-610 Capital projects; federal monies; annual report

On or before November 1 of each year, the department shall submit a report to the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting on capital projects for which the department has requested federal monies in the last twelve months. For each project, the report shall include:

The status of the request for and receipt of the federal monies.
The estimated construction start date.
The estimated construction end date.
The fund sources and estimated cost for construction.
The fund sources and estimated ongoing operational cost.

§ 41-610.01 Hyperbaric oxygen therapy for military veterans fund; exemption; advisory committee; annual report

A. The hyperbaric oxygen therapy for military veterans fund is established consisting of private donations, grants, bequests and any other monies. The department shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies in the fund shall be used to provide financial assistance to veterans for hyperbaric oxygen therapy.

C. If, after fund monies are spent to pay for hyperbaric oxygen therapy for a veteran, the department discovers that the therapy was fully or partially covered by private insurance or any other entity, the department may seek to have the fund reimbursed for the portion of the payment that was covered by private insurance or the other entity.

D. The hyperbaric oxygen therapy for military veterans advisory committee is established consisting of the following members:

The director or the director's designee.
Four members who are appointed by the governor and who are any of the following:

(a) National guard unit commanders.

(b) Doctors.

E. The director or the director's designee shall serve as chairperson of the hyperbaric oxygen therapy for military veterans advisory committee. Appointed members of the committee shall serve at the pleasure of the governor.

F. The hyperbaric oxygen therapy for military veterans advisory committee shall:

Determine how to award monies from the fund.
Establish and revise as necessary the application process for financial assistance.
Make other recommendations as necessary.

G. The hyperbaric oxygen therapy for military veterans advisory committee shall submit an annual report detailing the fund's performance and the demographics of the award recipients to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state.

§ 41-610.02 Veteran suicide prevention training pilot program; annual report

(Rpld. 1/1/28)

A. The veteran suicide prevention training pilot program is established in the department to offer claims examiners and county and municipal veteran service offices specialized training and certification in preventing veteran suicides.

B. The department shall contract with an organization that has experience in developing and implementing veteran-relevant and evidence-based suicide prevention training to develop the training curriculum. The department shall establish and oversee the process for selecting program participants and certifying program participants who successfully complete veteran suicide prevention training.

C. The program shall train program participants to do the following:

Identify indicators of elevated suicide risk in veterans.
Provide emergency crisis referrals for veterans expressing or exhibiting symptoms of emotional or psychological distress.

D. The department shall adopt rules necessary to implement this section.

E. On or before July 30 each year, the department shall submit a report to the president of the senate and the speaker of the house of representatives that includes information concerning the pilot program and whether any changes should be made to the pilot program to increase the program's effectiveness. In the department's final report, the department shall recommend whether the pilot program should be continued.

Article 7.1 Veterans' Education

§ 41-611 Veterans' deferment of tuition payment, required books and materials; period; promissory note

A. On registration at a state supported community college, college or university, any person who is eligible for and has applied for benefits for education available to veterans of the United States armed forces under federal law may apply for a deferment of payment of tuition, fees and required books and materials for a period not to exceed one hundred twenty days. The community college, college or university shall defer payment for that period on receipt of a signed and acknowledged promissory note for the amount of the tuition, fees and required books and materials, with no interest charge, that is due and payable at the end of the deferral period. This deferment is available during any registration in which a veteran is awaiting education benefits available to veterans of the United States armed forces under federal law.

B. If at the end of the deferral period the person has not yet received from the veterans administration the initial benefit monies for tuition and fees, the person may be granted an extension until such time as the benefits are received.

C. In situations where deferred payments are granted, the community college, college or university shall not release the person's grades or transfer credits until such time as the debt is satisfied.

§ 41-612 Post-9/11 veteran education relief fund; advisory committee; definitions

A. The post-9/11 veteran education relief fund is established consisting of private donations, grants, bequests and any other monies. The department shall administer the fund. Monies in the fund are continuously appropriated to the department solely for the purposes prescribed in this section. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

B. The post-9/11 veteran education relief advisory committee is established consisting of the following members:

The director or the director's designee.
One member who is recommended by the Arizona board of regents.
One member who holds a certificate from the state board of education and who has teaching experience that includes high school education or one public member who has teaching experience at a postsecondary institution.
One member who is an active duty or reserve member of the uniformed services of the United States or national guard or who has retired from active duty or reserve or national guard status and who has served as a command career counselor or in a regular assignment that included oversight of training or education programs.
Two public members who have professional experience in human resource management.
One member from an education profession who is employed by a public or private school entity.
Two members who are military members or family members of military members.

C. Except for the director, the governor shall appoint the members based on recommendations by the director, the adjutant general, the Arizona board of regents and commanders of military bases or reserve centers in this state. Appointed members shall serve for a term of two years that may be extended or renewed by the governor at the recommendation of the director. The advisory committee shall elect a chairperson from among the appointed members.

D. The advisory committee shall:

Establish criteria for the use of monies in the fund.
Establish and revise as necessary the application process for financial assistance.
Review and evaluate applications.
Make other recommendations as necessary.

E. The advisory committee may meet in executive session, with notice pursuant to section 38-431.02, to review and evaluate applications. Applications for financial assistance and all committee considerations and evaluations of the applications are confidential.

F. The monies in the fund shall be used to provide financial assistance pursuant to this subsection. A qualifying military veteran may apply for financial assistance for the cost of tuition at a university that is under the jurisdiction of the Arizona board of regents and that is an Arizona veteran supportive campus as defined in section 41-609. The assistance shall be based on financial need up to the amount of tuition that the qualifying military veteran was charged in the last year that the veteran received benefits under the post-9/11 veterans educational assistance act of 2008 (P.L. 110-252; 122 Stat. 2357; 38 United States Code sections 3301 through 3325). The advisory committee shall make tuition assistance payments directly to the university.

G. The advisory committee shall adopt rules to carry out the purposes of this section that include both the following:

A mechanism to publicize the availability of financial assistance to potential qualifying military veterans.
A procedure to ensure that financial assistance awards made before a military veteran withdraws from a university due to military activation remain available on reentry to a university.

H. For the purposes of this section:

"Department" means the department of veterans' services.
"Director" means the director of the department of veterans' services.
"Military member" includes an active duty, reserve or retired member of the uniformed services of the United States or national guard, a veteran who is a member of a veterans' organization or a veteran who has a service-connected disability.
"Qualifying military veteran" means a person who meets all of the following requirements:

(a) Is eligible for in-state tuition status pursuant to section 15-1802, subsection G.

(b) Is attending a university that is under the jurisdiction of the Arizona board of regents and that is an Arizona veteran supportive campus as defined in section 41-609.

(d) Has qualified for benefits under the post-9/11 veterans educational assistance act of 2008 (P.L. 110-252; 122 Stat. 2357; 38 United States Code sections 3301 through 3325).

(e) Has not transferred any portion of the person's benefits under the program to a dependent.

(f) Is within one year of completion of the person's first baccalaureate degree as a full-time student or within two years of completion of the person's first baccalaureate degree as a part-time student.

Article 9 Drug and Gang Policy Council

§ 41-617.01 Arizona drug and gang prevention resource center; report

Annually by November 15, the Arizona drug and gang prevention resource center shall submit a report to the governor, the president of the senate and the speaker of the house of representatives. At a minimum, this report shall include information regarding the current and future activities of the Arizona drug and gang prevention resource center, the source and use of monies received by the center to fund its activities and recommendations for administrative or legislative action.

Article 12 Board of Fingerprinting

§ 41-619.51 Definitions

In this article, unless the context otherwise requires:

"Agency" means the supreme court, the department of economic security, the department of child safety, the department of education, the department of health services, the department of juvenile corrections, the department of emergency and military affairs, the department of public safety, the department of transportation, the state real estate department, the department of insurance and financial institutions, the Arizona game and fish department, the Arizona department of agriculture, the board of examiners of nursing care institution administrators and assisted living facility managers, the state board of dental examiners, the Arizona state board of pharmacy, the board of physical therapy, the state board of psychologist examiners, the board of athletic training, the board of occupational therapy examiners, the state board of podiatry examiners, the acupuncture board of examiners, the state board of technical registration, the board of massage therapy, the board of behavioral health examiners or the Arizona department of housing.
"Board" means the board of fingerprinting.
"Central registry exception" means notification to the department of economic security, the department of child safety or the department of health services, as appropriate, pursuant to section 41-619.57 that the person is not disqualified because of a central registry check conducted pursuant to section 8-804.
"Expedited review" means an examination, in accordance with board rule, of the documents an applicant submits by the board or its hearing officer without the applicant being present.
"Good cause exception" means the issuance of a fingerprint clearance card to an employee pursuant to section 41-619.55.
"Person" means a person who is required to be fingerprinted pursuant to this article or who is subject to a central registry check and any of the following:

(a) Section 3-314.

(b) Section 8-105.

(d) Section 8-463.

(e) Section 8-509.

(f) Section 8-802.

(g) Section 8-804.

(h) Section 15-183.

(i) Section 15-503.

(j) Section 15-512.

(k) Section 15-534.

(l) Section 15-763.01.

(m) Section 15-782.02.

(n) Section 15-1330.

(o) Section 15-1881.

(p) Section 17-215.

(q) Section 28-3228.

(r) Section 28-3413.

(s) Section 32-122.02.

(t) Section 32-122.05.

(u) Section 32-122.06.

(v) Section 32-823.

(w) Section 32-1232.

(x) Section 32-1276.01.

(y) Section 32-1284.

(z) Section 32-1297.01.

(aa) Section 32-1904.

(bb) Section 32-1941.

(cc) Section 32-1982.

(dd) Section 32-2022.

(ee) Section 32-2063.

(ff) Section 32-2108.01.

(gg) Section 32-2123.

(hh) Section 32-2371.

(ii) Section 32-3271.

(jj) Section 32-3430.

(kk) Section 32-3620.

(ll) Section 32-3668.

(mm) Section 32-3669.

(nn) Section 32-3922.

(oo) Section 32-3924.

(pp) Section 32-4128.

(qq) Section 32-4222.

(rr) Section 36-113.

(ss) Section 36-207.

(tt) Section 36-411.

(uu) Section 36-425.03.

(vv) Section 36-446.04.

(ww) Section 36-594.01.

(xx) Section 36-594.02.

(yy) Section 36-766.01.

(zz) Section 36-882.

(aaa) Section 36-883.02.

(bbb) Section 36-897.01.

(ccc) Section 36-897.03.

(ddd) Section 36-1940.

(eee) Section 36-1940.01.

(fff) Section 36-2069.

(ggg) Section 36-3008.

(hhh) Section 41-619.53.

(iii) Section 41-1964.

(jjj) Section 41-1967.01.

(kkk) Section 41-1968.

(lll) Section 41-1969.

(mmm) Section 41-2814.

(nnn) Section 41-4025.

(ooo) Section 46-141, subsection A or B.

(ppp) Section 46-321.

§ 41-619.52 Board of fingerprinting; organization; meetings

A. The board of fingerprinting is established consisting of the following members:

A representative of the supreme court who is appointed by the chief justice of the supreme court.
A representative of the department of economic security who is appointed by the director of the department of economic security.
A representative of the department of education who is appointed by the superintendent of public instruction.
A representative of the department of health services who is appointed by the director of the department of health services.
A representative of the department of juvenile corrections who is appointed by the director of the department of juvenile corrections.
A representative of the department of child safety who is appointed by the director of the department of child safety.

B. At its initial meeting and annually thereafter, the board shall elect a chairperson and vice-chairperson from among its members and any other officers that are deemed necessary or advisable.

C. The board shall meet at least once each calendar quarter and additionally as the chairperson deems necessary. A majority of the members constitutes a quorum for the transaction of business.

D. Board members:

Serve at the pleasure of the appointing authority.
Are not eligible for compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.
Shall have a valid fingerprint clearance card issued pursuant to section 41-1758.07.

E. The chief justice, the superintendent of public instruction or a department director may designate an alternate member to represent a member who is appointed pursuant to subsection A by the chief justice, the superintendent of public instruction or a department director, respectively.

§ 41-619.53 Board of fingerprinting; powers and duties; personnel; liability

A. The board of fingerprinting shall:

Determine good cause exceptions pursuant to section 41-619.55 and central registry exceptions pursuant to section 41-619.57. The board may appoint a hearing officer to recommend that an applicant be granted or denied a good cause exception or central registry exception after the hearing officer conducts an expedited review, a good cause exception hearing or a central registry exception hearing.
Adopt rules to implement this article, including rules to establish good cause exceptions for the issuance of fingerprint clearance cards pursuant to sections 41-1758.03 and 41-1758.07 and central registry exceptions pursuant to section 8-804. This rule making is exempt from the requirements of chapter 6 of this title.
Administer and enforce this article and rules adopted pursuant to this article.
Furnish a copy of its rules, on request, to all applicants who petition the board for a good cause exception pursuant to sections 41-1758.03 and 41-1758.07 or a central registry exception pursuant to section 8-804 and, on request, to licensees, contract providers and state agencies.
Establish fees.

B. In order to grant a good cause exception or a central registry exception, a majority plus an additional member, of the members present, must vote to approve the application. If the board grants a good cause exception, the board shall request in writing that the department of public safety issue a card to the applicant. If the board grants a central registry exception, the board shall notify the department of child safety, the department of economic security or the department of health services, as appropriate, in writing.

C. Subject to chapter 4, article 4 of this title, the board may employ clerical, professional and technical personnel subject to fee monies that are collected and to the budget that is approved by the board members and shall prescribe personnel duties and determine personnel compensation. Personnel employed by the board must have a valid fingerprint clearance card issued pursuant to section 41-1758.07. If the applicant is denied a fingerprint clearance card, in order to be employed by the board, the board must grant a good cause exception pursuant to this article by a unanimous vote.

D. In making any recommendation to the board to grant or deny a good cause exception or central registry exception, the hearing officer shall consider all of the reasons and criteria prescribed in section 41-619.55, subsection E or section 41-619.57, subsection E.

E. Members and employees of the board are not liable for acts done or actions taken by any board member or employee if the members or employees act in good faith following the requirements of this article.

§ 41-619.54 Confidentiality of criminal record and central registry information; exception; reporting; violation; classification

A. All criminal history record information and central registry information that is maintained by the board is confidential, except that criminal history record information and central registry information may be disclosed pursuant to a determination for a good cause exception pursuant to section 41-619.55 or pursuant to a central registry exception pursuant to section 41-619.57.

B. Persons who are present at a good cause exception hearing or a central registry exception hearing shall not discuss or share any criminal history record information or central registry information outside of the good cause exception hearing.

C. Except as provided in subsection D of this section, criminal history record information, central registry information, good cause exception determinations and hearings and central registry exception determinations and hearings are exempt from title 39, chapter 1.

D. On or before December 1 of each year the board shall report the number of applications for a good cause exception and for a central registry exception and the number of good cause exceptions and central registry exceptions that were granted for the twelve month period ending September 30. The report shall itemize the number of applications and the number of applications granted for each of the sections listed in section 41-619.51, paragraph 6. For each of these sections, the report shall further itemize each offense listed in section 41-1758.03, subsections B and C and section 41-1758.07, subsections B and C for which a good cause exception was applied for and for which a good cause exception was granted. The board shall provide a copy of the report to the governor, the speaker of the house of representatives and the president of the senate.

E. A person who knowingly discloses confidential DCS information or central registry information is guilty of a class 5 felony. For the purposes of this subsection, "DCS information" has the same meaning prescribed in section 8-801.

§ 41-619.55 Good cause exceptions; expedited review; hearing; revocation

A. The board shall determine good cause exceptions. The board shall determine a good cause exception after an expedited review or after a good cause exception hearing. The board shall conduct an expedited review within twenty days after receiving an application for a good cause exception.

B. Within forty-five days after conducting an expedited review, the board shall hold a good cause exception hearing if the board determines that the applicant does not qualify for a good cause exception under an expedited review but is qualified to apply for a good cause exception and the applicant submits an application for a good cause exception within the time limits prescribed by rule.

C. When determining whether a person is eligible to receive a good cause exception under an expedited review, the board shall consider whether the person has shown to the board's satisfaction that the person is not awaiting trial on or has not been convicted of committing any of the offenses listed in section 41-1758.03, subsection B or section 41-1758.07, subsection B or that the person is successfully rehabilitated and is not a recidivist. Before granting a good cause exception under an expedited review, the board shall consider all of the criteria listed in subsection E of this section.

D. The following persons shall be present during good cause exception hearings:

The board or its hearing officer.
The person who requested the good cause exception hearing. The person may be accompanied by a representative at the hearing.

E. The board may grant a good cause exception at a hearing if the person shows to the board's satisfaction that the person is not awaiting trial on or has not been convicted of committing any of the offenses listed in section 41-1758.03, subsection B or section 41-1758.07, subsection B or that the person is successfully rehabilitated and is not a recidivist. Notwithstanding any other law, the board may require applicants to disclose evidence regarding substantiated allegations of child or vulnerable adult abuse or neglect for consideration in determining an applicant's successful rehabilitation. If the applicant fails to appear at the hearing without good cause, the board may deny a good cause exception. The board shall grant or deny a good cause exception within eighty days after the good cause exception hearing. Before granting a good cause exception at a hearing, the board shall consider all of the following in accordance with board rule:

The extent of the person's criminal record.
The length of time that has elapsed since the offense was committed.
The nature of the offense.
Any applicable mitigating circumstances.
The degree to which the person participated in the offense.
The extent of the person's rehabilitation, including:

(a) Completion of probation, parole or community supervision.

(b) Whether the person paid restitution or other compensation for the offense.

(c) Evidence of positive action to change criminal behavior, such as completion of a drug treatment program or counseling.

(d) Personal references attesting to the person's rehabilitation.

F. If the board grants a good cause exception to a person, the board shall request in writing that the department of public safety issue a fingerprint clearance card to the person.

G. When determining if a person is eligible to receive a good cause exception, the board's staff, under the direction of the executive director of the board and only in conjunction with the person's application for a good cause exception, shall review reports it receives of the arrest, charging or conviction of the person for offenses listed in sections 41-1758.03 and 41-1758.07 who previously received or who was denied a fingerprint clearance card.

H. The board may request in writing that the department of public safety revoke a person's fingerprint clearance card pursuant to section 41-1758.04 if the person received a fingerprint clearance card and the person is subsequently convicted of an offense listed in section 41-1758.03, subsection B or C or section 41-1758.07, subsection B or C.

I. Pending the outcome of a good cause exception determination, the board or its hearing officer may issue interim approval in accordance with board rule to continue working to a good cause exception applicant.

J. The board is exempt from chapter 6, article 10 of this title.

K. A person who is required to obtain a fingerprint clearance card pursuant to section 41-619.52 is not eligible to receive a good cause exception pursuant to this section.

§ 41-619.56 Board of fingerprinting fund

A. The board of fingerprinting fund is established consisting of monies appropriated by the legislature and fees established by the board pursuant to section 41-619.53. The board shall administer the fund subject to legislative appropriation. Monies in the fund are continuously appropriated for the purposes provided in this article.

B. Monies deposited in the fingerprinting fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-619.57 Central registry exceptions; expedited review; hearing

A. The board shall determine central registry exceptions pursuant to section 8-804. The board shall determine a central registry exception after an expedited review or after a central registry exception hearing. The board shall conduct an expedited review within twenty days after receiving an application for a central registry exception.

B. Within forty-five days after conducting an expedited review, the board shall hold a central registry exception hearing if the board determines that the applicant does not qualify for a central registry exception under an expedited review but is qualified to apply for a central registry exception and the applicant submits an application for a central registry exception within the time limits prescribed by rule.

C. When determining whether a person is eligible to receive a central registry exception pursuant to section 8-804, the board shall consider whether the person has shown to the board's satisfaction that the person is successfully rehabilitated and is not a recidivist. Before granting a central registry exception under expedited review, the board shall consider all of the criteria listed in subsection E of this section.

D. The following persons shall be present during central registry exception hearings:

The board or its hearing officer.
The person who requested the central registry exception hearing. The person may be accompanied by a representative at the hearing.

E. The board may grant a central registry exception at a hearing if the person shows to the board's satisfaction that the person is successfully rehabilitated and is not a recidivist. The board may consider the person's criminal record in determining if a person has been successfully rehabilitated. If the applicant fails to appear at the hearing without good cause, the board may deny a central registry exception. The board shall grant or deny a central registry exception within eighty days after the central registry exception hearing. Before granting a central registry exception at a hearing the board shall consider all of the following in accordance with board rule:

The extent of the person's central registry records.
The length of time that has elapsed since the abuse or neglect occurred.
The nature of the abuse or neglect.
Any applicable mitigating circumstances.
The degree to which the person participated in the abuse or neglect.
The extent of the person's rehabilitation, including:

(a) Evidence of positive action to change the person's behavior, such as completion of counseling or a drug treatment, domestic violence or parenting program.

(b) Personal references attesting to the person's rehabilitation.

F. If the board grants a central registry exception to a person, the board shall notify the department of child safety, the department of economic security or the department of health services, as appropriate, in writing.

G. A person who is granted a central registry exception is not entitled to have the person's report and investigation outcome purged from the central registry except as required pursuant to section 8-804, subsections G and H.

H. Pending the outcome of a central registry exception determination, a central registry exception applicant may not provide direct services to children pursuant to title 36, chapter 7.1.

I. The board shall have access to all DCS information and central registry information pursuant to sections 8-804, 8-804.03 and 8-807 for the purposes of determining a central registry exception.

J. The board is exempt from chapter 6, article 10 of this title.

Chapter 3.1 Risk Management

Article 1 Insurance; Uninsured Losses

§ 41-621 Purchase of insurance; coverage; limitations; exclusions; definitions

A. The department of administration shall obtain insurance against loss, to the extent it is determined necessary and in the best interests of this state as provided in subsection G of this section, on the following:

All state-owned buildings, including those of the universities, excluding buildings of community colleges, whether financed in whole or in part by state monies or buildings in which the state has an insurable interest as determined by the department of administration.
Contents in any buildings owned, leased or rented, in whole or in part, by or to this state, excluding buildings of community colleges, and reported to the department of administration.
This state and its departments, agencies, boards and commissions and all officers and employees thereof and such others as may be necessary to accomplish the functions or business of the state and its departments, agencies, boards and commissions against liability for acts or omissions of any nature while acting in authorized governmental or proprietary capacities and in the course and scope of employment or authorization except as prescribed by this chapter.
All personal property reported to the department of administration, including vehicles and aircraft owned by the state and its departments, agencies, boards and commissions and all nonowned personal property that is under the clear responsibility of this state because of written leases or other written agreements.
This state and its departments, agencies, boards and commissions against casualty, use and occupancy and liability losses of every nature except as prescribed by this chapter.
Workers' compensation and employers' liability insurance.
Design and construction of buildings, roads, environmental remediations and other construction projects.
Other exposures to loss where insurance may be required to protect this state and its departments, agencies, boards and commissions and all officers and employees acting in the course and scope of employment or authorization except as prescribed by this chapter.
Actual or suspected data breaches, security system breaches or security incidents for select agencies, boards and commissions.

B. To the extent it is determined necessary and in the best interests of this state, the department of administration shall obtain insurance or provide for state self-insurance against property damage caused by clients and liability coverage resulting from the direct or incidental care of clients participating in programs of this state and its departments, agencies, boards or commissions relating to custodial care. The insurable programs shall include foster care, programs for persons with developmental disabilities, an independent living program pursuant to section 8-521, a transitional independent living program pursuant to section 8-521.01, an extended foster care program pursuant to section 8-521.02 and respite-sitter service programs. The department shall obtain insurance or provide for state self-insurance pursuant to this subsection to protect the clients participating in these programs and individual providers of these program services on behalf of this state and its departments, agencies, boards or commissions. The state self-insurance claims or other insurance that is provided or obtained pursuant to this subsection may not be more than $1,000,000 per claim, including related claims, and $2,000,000 in the aggregate per year. The limits may be adjusted pursuant to rules adopted by the department of administration. Insurance and state self-insurance as prescribed in this section do not apply to providers who are contractually required to indemnify this state or a state department or agency for some or all of the liability of this state or a department or agency of this state. The insurance provided under this subsection does not include medical or workers' compensation coverage for providers. The department may include in its annual budget request pursuant to section 41-622, subsection D a charge for the insurance or self-insurance provided in this subsection. To assist in carrying out this subsection, the department shall establish a seven-member advisory board in accordance with the following provisions:

The board shall consist of three members appointed by the director of the department of administration, at least one of whom shall be a foster parent, one member appointed by the director of the department of economic security, one member appointed by the director of the department of child safety, one member appointed by the director of the state department of corrections, and one member appointed by the administrative director of the courts.
The board shall elect a chairman from among its members.
The board shall hold at least two meetings a year or shall meet at the call of the chairman.
Board members shall serve for three-year terms.
Board members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.
The board shall provide advice to the department regarding coverage and administration of this subsection and shall assist the department in coordinating its activities pursuant to this subsection with state departments, agencies, boards and commissions.

C. To the extent it is determined necessary and in the best interests of this state, the department of administration may obtain insurance or provide for state self-insurance against losses for any agents of this state or its departments, agencies, boards or commissions that are not insured pursuant to subsection A of this section. The coverage shall be limited to liability for acts or omissions while acting in the course and scope of employment or authorization by this state or its departments, agencies, boards or commissions and subject to any other terms and conditions that the department of administration determines are in the best interests of this state.

D. The department of administration may obtain insurance against loss, to the extent it is determined necessary and in the best interests of this state as provided in subsection G of this section for the professional liability of individual physicians and psychiatrists who provide services under a contract with the state department of corrections. Coverage is limited to acts and omissions committed inside a state department of corrections facility while in the performance of the contract and to individual physicians and psychiatrists who demonstrate to the satisfaction of the state department of corrections that they cannot otherwise obtain professional liability coverage for the services required by the contract. The director of the department of administration may impose on the state department of corrections a deductible for each loss that arises out of a professional liability claim pursuant to this subsection. Any changes in deductible amounts established by the director shall be subject to review by the joint legislative budget committee.

E. The department of administration may obtain property, liability, disability or workers' compensation insurance, self-insure or develop risk retention pools to provide for payment of property loss or casualty claims or disability insurance claims against contractors of this state with the approval of the joint legislative budget committee. With respect to insurance, self-insurance or risk retention pools for contractors licensed and contracted to do work for this state, the coverage afforded applies with respect to the conduct of the business entity of that contractor. The pool is available to all contractors regardless of the amount that the state-contracted work bears in relation to the amount of nonstate contracted work. The contractor shall be terminated from the pool if the contractor ceases to be a state contractor.

F. The department of administration may determine, in the best interests of this state, that state self-insurance is necessary or desirable and, if that decision is made, shall provide for state self-insurance for losses arising out of state property, liability or workers' compensation claims or for losses arising out of actual or suspected data breaches, security system breaches or security incidents prescribed by subsections A, C, D and E of this section. If the department of administration provides state self-insurance as prescribed in this section, such coverage shall be excess over any other valid and collectible insurance, notwithstanding any other insurance clause provided in the policy of the other valid and collectible insurance. If state self-insurance and any other valid and collectible insurance are determined to be primary insurance, the department of administration and other insurers shall contribute equal amounts until the applicable limit of insurance has been paid or none of the loss remains, whichever occurs sooner. The director of the department of administration may impose on state departments, agencies, boards and commissions a deductible for each loss that arises out of a property, liability or workers' compensation claim, actual or suspected data breach, security system breach or security incident pursuant to this subsection. Any changes in deductible amounts established by the director shall be subject to review by the joint legislative budget committee.

G. In carrying out this chapter, the department of administration shall establish and provide the state with some or all of the necessary risk management services, or shall contract for risk management services pursuant to chapter 23 of this title, as the director of the department of administration deems necessary in the best interest of the state, and in addition to other specifications of such coverage as deemed necessary, may determine self-insurance to be established. Chapter 23 of this title does not apply to the department of administration's procurement of insurance to cover losses arising out of state property or liability claims prescribed in this section or excess loss insurance for the state's workers' compensation liability for individual or aggregate claims, or both, in such amounts and at such primary retention levels as the department of administration deems in the best interest of this state. In purchasing insurance to cover losses arising out of property or liability claims prescribed by this section, the department of administration is not subject to title 20, chapter 2, article 5.

H. A successful bidder for risk management services pursuant to this section is not entitled to receive directly or indirectly any sales commission, contingent commission, excess profit commission, or other commissions, or anything of value, as payment for the risk management services except those amounts received directly from this state as payment for the risk management services.

I. The department of administration shall pay for purchased risk management services, premiums for insurance on state property and state liability and workers' compensation pursuant to this chapter.

J. A state officer, agent or employee acting in good faith, without wanton disregard of statutory duties and under the authority of an enactment that is subsequently declared to be unconstitutional, invalid or inapplicable, is not personally liable for an injury or damage caused thereby except to the extent that the officer, agent or employee would have been personally liable had the enactment been constitutional, valid and applicable.

K. A state officer, agent or employee, except as otherwise provided by statute, is not personally liable for an injury or damage resulting from an act or omission in a public official capacity where the act or omission was the result of the exercise of the discretion vested in the officer, agent or employee and if the exercise of the discretion was done in good faith without wanton disregard of statutory duties.

L. This state and its departments, agencies, boards and commissions are immune from liability for losses arising out of a judgment for wilful and wanton conduct resulting in punitive or exemplary damages.

M. The following exclusions shall apply to subsections A, B and F of this section:

Losses against and liabilities of a person who is provided insurance coverage pursuant to this chapter that arise out of and are directly attributable to an act or omission by the person that a court determines to be a felony.
Losses and liabilities arising out of contractual breaches.
Injury or damages expected or intended from the standpoint of the person insured pursuant to this chapter. This exclusion does not apply to law enforcement activities or operations, correctional activities or operations or injury or damages resulting from the use of reasonable force to protect an individual or property.

N. If self-insurance coverage is determined to exist, the attorney general, with funds provided by the department of administration, shall provide for the defense, either through the attorney general's office or by appointment of outside legal counsel, of this state and its departments, agencies, boards and commissions and all officers, agents and employees thereof and such others as are insured by the department of administration for or on account of their acts or omissions covered pursuant to this chapter. All state departments, agencies, boards and commissions, all officers, agents and employees thereof and such others as are insured by the department of administration shall cooperate fully with the attorney general and department of administration in the defense of claims arising pursuant to this chapter.

O. A claim for liability damages made pursuant to this chapter may be settled and payment made up to the amount of $100,000 or such higher limit as may be established by the joint legislative budget committee with the approval of the director of the department of administration. A claim may be settled and payment made over the amount of $100,000 up to $250,000 or such higher limit as may be established by the joint legislative budget committee with the approval of the director of the department of administration and the attorney general. Any claim may be settled and payment made over the amount of $250,000 or such higher limit as may be established by the joint legislative budget committee with the approval of the director of the department of administration, the attorney general and the joint legislative budget committee. If it is in the best interest of this state, the joint legislative budget committee may establish higher settlement limits. Any settlements involving amounts in excess of $250,000 or such higher limit as may be established by the joint legislative budget committee shall be approved by the department of administration, the attorney general and the joint legislative budget committee pursuant to the authority granted. The settlement of liability claims shall be solely the authority of the department of administration, the attorney general and the joint legislative budget committee. No state department, agency, board or commission or any officer, agent or employee of this state may voluntarily make any payment, assume any obligation, incur any expense or maintain the individual right of consent for liability claims made pursuant to this chapter except as provided by this section.

P. Neither the authority provided by this section to insure, nor the exercise of such authority, shall:

Impose any liability on this state or the departments, agencies, boards and commissions or any officers, agents and employees of this state unless such liability otherwise exists.
Impair any defense this state or the departments, agencies, boards and commissions or any officers, agents and employees of this state otherwise may have.

Q. Except as otherwise prescribed by this chapter and subject to any limit of state self-insurance and the terms of any insurance obtained by the department of administration, the department of administration shall pay, on behalf of any state officer, employee or person who is provided state self-insurance pursuant to this section, any damages, excluding punitive damages, for which the individual becomes legally responsible if the acts or omissions resulting in liability were within the individual's course and scope of employment. The department of administration may pay for all damages however designated that the officer, agent or employee becomes legally responsible for if the acts or omissions resulting in liability are determined by the director of the department of administration to be within the person's course and scope of employment.

R. The department of administration shall adopt such rules as are deemed necessary to carry out, implement and limit this chapter.

S. For the purposes of determining whether a state officer, agent or employee is entitled to coverage under this chapter, "within the course and scope of employment or authorization" means:

The acts or omissions that the state officer, agent or employee is employed or authorized to perform.
The acts or omissions of the state officer, agent or employee occur substantially within the authorized time and space limit.
The acts or omissions are activated at least in part by a purpose to serve this state or its departments, agencies, boards or commissions.

T. To the extent it is determined necessary and in the best interest of this state, the department of administration may obtain design and construction insurance or provide for self-insurance against property damage caused by this state, its departments, agencies, boards and commissions and all officers and employees of this state in connection with the construction of public works projects. Workers' compensation liability insurance may be purchased to cover both general contractors and subcontractors doing work on a specific contracted worksite. The department may include in its annual budget request, pursuant to section 41-622, subsection D, the cost of the insurance purchased or provided. In connection with the construction of public works projects, the department of administration may also use an owner-controlled or wrap-up insurance program if all of the following conditions are met:

The total cost of the project is over $50,000,000.
The program maintains completed operations coverage for a term during which coverage is reasonably commercially available as determined by the director of the department of insurance and financial institutions, but in no event for less than three years.
Bid specifications clearly specify for all bidders the insurance coverage provided under the program and the minimum safety requirements that shall be met.
The program does not prohibit a contractor or subcontractor from purchasing any additional insurance coverage that a contractor believes is necessary for protection from any liability arising out of the contract. The cost of the additional insurance shall not be passed through to this state on a contract bid.
The program does not include surety insurance.

U. The state may purchase an owner-controlled or wrap-up policy that has a deductible or self-insured retention as long as the deductible or self-insured retention does not exceed $1,000,000.

V. Notwithstanding any other statute the department of administration may:

Limit the liability of a person who contracts to provide goods, software or other services to this state.
Allow the person to disclaim incidental or consequential damages.
Indemnify or hold harmless any party to the contract.

W. The department of administration may intervene in a lawsuit against a person insured pursuant to this section to assert a defense on behalf of the person that the claimant failed to comply with section 12-821.01 or that a portion or all of the action is barred by section 12-821. The department is not required to exercise its right to intervene to claim that a portion or all of an insured person's liability is not for acts or omissions for which the person is afforded coverage pursuant to this section.

X. For the purposes of subsections T and U of this section:

"Owner-controlled or wrap-up insurance" means a series of insurance policies issued to cover this state and all of the contractors, subcontractors, architects and engineers on a specified contracted worksite for purposes of general liability, property damage and workers' compensation.
"Specific contracted worksite" means construction being performed at one site or a series of contiguous sites separated only by a street, roadway, waterway or railroad right-of-way, or along a continuous system for the provision of water and power.

Y. For the purposes of this section, "breach", "security system breach" and "security incident" have the same meanings prescribed in section 18-551.

§ 41-621.01 Contractors or subcontractors; pooling of property, liability and workers' compensation coverage; exemptions; board of trustees; contract; termination; audit; insolvency

A. Pursuant to section 41-621, subsection E and section 41-622.01 two or more contractors or subcontractors licensed to do work for this state or any political subdivision of this state may with the approval of the department of administration enter into contracts or agreements pursuant to this section for the joint purchase of insurance, to pool retention of their risks for property and liability losses and to provide for the payment of the property loss or claim of liability made against any member of the pool on a cooperative or contract basis with one another or may jointly form a nonprofit corporation or enter into a trust agreement to carry out this section in their behalf directly or by contract with a private party, if the department of administration has determined to sanction such a pool. Two or more contractors may also enter into contracts or agreements pursuant to this section to establish a workers' compensation pool to provide for the payment of workers' compensation claims pursuant to title 23, chapter 6 on a cooperative or contract basis with one another or may jointly form a nonprofit corporation or enter into a trust agreement to carry out this section in their behalf directly or by contract with a private party. A workers' compensation pool established pursuant to this subsection may provide coverage for workers' compensation, employers' liability and occupational disease claims. A workers' compensation pool is subject to approval as a self-insurer by the industrial commission of Arizona pursuant to section 23-961, subsection A, paragraph 2 and is subject to title 23, chapter 6 and rules adopted pursuant to that chapter in addition to the requirements of this section. The industrial commission of Arizona, by rule, resolution or order, may adopt requirements for the administration of a workers' compensation pool under this subsection, including separation or commingling of funds, accounting, auditing, reporting, actuarial standards and procedures.

B. In addition to other authority granted pursuant to this title, two or more contractors or subcontractors licensed to do work for this state or any political subdivision of this state may enter into contracts or agreements for the joint purchase of life insurance, disability insurance, accident insurance or health benefits plan insurance, to pool retention of their risks of loss for life, disability, health or accident claims made against any contractor or subcontractor member of the pool or to jointly provide the health and medical services authorized in section 36-2907. Contractors and subcontractors may establish pools for the purposes of this subsection by any of the following methods:

On a cooperative or contract basis.
By the formation of a nonprofit corporation.
By a contract or intergovernmental agreement with the Arizona health care cost containment system administration.
By the execution of a trust agreement directly by the contractors and subcontractors or by contracting with a third party.

C. Contractors or subcontractors of a political subdivision of this state that is a member of a risk retention pool authorized under title 11 may obtain life insurance, disability insurance, accident insurance or health benefits plan insurance coverage directly from that political subdivision if coverage is available and as authorized by section 11-952.01, subsection C.

D. Section 10-11301 does not apply to nonprofit corporations formed pursuant to this section.

E. Chapter 23 of this title does not apply to the procurement of insurance or to the procurement of the services provided for in subsection I, paragraph 8 of this section by any pool established pursuant to this section.

F. Title 43 does not apply to any pool established pursuant to this section. Any pool established pursuant to this section is exempt from taxation under title 43.

G. Each pool shall be operated by a board of trustees consisting of at least five members. The board of trustees of each group shall do all of the following:

Establish terms and conditions of coverage within the pool including exclusions of coverage.
Ensure that all claims are paid promptly.
Take all necessary precautions to safeguard the assets of the group.
Maintain minutes of its meetings.
Designate an administrator to carry out the policies established by the board of trustees and to provide day to day management of the group and delineate in the written minutes of its meetings the areas of authority it delegates to the administrator.
Notify the director of the department of insurance and financial institutions of the existence of the pool and file a copy of the agreement with the director and with the attorney general.
If the pool is a workers' compensation pool, file a copy of the agreement with the director of the industrial commission of Arizona.

H. The board of trustees shall not:

Extend credit to individual members for payment of a premium except pursuant to payment plans established by the board.
Borrow any monies from the group or in the name of the group except in the ordinary course of business.

I. A contract or agreement made pursuant to subsection A of this section shall contain the following:

A provision for a system or program of loss control.
A provision for termination of membership including either:

(a) Cancellation of individual members of the pool by the pool.

(b) Election by an individual member of the pool to terminate its participation.

A provision requiring the pool to pay all claims for which each member incurs liability during each member's period of membership.
A provision stating that each member is not relieved of its liability incurred during the member's period of membership except through the payment of losses by the pool or by the member.
A provision for the maintenance of claims reserves equal to known incurred losses and an estimate of incurred but not reported claims.
A provision for a final accounting and settlement of the obligations of or refunds to a terminating member to occur when all incurred claims are concluded, settled or paid.
A provision that the pool may establish offices where necessary in this state and employ necessary staff to carry out the purposes of the pool.
A provision that the pool may retain legal counsel, actuaries, auditors, engineers, private consultants and advisors.
A provision that the pool may make and alter bylaws and rules pertaining to the exercise of its purpose and powers.
A provision that the pool may purchase, lease or rent real and personal property it deems necessary.
A provision that the pool shall enter into a financial services agreement with banks and that it may issue checks in its own name.

J. A pool or a terminating member shall provide at least ninety days' written notice of the termination or cancellation. A workers' compensation pool shall notify the industrial commission of Arizona of the termination or cancellation of a member thirty days before the termination or cancellation of the member.

K. The pool shall be audited annually at the expense of the pool by a certified public accountant, with a copy of the report submitted to the governing body or chief executive officer of each member of the pool and to the director of the department of insurance and financial institutions. The board of trustees of the pool shall obtain an appropriate actuarial evaluation of the claim reserves of the pool including an estimate of the incurred but not reported claims. The department of insurance and financial institutions shall examine each contractor pool once every five years. The director of the department of insurance and financial institutions may examine a contractor pool sooner than five years from the preceding examination if the director has reason to believe that the pool is insolvent. The costs of any examination shall be paid by the pool subject to the examination.

L. If, as a result of the annual audit or an examination by the director of the department of insurance and financial institutions, it appears that the assets of the pool are insufficient to enable the pool to discharge its legal liabilities and other obligations, the director of the department of insurance and financial institutions shall notify the administrator and the board of trustees of the pool of the deficiency and provide the director's list of recommendations to abate the deficiency, including a recommendation not to add any new members until the deficiency is abated. If the pool fails to comply with the recommendations within sixty days after the date of the notice, the director shall notify the chief executive officer or the governing bodies, if any, of the members of the pool, the governor, the president of the senate and the speaker of the house of representatives that the pool has failed to comply with the recommendations of the director.

M. If a pool is determined to be insolvent or is otherwise found to be unable to discharge its legal liabilities and other obligations, each agreement or contract shall provide that the members of the pool shall be assessed on a pro rata basis as calculated by the amount of each member's annual contribution in order to satisfy the amount of deficiency. The assessment shall not exceed the amount of each member's annual contribution to the pool.

N. If a workers' compensation pool fails to comply with title 23, chapter 6 or rules adopted pursuant to that chapter, the director of the industrial commission of Arizona shall immediately notify the director of the department of administration and the director of the department of insurance and financial institutions.

§ 41-622 Risk management revolving fund; construction insurance fund; cyber risk insurance fund; self-insured losses and administrative costs; budget requests

A. The risk management revolving fund, the construction insurance fund and the cyber risk insurance fund are established in the department of administration for the purchase of insurance, risk management services including loss prevention services, payment of self-insured losses pursuant to section 41-621, subsections A, B, C, D, E and F and administrative costs necessary to carry out risk management services prescribed by section 41-621. The department of administration shall pay for claims processing costs, including adjusting costs, legal defense costs and attorney fees, for any portion of claims falling within state self-insurance coverage pursuant to this chapter.

B. The risk management revolving fund in the department of administration shall exclude any property loss arising from damage due to mechanical or electrical breakdown, ordinary wear and tear or obsolescence, nonserviceability, mysterious disappearance or inventory shortage. Mysterious disappearance does not include a loss if there is a reasonable presumption of theft. The department of administration, subject to chapter 23 of this title, may advance or disburse monies to contractors who rebuild state property as a result of self-insured losses or to persons who supply goods or services in replacing self-insured losses. The department of administration shall pay for claims processing costs, including adjusting costs, legal defense costs and attorney fees, for any portion of claims falling within state self-insurance coverage pursuant to this chapter.

C. To qualify for payment for loss by theft or burglary of state-owned personal property, an agency, department, board or commission must show evidence of forcible entry or that threat of violence was used in the taking of the property or there must be a reasonable presumption of theft.

D. The department of administration shall present to the legislature not later than September 1 of each year, in accordance with section 35-113, a budget request based on the actuarial needs for liability losses, workers' compensation liability losses, property losses, replenishment of the cyber risk insurance fund and risk management administrative costs. The budget request shall be broken down to reflect the amount of monies to be charged to each of the state departments, agencies, boards and commissions and any others insured under this chapter. Any state department, agency, board or commission that has an amount for insurance included in its appropriation, whether specifically stated or not, and any state department, agency, board or commission or others insured under this chapter that receive funds other than those appropriated shall be billed for the proportionate share of the charges for insurance or self-insurance by the department of administration. In collecting the agency billings for risk management charges, the director of the department of administration may transfer the entire amount of the billing for appropriated insurance from the agency account into the fund designated in subsection A of this section at the start of the fiscal year or in periodic payments during the fiscal year if necessitated by cash flow restrictions. Those entities or persons insured under this chapter that are not state agencies, departments, boards, commissions or employees or that do not receive funding from state sources shall pay annually the amount required by risk management to the risk management revolving fund or construction insurance fund before the coverage continues for existing claims or begins for new claims made. The construction insurance fund shall receive monies necessary to pay the cost of purchasing insurance, providing self-insurance or administering the fund as authorized by section 41-621, subsection T from each capital construction project budget at rates established by the department of administration and reviewed by the joint committee on capital review. These amounts shall be included in the budget request. All monies received from all billings shall be deposited in the funds as identified in subsection A of this section.

E. All monies recovered by the state pursuant to litigation, recovery, salvage value of damaged property, proportionate share monies from any other existing state funds, or otherwise, for damages relating to either a liability, property or workers' compensation loss for which monies from the risk management revolving fund or construction insurance fund have been or will be paid shall be deposited in the respective fund.

F. If a revolving fund is projected to be exhausted while the legislature is in session, a special appropriation may be requested by the department of administration for monies to meet the needs of the funds. If the funds are exhausted at a time when the legislature is not in session, any final judgment shall accrue interest and shall be payable on appropriation in the next succeeding regular session of the legislature. Interest on any judgment against this state paid for out of the risk management revolving fund or the cyber risk insurance fund, regardless of whether the funds are self-insured or funded by excess insurance, shall accrue at the average yield offered by United States treasury bills during the course of the appeal and shall be paid in accordance with this section. If the appeal is lost by this state, the judgment amount plus interest at the rate prescribed in this subsection shall be paid.

G. All monies deposited in the risk management revolving fund and the cyber risk insurance fund are subject to annual legislative appropriation to the department of administration for use pursuant to this section. Monies in the construction insurance fund are continuously appropriated for the fund purposes. The funds established by subsection A of this section are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

H. A $10,000 death benefit shall be paid from the risk management revolving fund to the estate of a deceased volunteer, who is registered as a volunteer by the agency, board or commission, or to an employee who is not subject to section 38-651.02, on proof of death while in the course and scope of duties as prescribed in section 41-621, subsection Q for any state agency, board or commission.

§ 41-622.01 Revolving fund for joint insurance purchase retention pools

A. A permanent special risk revolving fund is established in the department of administration for the purpose of administering joint insurance purchase, self-insurance or pooled retention plans for contractors of this state prescribed by section 41-621, subsection E. The fund shall be administered pursuant to section 41-621.01. Except if otherwise provided by law, this state shall not appropriate any monies from its general fund in the administration of pools within the special risk revolving fund.

B. The monies in the revolving fund may be invested pursuant to section 35-313. Interest earnings on the revolving fund shall be credited to the respective pools within the revolving fund.

C. If the revolving fund is projected to be exhausted the board of trustees shall make a special assessment on all members of a respective pool for monies to meet the needs of the fund. If the monies in the fund are exhausted a final claim settlement of judgment shall accrue interest at the legal rate and is payable on receipt of allocated income from members of the pool.

D. All monies deposited in the fund identified in subsection A of this section are appropriated to the department of administration for use pursuant to this section and are exempt from section 35-190, relating to lapsing of appropriations.

§ 41-622.02 Consumer loss recovery fund

A. A consumer loss recovery fund is established in the department of administration consisting of monies transferred to the fund from the budget stabilization fund established by section 35-144. Monies in the fund shall pay for claims, adjusting costs, processing costs, legal defense costs and administrative costs as provided by law.

B. The department of administration shall file a monthly report by the twenty-fifth day of the next month with the governor, the president of the senate and the speaker of the house of representatives. The monthly report shall include, at a minimum, the number of claims settled, the dollar costs associated with claims and the operating monies spent in support of the program.

C. All monies recovered by the state pursuant to litigation of false claims shall be deposited in the state general fund.

D. Monies in the consumer loss recovery fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-623 Risk management and loss control

A. The department of administration shall promulgate rules and regulations to initiate and implement a risk management and loss control program for all state departments, agencies, boards and commissions for the purpose of reducing risks, accidents and property liability and workers' compensation losses.

B. The department of administration shall annually provide each state department, agency, board and commission with a report of property, liability and workers' compensation claims filed and an analysis of the cause of loss. State departments, agencies, boards and commissions shall submit a reply to the department of administration outlining plans to correct property and liability exposures to loss.

C. The department of administration shall annually issue to the governor and legislature a summary report of property, liability and workers' compensation losses incurred by state departments, agencies, boards and commissions. The report shall include loss control plans and recommendations for corrective action.

D. All state departments, agencies, boards and commissions shall cooperate with, assist and provide requested information to the department of administration in the initiation, implementation and operation of the risk management and loss control program.

E. Concurrent with the commencement of planning for the construction, alteration or additions to state-owned or leased buildings, and the purchase of specialized personal property, the department of administration shall be consulted for the purpose of implementing the risk management and loss control program and to assure compliance with generally accepted loss control practices.

§ 41-624 Definitions; commissions on sales of insurance to the state; violation; classification

A. In this section, unless the context otherwise requires:

"Bidder" or "offeror" means a person who has submitted a bid or proposal for the sale of insurance to the state in response to a request for a proposal from the department of administration.
"Commissions" means any contingent commission, excess profits commission or other commission that may be based on losses or experience or other compensation that a successful contractor for the sale of insurance to the state may be eligible to receive from insurance carriers or underwriters.
"Solicitation" means all documents whether attached or incorporated by reference that are utilized for soliciting bids or proposals.

B. Only a contractor or persons who have performed actual services for a contractor in connection with a bid shall be eligible to receive directly or indirectly any commissions.

C. A contractor may pay commissions directly or indirectly only to persons who have performed actual services for the contractor in connection with the solicitation.

D. Any contractor who pays commissions in violation of subsection C of this section or any person who receives commissions in violation of subsection B of this section shall be subject to the following penalties:

The contractor or the person who receives commissions, or both, shall be guilty of a class 2 misdemeanor.
The contractor or the person who receives the commissions, or both, shall be liable under section 20-295 for suspension, revocation or denial of renewal of any licenses issued under title 20, chapter 2, article 3, 3.1, 3.2, 3.3 or 3.5.
The contractor and the person who receives commissions shall be jointly and severally liable to the state for the amount of the commissions paid in violation of subsection B or C of this section.
The contractor and the person who receives the commissions shall be jointly and severally liable to competing bidders or offerors under the same solicitation for the amount of the commissions paid in violation of subsection B or C of this section as well as for reasonable attorney fees of the competing bidders or offerors in recovering the penalty. Where there is more than one competing bidder or offeror, the contractor and the person who receives commissions shall be subject only to one liability under this subsection and the competitors who have joined in or intervened before judgment in the first action under this subsection to proceed to final judgment shall be entitled to equal shares in the penalty recovered.

§ 41-625 Environmental risk management; purpose; administration

A. Environmental risk management responsibility is established within the department of administration. The department of administration shall use resources from the risk management revolving fund to prevent, manage and remedy environmental damage and health threats associated with property and facilities owned or operated by this state on or at which materials, operations and hazardous wastes are located or conducted, including the following functions:

Investigation of release of hazardous substances.
Site characterization.
Analysis and feasibility studies.
Remedial action.
Site maintenance.
Loss prevention and reduction expenses.

B. The department of administration shall pay from the risk management revolving fund environmental property and environmental liability claims and processing costs including adjusting costs, legal defense costs and attorney fees.

C. Actuarial projections of the costs for environmental property and liability claims shall be obtained each year in the same manner as those for property and casualty claims. Monies requested for the risk management revolving fund as specified in section 41-622, subsection D shall include monies to pay for environmental property and liability claims, lawsuits and costs.

§ 41-626 Mobile food vendors; insurance requirement prohibited; definition

A. This state or any department or agency of this state may not require a mobile food vendor to maintain an insurance policy that names this state as an additional insured unless the mobile food vendor is attending an event sponsored by this state.

B. For the purposes of this section, "mobile food vendor" means any person who owns, controls, manages or leases a mobile food unit or contracts with a person to prepare foods and vend from, drive or operate a mobile food unit.

Chapter 4 Department of Administration and Personnel Board

Article 1 General Provisions

§ 41-701 Department of administration; director; appointment

A. A department of administration is established.

B. The direction, operation and control of the department is the responsibility of the director.

C. The director shall be appointed by the governor with the advice and consent of the senate and shall serve at the pleasure of the governor.

§ 41-701.01 Definitions

In this chapter, unless the context otherwise requires:

"Department" means the department of administration.
"Director" means the director of the department of administration.

§ 41-702 Deputy director; department organization; assistant directors; compensation of officers

A. The director with the approval of the governor shall appoint a deputy director of the department. The deputy director serves at the pleasure of the director and shall assist the director in administering the department by performing the duties and responsibilities that the director prescribes.

B. The director may establish, abolish or reorganize the positions or organizational units within the department, subject to legislative appropriation, if in the director's judgment such modification of organization would make the operation of the department more efficient, effective or economical.

C. The director, with approval of the governor, shall appoint an assistant director qualified to head each division, and each assistant director shall serve at the pleasure of the director. Each assistant director is responsible for the functions performed by the assistant director's division.

D. The director, deputy director and assistant directors are eligible to receive compensation pursuant to section 38-611.

§ 41-703 Duties of director

The director shall:

Be directly responsible to the governor for the direction, control and operation of the department.
Provide assistance to the governor and legislature as requested.
Adopt rules the director deems necessary or desirable to further the objectives and programs of the department.
Formulate policies, plans and programs to effectuate the missions and purposes of the department.
Employ, determine the conditions of employment and prescribe the duties and powers of administrative, professional, technical, secretarial, clerical and other persons as may be necessary in the performance of the department's duties and contract for the services of outside advisors, consultants and aides as may be reasonably necessary.
Make contracts and incur obligations within the general scope of the department's activities and operations subject to the availability of monies.
Contract with or assist other departments, agencies and institutions of the state, local and federal governments in the furtherance of the department's purposes, objectives and programs.
Accept and disburse grants, gifts, donations, matching monies and direct payments from public or private agencies for the conduct of programs that are consistent with the overall purposes and objectives of the department.
Establish and maintain separate financial accounts as required by federal law or regulations.
Advise and make recommendations to the governor and the legislature on all matters concerning the department's objectives.
Delegate the administrative functions, duties and powers as the director deems necessary to carry out the efficient operation of the department.

§ 41-703.01 Competitive grant program; technology solution; patient continuity of care; hospital interconnectivity; annual report; definitions

(Rpld. 7/1/26)

A. The department shall administer a three-year competitive grant program that provides an interoperability software technology solution to support rural hospitals, health care providers and urban trauma centers to further treatment care coordination with a focus on reducing public and private health care costs and unnecessary transportation costs.  The department shall award the first grant under this program not later than December 31, 2022.

B. The Arizona health care cost containment system shall work with the department to supplement the grant monies by identifying and applying to receive federal matching monies.

C. The grant program shall enable the implementation of an interoperability software technology solution that is shared by hospitals and health care providers to benefit patients before and after a patient is discharged from the provider's care.

D. The software shall be made available to rural hospitals, health care providers and urban trauma centers that wish to participate by enabling a hospital's electronic medical records system to interface with other electronic medical records systems and providers to promote connectivity between hospital systems and facilitate increased communication between hospital staff and providers that use different or distinctive online platforms and information systems when treating patients. The department shall award grants for an interoperability software technology solution that, at a minimum:

Complies with the health insurance portability and accountability act privacy standards (45 Code of Federal Regulations part 160 and part 164, subpart E).
Captures and forwards clinical data, including laboratory results and images, and provides synchronous patient clinical data to health care providers regardless of geographic location.
Provides a synchronous data exchange that is not batched or delayed, at the point the clinical data is captured and available in the hospital's electronic record system.
Is capable of providing proactive alerts to health care providers.
Allows both synchronous and asynchronous communication.
Has patient-centric communication and is tracked with date and time stamping.
Is connected to the appropriate physician resources.
Provides data to update cost reports to enhance emergency triage and to treat and transport patients.

E. Each grant recipient shall demonstrate proof of veteran employment.

F. For each year of the grant program, each grant recipient shall provide to the department of administration a report that provides metrics and quantifies cost and time savings for using an interoperable software solution in health care that complies with the health insurance portability and accountability act privacy standards (45 Code of Federal Regulations part 160 and part 164, subpart E). On or before July 1 of each fiscal year of the grant program, the department of administration in coordination with the Arizona health care cost containment system shall provide to the president of the senate, the speaker of the house of representatives, the chairpersons of the health and human services committees of the senate and the house of representatives and the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting a report on the allocation of grant funding and a compiled analysis of the reports provided by the grant recipients.

G. For the purposes of this section:

"Rural" mean a county with a population of less than nine hundred thousand persons.
"Veteran employment" means a business organization that employs an individual or has a company officer who served and who was honorably discharged from or released under honorable conditions from service in the armed forces.

§ 41-704 Emergency telecommunication services; administration; annual report; revolving fund

A. The director of the department of administration shall:

Adopt rules and procedures for administering and disbursing monies deposited in the emergency telecommunication services revolving fund, and at least quarterly review and approve requests by political subdivisions of this state for payment for operating emergency telecommunication service systems.
In fiscal year 2001-2002 and every two years thereafter, recommend to the legislature the amount of the telecommunication services excise tax that will be required during the following two fiscal years for the purposes of this section, with supporting documentation and information. The legislature shall review the recommendation and take legislative action regarding the recommendation.
On or before December 1 of each year, submit a report to the director of the joint legislative budget committee containing:

(a) The department's expenditure plan for the current fiscal year for the emergency telecommunication services revolving fund established by this section.

(b) The status of the department's implementation of improvements to the 911 emergency system.

B. The emergency telecommunication services revolving fund is established to be administered by the director. The fund shall be used for:

Necessary or appropriate equipment or service for implementing and operating emergency telecommunication services through political subdivisions of this state. Priority shall be given to establishing emergency telecommunication services in those areas of the state that are without emergency telecommunication services.
Necessary or appropriate administrative costs or fees for consultants' services, not to exceed five percent of the amounts deposited annually in the revolving fund. The department may use up to two-thirds of the five percent of the amounts deposited annually in the revolving fund for administrative costs. The remainder of the five percent may be allocated for local network management of contracts with public safety answering points for emergency telecommunication services.
Monthly recurring costs of emergency telecommunication services, including expenditures for capital, maintenance and operation purposes.
A wireless carrier's costs associated with the provision, development, design, construction and maintenance of the wireless emergency telecommunication services in an amount that the wireless carrier has not recovered through the deduction mechanism specified in federal law.

C. At the end of each fiscal year, any unexpended monies in the fund, including interest, shall be carried over and do not revert to the state general fund but shall be applied to the extent possible to reduce the levy under section 42-5252, subsection A for the following fiscal year.

§ 41-705 Racing investigation fund; distributions; refund

A. The racing investigation fund is established consisting of monies deposited for the projected cost of investigations conducted pursuant to title 5, chapter 1 by persons, partnerships, associations or corporations that hold a permit for a racing meeting under title 5. Monies deposited into the fund shall be made in a reasonable amount based on a request from the director of the department of gaming. The department of administration shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies distributed from the fund are subject to the following restrictions:

Distributions shall be made pursuant to instructions from the director of the department of gaming to the director of the department of administration.
Distributions shall be limited to expenses that are authorized under title 5, chapter 1, article 1 and that are incurred in compliance with chapter 23 of this title including open and competitive bidding for all services.

C. On the instruction of the director of the department of gaming, the department of administration at the conclusion of an investigation shall refund to the permittee the difference between the amount deposited into the fund by that permittee and the total actual cost of the investigation.

§ 41-706 State employee living donor leave; definitions

A. An employee is entitled to a leave of absence for the time specified for the following purposes:

Five work days to serve as a bone marrow donor for a bone marrow transplant if the employee provides the employee's employer with written verification that the employee is to serve as a bone marrow donor.
Thirty work days to serve as an organ donor for a human organ transplant if the employee provides the employee's employer with written verification that the employee is to serve as an organ donor.

B. An employee who is granted a leave of absence pursuant to this section is entitled to receive base pay without interruption during the leave of absence. For the purpose of determining seniority, pay or pay advancement and performance awards and for the receipt of any benefit that may be affected by a leave of absence, the service of the employee is considered uninterrupted by the leave of absence.

C. The employer shall not penalize an employee for requesting or obtaining a leave of absence pursuant to this section.

D. For the purposes of this section:

"Bone marrow" means the soft material that fills human bone cavities.
"Bone marrow transplant" means the medical procedure by which transfer of bone marrow is made from the body of a person to the body of another person.
"Employee" means a person employed in a position in any office, board, commission or department in state government, a person employed by the judiciary or a person employed by a university under the jurisdiction of the Arizona board of regents or a community college district.
"Human organ transplant" means the medical procedure by which transfer of an organ or part of an organ is made from the body of a person to the body of another person.
"Organ" means human organs or parts of an organ that are capable of being transferred from the body of a person to the body of another person.

§ 41-707 Investment yield restriction report

On or before October 1 of each year, the director shall submit to the joint legislative budget committee and the governor's office of strategic planning and budgeting a report on the costs associated with meeting the investment yield restriction requirements for any tax-exempt deficit financing agreements entered into on or after January 1, 2009, including whether the requirements have reduced the yield of investments or required the state to pay any penalties to the federal government.

§ 41-708 Annual report; state employee salaries; full-time equivalent positions; definitions

A. On or before October 1 of each year, the department shall collect from each budget unit and shall submit to the joint legislative budget committee and the governor's office of strategic planning and budgeting a report containing the number of full-time equivalent positions and the total amount of salaries for each budget unit for the prior fiscal year, delineated by:

Retirement system.
Employee tier.
Fund source.

B. For the purposes of this section:

"Budget unit":

(a) Means a department, commission, board, institution or other agency of this state that receives, expends or disburses state monies or incurs obligations of this state.

(b) Does not include the Arizona board of regents, universities under the jurisdiction of the Arizona board of regents and community college districts.

"Employee tier" means a class of employees in a retirement system in which each employee is subject to the same employer contribution rate pursuant to title 38, chapter 5.

§ 41-709 Gifts and donations for employee recognition

A state department or agency may accept gifts and donations from a public entity, a private entity or any person for the conduct of employee recognition programs. Gifts and donations for employee recognition programs are subject to the requirements of title 35, chapter 1, article 3 and chapter 23 of this title.

§ 41-710 Information technology personnel; criminal history records; definitions

A. Before accepting an offer of employment, an applicant for an information technology position in the department of administration shall submit a full set of fingerprints to the department of administration for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The director of the department of administration shall request personnel who were employed in information technology positions on or before July 18, 2000 to submit a full set of fingerprints if the director determines that it is necessary to ensure the privacy, confidentiality or integrity of data within the department's control. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

B. The department of administration shall not disclose information obtained pursuant to subsection A of this section except to members of the department's staff solely for the purpose of employment of information technology personnel by the department.

C. For the purposes of this section:

"Applicant" means any person who seeks employment as a new hire or any employee of the department of administration who seeks a transfer, a reclassification or a reassignment to an information technology position.
"Information technology position" means any position that is in the department of administration, that requires the operation of computer systems that contain or transmit data to which access is restricted by virtue of applicable federal or state laws, rules or regulations and that requires access to the restricted data in order to fulfill the requirements of the position.

§ 41-710.01 Reimbursement of transportation and telecommuting costs; definition

A. The director shall adopt rules to provide for the reimbursement of up to one hundred per cent of the cost to state employees of either:

Public transportation, vanpool or private bus service to and from their place of employment.
Telecommuting connectivity.

B. For the purposes of this section, "public transportation" means local transportation of passengers by means of a public conveyance operated or licensed by an incorporated city or town or a regional public transportation authority.

§ 41-710.02 Skilled through alternative routes; state employment applicants; report; definition

A. The director shall evaluate all state employee positions and identify the positions that are suitable for skilled through alternative routes applicants.

B. The department's online state jobs application portal shall identify those positions that are suitable for applicants who have postsecondary degrees and those positions that are suitable for skilled through alternative routes applicants.

C. On or before October 1, 2023, the director shall submit a report that details which state employee positions may be modified to accept skilled through alternative routes applicants to the governor, the president of the senate and the speaker of the house of representatives and shall submit a copy of this report to the secretary of state.

D. For the purposes of this section, "skilled through alternative routes applicant" means an individual who has developed skills through job training, community college, military service or an apprenticeship and who meets all of the following:

Is currently active in the workforce.
Has a high school diploma or the equivalent of a high school diploma.
Does not have a bachelor's degree or graduate degree.

§ 41-710.03 Erroneous convictions fund

(Rpld. 7/1/27)

A. The erroneous convictions fund is established consisting of monies appropriated to the fund by the legislature. The department of administration shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. The department of administration shall use the monies deposited in the erroneous convictions fund to fund claims brought pursuant to title 13, chapter 38, article 36.

Article 2 Automation and Telecommunications Functions

§ 41-711 Establishment of automation operation center; fund; report

A. The department may establish an automation operation center to serve the management and other needs of state government.

B. An automation operations fund is established for paying for the costs of any automation operation applications implemented by the department and otherwise allowed by law.

C. The fund consists of:

Legislative appropriations.
Grants, except for otherwise specifically dedicated grants, received for automation operations, consolidation and cost reduction or cost avoidance functions.
Monies derived from implementing and operating an automation program.
Monies derived from the sale or exchange of automation assets.
Monies derived from agencies and political subdivisions and other states or their agencies in payment for services provided by the department's automation operation center.

D. The department of administration shall administer the fund. Separate accounts shall be established to account for monies received and spent pursuant to automation agreements with other states or their agencies or the Arizona health care cost containment system administration in fulfillment of an agreement entered into pursuant to section 36-2925. The separate accounts are continuously appropriated for the purposes specified in the agreements. All other monies in the fund are subject to annual legislative appropriation to the department.

E. In connection with its annual budget request to the legislature, the department shall prepare a report that accounts for all monies deposited in the fund, the sources of the monies received for deposit, the purposes for which the fund monies were used during the preceding fiscal year and the plans for using fund monies during the next fiscal year.

F. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-712 Telecommunications program office; state contractor; cost of operation; employees; report; exception

A. The director shall establish a telecommunications program office within the department to enter into a primary contract with a corporation authorized to do business in this state for the contractor to provide for the installation and maintenance of telecommunication systems and to act as the state's agent for telecommunication carrier services to the offices, departments and agencies of this state. Each office, department and agency of this state shall contract with the primary contractor through the telecommunications program office and make payment to the primary contractor for its telecommunications needs.

B. With the approval of the director, the telecommunications program office may enter into more than one contract for each statewide telecommunications product or service not provided by the primary contractor.

C. The director shall pay administrative costs of the telecommunications program office, and each office, department or other state agency shall pay from available monies the proportionate cost of administration of the office as determined by the director. In carrying out this subsection, the director shall only employ those contract managers, telephone operators, help desk personnel and forensic investigators required to oversee the primary contract and administer efficiently the telecommunications program office.

D. The department shall prepare and submit an annual consolidated telecommunications budget report to the joint legislative budget committee in connection with its annual budget request showing the previous fiscal year's actual payments and the next fiscal year's anticipated payments charged and received by the primary contractor from state offices, departments and agencies for telecommunications services.

E. All procurement pursuant to this section shall be as prescribed in chapter 23 of this title unless otherwise provided by law.

F. Any contract involving the use of a state highway right-of-way is subject to approval pursuant to sections 28-304, 28-363, 28-7045, 28-7048 and 28-7209.

G. This section does not apply to the cotton research and protection council established by section 3-1082.

§ 41-713 Telecommunications fund; report

A. A telecommunications fund is established for paying costs incurred in operating the telecommunications program office established pursuant to section 41-712.

B. The fund consists of:

Legislative appropriations.
Grants, except for otherwise specifically dedicated grants, received for telecommunication operations, consolidation and cost reduction or cost avoidance functions.
Monies derived from administering the telecommunications program office.
Monies derived from the sale or exchange of telecommunications assets or any assets that may be used to provide telecommunication access.
Monies derived from agencies and political subdivisions and other states or their agencies in payment for services provided by the telecommunications program office established pursuant to section 41-712.

C. The department of administration shall administer the fund. All monies in the fund, including subaccounts and private accounts such as the infrastructure investment account, are subject to annual legislative appropriation to the department.

D. In connection with its annual budget request to the legislature, the department shall prepare a report that accounts for all monies deposited in the fund, the sources of the monies received for deposit, the purposes for which the fund monies were used during the preceding fiscal year and the plans for using fund monies during the next fiscal year.

E. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-714 Automation projects fund; subaccounts; exemption; annual report; purpose; joint legislative budget committee review

A. The automation projects fund is established consisting of monies appropriated by the legislature. The department of administration shall administer the fund. Monies in the fund are subject to legislative appropriation. The director shall establish a separate subaccount for each agency that implements, upgrades or maintains automation and information technology projects. Monies in each subaccount are subject to legislative appropriation. Monies may not be transferred between agency subaccounts and are exempt from the provisions of section 35-190 relating to lapsing of appropriations, except that on completion of an automation and information technology project, all monies remaining unexpended and unencumbered in the subaccount revert to their fund of origin. On or before September 1 of each year, the department shall submit a report to the joint legislative budget committee on each reversion made pursuant to this subsection in the prior fiscal year.

B. Monies in the fund shall be used to implement, upgrade or maintain automation and information technology projects for any state agency.

C. Before the expenditure of any monies from the fund, the joint legislative budget committee shall review the expenditure plan presented by the department for the fiscal year in which the monies are to be spent. The expenditure plan shall include the project cost, deliverables, timeline for completion and method of procurement.

Article 3 Finance

§ 41-722 Powers and duties relating to finance

A. The department shall assist the governor in his duties pertaining to the formulation of the budget, and shall correlate and recommend revision of estimates and requests for appropriations of the budget units.

B. The director shall:

Make changes or improvements in state accounting practices, systems and procedures as he deems advisable.
Continually evaluate and plan improvements of state fiscal matters and annually submit his recommendations to the governor.
Recommend to the governor such administrative reorganization and management practices as he deems necessary for the economical and efficient operation of state government.
Develop and maintain, in cooperation with each state agency and recommend to the governor a comprehensive, long-range plan for capital outlay, consistent with means available for financing the same.
Promulgate rules, regulations or procedures to carry out the provisions of this article.

§ 41-723 Governor's office of strategic planning and budgeting; duties

The director of the governor's office of strategic planning and budgeting shall:

Confer with officials of federal agencies concerning grants-in-aid generally, and particularly in regard to federal-aid programs in progress in this state.
On or before September 1 of each year or with the submission of budget estimates as provided in section 35-113, report to the staff of the joint legislative budget committee findings and recommendations in the following areas:

(a) Except for a university under the jurisdiction of the Arizona board of regents, the use of federal monies by any state agency that receives federal monies, that anticipates receipt of federal monies or that administers a program supported by federal monies. A university shall submit an audited schedule of federal award spending for the preceding fiscal year to the staff of the joint legislative budget committee. The reports that all state agencies, except universities, are required to submit must:

(i) Delineate the federal monies received for the preceding fiscal year.

(ii) Delineate the federal monies to be used by the state agency for the current and upcoming fiscal year, including any programs supported by federal monies in which the loss of federal monies may impact the continuity or delivery of services.

(iii) Identify the date, if known, on which federal monies are set to expire.

(iv) Identify any obligations, agreements, joint exercise of powers agreements, maintenance of efforts agreements or memoranda of understanding that may be impacted by federal or state decisions regarding federal receipts, including any state matching requirements.

(v) Calculate the percentage of federal monies from the total monies available for the state agency for the fiscal year.

(b) If any state agency received notice of a reduction in federal monies from a specific federal grant of fifty percent or more from the previous fiscal year's funding, identify the plan to either reduce or eliminate the services provided through the grant or to continue services without any increase to any state resources.

(d) Legislation necessary for activation of federal programs in which this state does not participate.

(e) Legislation necessary for improved operation of federal grant-in-aid programs in progress in this state.

(f) The advisability of accepting new grant-in-aid programs or discontinuing programs already in progress.

Have access to the books, accounts, reports and vouchers and all other pertinent records of all state agencies for the purpose of carrying out the provisions of this section.

§ 41-724 Exemptions

A. The Arizona board of regents, the Arizona commerce authority and the legislative and judicial branches of state government shall not be subject to the provisions of this article except as prescribed by law.

B. The Arizona board of regents and the judicial branch of state government shall be subject to the provisions of sections 35-112 and 35-113.

§ 41-725 Comprehensive database of receipts and expenditures of state monies; local reporting; definition

A. The department shall establish and maintain an official internet website that is electronically searchable by the public at no cost and that contains a comprehensive database of receipts and expenditures of state monies. The database shall include the information as prescribed in the comprehensive annual financial report of a budget unit that has been made by a certified public accountant who is currently certified by the Arizona state board of accountancy or who has a limited reciprocity privilege pursuant to section 32-725 and who is not an employee of the department. The report shall be made in accordance with generally accepted auditing standards and shall contain financial statements that are in conformity with generally accepted accounting principles. If the department has a comprehensive annual financial report of a budget unit that has been presented with a certificate of achievement for excellence in financial reporting by the governmental finance officers association, the department may post such a financial report to satisfy the requirements of this subsection.

B. The department must present information in the database in a manner that is intuitive to members of the general public, including graphical representations. The database must allow users to:

Search and aggregate payments by individual budget units and programs.
Search and aggregate payments by individual vendors, including the total amount of state funding awarded by all budget units to individual vendors.
Download information yielded by a search of the database.
Access electronic versions of contracts that relate to expenditures.

C. The database shall include the following information:

Annual receipts of revenues, including:

(a) Receipts or deposits by each state budget unit into funds established in the state treasury.

(b) Taxes.

(c) Earnings by each budget unit, including amounts collected for merchandise sold, services performed and licenses, certifications and permits issued.

(d) Revenue from the use of publicly owned money or property, including leases and licenses.

(e) Gifts, donations and grants received, including amounts received from the federal government.

(f) Any other type of public revenue, however denominated or derived, deposited into the state treasury.

Annual expenditures and disbursements of state revenues by each state budget unit from funds established in the state treasury, as applicable, including:

(a) Bond payments, debt service and redemption charges and fees.

(b) Contractual services and cooperative agreements.

(d) Capital outlay.

(e) Revenue sharing and other aid to other levels of government, including tribal governments.

(f) Any other expenditure or disbursement of state revenue from the state treasury, however denominated or structured.

D. Expenditure data shall list:

The manner of payment, including check or warrant or credit, debit or other purchase card.
The funding source, including categorical codes and the state accounts the expenditure is appropriated from.
A standardized descriptive title of the type and purpose of the transaction.
The date and amount of each payment.
The state agency or budget unit making the payment.
The name of the person or entity receiving the payment, including to the extent practicable a parent entity of the recipient if the recipient is owned by another entity.
The primary location of performance under the contract, including the county, city or town and legislative district.

E. The database shall not include:

Tax payment or refund data that include confidential taxpayer information.
Data relating to payments of state assistance to individual recipients.
Payees' addresses or telephone numbers, but the department may allow public access in the database to information identifying the county in which the payee is located.
Work product in anticipation of litigation or information subject to attorney-client privilege.
Any other information that is designated by law as confidential or preapproved as confidential by the department pursuant to rule. The department and any officer or employee of the department:

(a) May rely on a determination made by a budget unit regarding confidentiality of information relating to the budget unit's expenditures.

(b) Are immune from civil liability for posting confidential information under this section if the posting is in reliance on the budget unit's determination relating to confidentiality.

F. Each budget unit shall cooperate with the department as necessary to implement and administer this section. Each budget unit shall provide to the department any additional data in a manner and schedule prescribed by the department that are required to be included in the database. The database shall be updated within thirty days after the end of each fiscal year and may be updated as new data become available. The data shall be retained in the database for at least ten full fiscal years.

G. The governor, secretary of state, state treasurer and legislature shall include a link to the database under this section in their individual official websites. Each budget unit that maintains a generally accessible internet website, or for which a generally accessible website is maintained, shall include a link on that website to the database under this section.

H. Each local government shall establish and maintain an official internet website that is accessible to the public at no cost and that contains a comprehensive reporting of all revenues and expenditures over five thousand dollars of local monies in as nearly as practicable the same manner and consistent with subsections B through E of this section. The database shall include the information as prescribed in the comprehensive annual financial report of a budget unit that has been made by a certified public accountant who is currently certified by the Arizona state board of accountancy or who has a limited reciprocity privilege pursuant to section 32-725 and who is not an employee of the local government. The report shall be made in accordance with generally accepted auditing standards and shall contain financial statements that are in conformity with generally accepted accounting principles. If a local government has a comprehensive annual financial report of a budget unit that has been presented with a certificate of achievement for excellence in financial reporting by the governmental finance officers association, the local government may post such a financial report to satisfy the requirements of this subsection. A link to this data shall be displayed in a prominent place on the local government's official internet website or on a website of an association of cities and towns for cities and towns that do not have official websites and on the department's official internet website as prescribed in this section. The data shall be updated no less frequently than every three months and may be updated as new data becomes available. The data shall be retained and accessible online for at least three fiscal years.

I. For the purposes of this section "local government" means:

A county, city or town with a population of more than twenty-five hundred persons.
Any community college district and school district having a student count of more than six hundred pupils.
A state university.

§ 41-726 Debt; annual report; definition

A. Beginning on or before December 1, 2013 and each December 1 thereafter, the department shall submit a report to the speaker of the house of representatives, the president of the senate and the staff director of the joint legislative budget committee that addresses the cost to this state to pay the remaining balance of any outstanding state debt and obligations and, based on the current interest rates, the interest that would be saved. The report shall include an analysis that gives the amount of the savings if this state pays the outstanding state debt and obligations, under current economic conditions, in increments of fifty million dollars up to two hundred million dollars. The analysis shall focus on approaches that would produce the highest cost savings to this state.

B. For the purposes of this section, "state debt and obligations" means the following obligations that are paid with state general fund monies:

Outstanding general obligation bonds.
Long-term notes and obligations.
Certificates of participation and other obligations pursuant to any lease-purchase agreement.
Revenue bonds.

§ 41-732 Duties relating to general accounting activities

A. The director or the director's authorized representative shall be the general accountant of this state and keeper of all public account books, vouchers, documents and papers relating to accounts and contracts of the state, and to its revenue, debts and fiscal affairs, not required by law to be placed in some other office or kept by some other person.

B. The general accountant shall:

Draw all payments upon the treasury for money, except in cases otherwise expressly provided by law. The general accountant shall maintain a record of all warrants drawn and electronic funds transfers, by number, date of issue, payee and amount.
Keep, or require budget units to keep, an account of all debts and credits between this state and the United States, and between this state and every other state, officer or person with whom this state has financial dealings, and of any separate fund of this state, or touching any duty of the general accountant's office.
Upon approval by the governor, give information in writing to any person authorized by law to examine the general accountant's accounts or papers, when required, upon any subject relating to the fiscal affairs of this state or touching any duty of his office.
Keep a seal of office which shall be used to authenticate all warrants signed by the general accountant and all writings, papers and documents certified from the office of the general accountant.

§ 41-733 Examination of witnesses

When it is necessary in the exercise of his powers and duties, the director or his authorized agents may examine the parties and others on oath, touching any material matters, and for that purpose may administer oaths, issue subpoenas and compel witnesses to attend before him and give evidence, in the same manner and by the same means allowed by law to courts of record.

§ 41-734 Preservation of accounts; copies; fees

All accounts, vouchers, warrants, claims and supporting documents shall be preserved by the department pursuant to section 41-151.14 and copies of these documents shall be given to any person who applies for them and who tenders the fees as prescribed by the director.

§ 41-735 Internal audit; authority to examine records; divulgence of restricted information; violation; classification; public records exception

A. Except as provided in subsection C, the department shall have access to, and authority to examine, any and all books, accounts, reports, vouchers, correspondence files and other records, bank accounts, money and other property of any state agency, whether created by the constitution or otherwise. An officer or employee of any such agency, having such records under his control, shall permit access to and examination thereof upon the request of the director or his authorized representative. Any officer or person who knowingly fails or refuses to permit such access and examination is guilty of a class 2 misdemeanor.

B. If the director or any member of his staff or other employee knowingly divulges or makes known in any manner not permitted by law any particulars of any record, document or information the disclosure of which is restricted by law he is guilty of a class 5 felony.

C. Books, accounts, reports or other records which are prescribed confidential with limited access by either state or federal law are not subject to examination under this section.

D. Draft working papers and other draft audit files maintained by the department are not public records and are exempt from title 39, chapter 1. The information contained in draft working papers and draft audit files prepared pursuant to a specific audit is not subject to disclosure, except to the attorney general or to any county attorney in connection with an investigation made or action taken in the course of their official duties. On completion and issuance of the final audit report, draft working papers and draft audit files become public records.

§ 41-736 Forest reserve monies

When this state receives any monies that belong to the counties from the federal government from forest reserves the department shall:

Determine the amount to pass through to each county according to the forest acreage report for each county.
Distribute the monies as directed by the federal government among these counties.
Transmit these payments to the county treasurers for deposit in their respective county general funds.

§ 41-737 Forms for reports by county assessors and treasurers

The department shall cause suitable forms to be printed for use of the several county assessors in taking statistics as required by law, and for use of the several county treasurers in making reports to the department. The department shall pay for the printing of such forms.

§ 41-738 Membership in national organizations; attending conventions

The director or his authorized representative is authorized to hold membership in, and to maintain membership by payment of dues to, the national organizations of state officials occupying a like office or performing similar functions, and is authorized to attend annual conventions of such national organizations.

§ 41-739 Drawing illegal warrant; classification

If the director or any employee or officer of the department knowingly issues a warrant upon the treasury not authorized by law, he is guilty of a class 6 felony.

§ 41-740 Nonperformance of duty; classification

If the director or any duly appointed officer or supervisor charged with duties and responsibilities under this article knowingly fails or refuses to perform any duty required of him by law, he is guilty of a class 1 misdemeanor.

§ 41-740.01 Arizona financial information system collections fund; purpose; transaction fee; joint legislative budget committee; annual report

A. The Arizona financial information system collections fund is established consisting of monies collected pursuant to subsection C of this section. The department shall administer the fund. Monies in the fund are subject to legislative appropriation. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies in the fund shall be used to reimburse the department for the costs of operating the Arizona financial information system.

C. The department may charge a transaction fee to each state agency that uses the Arizona financial information system. The department shall submit a proposed transaction fee to the joint legislative budget committee before establishing or changing the fee. On or before December 1 of each year, the department shall submit a report to the joint legislative budget committee on the Arizona financial information system transaction count by agency and fund source.

Article 4 State Personnel System

§ 41-741 Definitions

In this article and articles 5 and 6 of this chapter, unless the context otherwise requires:

"Appointing authority" means the person or group of persons authorized by law or delegated authority to make appointments to fill positions.
"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.
"Break in service" means a separation from state employment, regardless of the reason for separation.
"Change in assignment" means movement of an employee to a different position in the same state agency or another state agency.
"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.

"Covered service" means that employment status conferring rights of appeal as prescribed in sections 41-782 and 41-783 or section 41-1830.16, as applicable.
"Director" means the director of the department of administration, or the director's designee, who is responsible for administering the state personnel system pursuant to applicable state and federal laws.
"Employee" means all officers and employees of this state, whether in covered service or uncovered service, unless otherwise prescribed.
"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.
"Original probationary period" means the specified period following initial appointment to covered service.
"Probationary period" means a working test period of employment in a covered service position for evaluation of the employee's work.
"Promotional probation" means the specified period of employment following promotion of a permanent status employee to another covered service position that has a higher pay grade.
"Rules" means rules adopted by the department of administration, human resources division.
"Significant procurement role":

(a) Means any role that includes any of the following duties:

(i) Participating in the development of a procurement as defined in section 41-2503.

(ii) Participating in the development of an evaluation tool.

(iii) Approving a procurement as defined in section 41-2503 or an evaluation tool.

(iv) Soliciting quotes greater than ten thousand dollars for the provision of materials, services or construction.

(v) Serving as a technical advisor or an evaluator who evaluates a procurement as defined in section 41-2503.

(vi) Recommending or selecting a vendor that will provide materials, services or construction to this state.

(vii) Serving as a decision maker or designee on a protest or an appeal by a party regarding an agency procurement selection or decision.

(b) Does not include making decisions on developing specifications and the scope of work for a procurement as defined in section 41-2503 if the decision is based on the application of commonly accepted industry standards or known published standards of the agency as applied to the project, services, goods or materials.

"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.
"State personnel board" means the board established by section 41-781.
"State personnel system" means all state agencies and employees of those agencies that are not exempted by this article.
"State service" means all offices and positions of employment in state government that, before September 29, 2012, were subject to the provisions of articles 5 and 6 of this chapter 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.

(d) Complete a performance evaluation.

"Uncovered employee" means an employee in uncovered service.
"Uncovered service" means employment at will and includes all state employees except those in covered service.

§ 41-742 State personnel system; covered and uncovered employees; application; exemptions

A. Beginning September 29, 2012, unless otherwise prescribed in this article:

All new hires are at will uncovered employees.
Any employee who meets any of the following criteria is an at will uncovered employee:

(a) Is employed as an attorney in a position assigned to the attorney salary schedule.

(b) Is a supervisor.

(c) Is at a pay grade of nineteen or above or, if a successor compensation system is established, in an equivalent pay range as determined by the director.

(d) Is in a position assigned to the information technology salary schedule, in a position assigned to an information technology classification or, if a successor compensation system is established, in an equivalent pay range as determined by the director.

Any covered employee who voluntarily accepts a change in assignment to a position in the uncovered service, regardless of whether the voluntary change in assignment is a promotion, demotion or lateral transfer, is an at will uncovered employee on the start date of the voluntary change in assignment.
A covered employee may voluntarily elect to become an at will uncovered employee without a change in assignment on approval by the state agency head and the director. If approved, the change from covered to uncovered status is immediate.
Once a covered employee becomes an at will uncovered employee, the change is irrevocable.

B. Except as provided in subsection F of this section, the purpose of this article is for all state agencies in the state personnel system to treat employees pursuant to the following principles:

Recruiting, selecting and advancing employees on the basis of the employee's relative ability, knowledge and skills after open competition.
Providing compensation based on merit, performance, job value and competitiveness within applicable labor markets.
Training employees if the training will result in better organizational and individual performance.
Retaining employees on the basis of the adequacy of their performance, correcting inadequate performance where possible and appropriate and separating employees whose performance is inadequate.
Managing applicants and employees in all aspects of personnel administration without regard to political affiliation, race, color, national origin, sex, age, disability or religious creed and with proper regard for their privacy and constitutional rights as citizens.
Ensuring that employees are protected against coercion for partisan political purposes and are prohibited from using their official authority for the purpose of interfering with or affecting the result of an election or nomination for office.

C. The director shall establish and administer the state personnel system, including:

A classification system and job classes and associated knowledge, skills and abilities for those classes.
A centralized job announcement system to streamline statewide recruiting for applicants.
A centralized employment system to be used by all successful applicants, including a common application form to be used by all state agencies.
A compensation system, including assigning pay ranges for all job classes and special pay plans for certain classes or groups of employees considering such factors as occupational patterns, economic conditions and pay plans common to government, business and industry.
A statewide training program.
A statewide performance management system.
An audit function to review state agencies' processes and compliance with applicable statutes, personnel rules and policies.
An integrated system to process personnel, payroll and benefits transactions and serve as the system of record for state employees.

D. This article and articles 5 and 6 of this chapter do not apply to:

An elected state officer. An elected state officer means only elected officials and does not include the employees of elected state officers unless expressly provided.
Members of boards and commissions who are appointed by the legislature or the governor, board members appointed pursuant to section 41-619.52 unless otherwise prescribed by law, employees of the Arizona legislative council, employees appointed or employed by the legislature, any legislative agency or either house of the legislature and employees of the supreme court and the court of appeals.
The Arizona board of regents, officers or employees of state universities and personnel of the Arizona state schools for the deaf and the blind.
Patients or inmates employed in state institutions.
Officers and enlisted personnel of the national guard of Arizona and employees of the department of emergency and military affairs who occupy Arizona national guard positions identified as mobilization assets.
The cotton research and protection council.
The department of public safety.
The Arizona peace officer standards and training board.

E. Unless otherwise prescribed in this article, subsection A, paragraphs 1, 2 and 3 of this section do not apply to either an initial appointment to or changes in assignment to:

An employee of any state agency who is a full authority peace officer as certified by the Arizona peace officer standards and training board.
An employee of the state department of corrections who is employed as a correctional captain, correctional lieutenant, correctional sergeant, correctional corporal, correctional officer I, correctional officer II, correctional officer III, correctional officer IV, community corrections unit supervisor, community corrections group supervisor, community corrections officer or, if a successor classification system is established, an equivalent job class as determined by the director.

F. Subsection B, paragraph 1 of this section, relating to open competition and subsection B, paragraph 4 of this section and subsection B, paragraph 5 of this section, relating to political affiliation, do not apply to:

Employees of the governor's office.
Employees of offices of elected officials who either:

(a) Report directly to the elected official.

(b) Head a primary component or report directly to the head of a primary component of the office of the elected official.

The state agency head and each deputy director, or equivalent, of each state agency and employees of the state agency who report directly to either the state agency head or deputy director.
Each assistant director, or equivalent, of each state agency and employees in the state agency who report directly to an assistant director.
Attorneys in the office of the attorney general.
Employees in investment-related positions in the state retirement system or plans established by title 38, chapter 5, article 2, 3, 4 or 6.

G. This article and articles 5 and 6 of this chapter do not confer any rights in excess of, or in addition to, those previously authorized to any state employee.

H. This article does not create or confer any contractual employment right for any employee and, unless otherwise provided by law, state agencies are prohibited from executing employment contracts with any state employee.

I. Any communications, including policy manuals, employee handbooks, job offers and performance appraisals and other communications as determined by the director, whether in writing or oral, that conflict with article 1, 5 or 6 of this chapter or this article are void and do not alter or supersede article 1, 5 or 6 of this chapter or this article.

§ 41-743 Powers and duties of the director

A. The director is responsible for the direction and control of personnel administration.

B. The director shall:

Employ staff as necessary to perform the duties prescribed by this article.
Establish those offices as the director determines necessary to maintain an effective and efficient program of personnel administration.
Adopt rules and procedures relating to personnel and personnel administration for both covered and uncovered employees. The rules shall include:

(a) The establishment and maintenance of classification and compensation plans.

(b) The recruitment, selection and appointment process of eligible applicants.

(d) Procedures for the periodic and regular review and evaluation of the quality and quantity of work performed by employees.

(e) Changes to employment status.

(f) Procedures for the review of complaints if the complaint contains an allegation of discrimination or harassment.

(g) Procedures requiring review by the director of dismissals, suspensions for more than eighty working hours or involuntary demotions before administering the action.

(h) Grievance rights specific to covered employees.

(i) Appeal rights and other rules specific to covered employees.

(j) Any other aspects of personnel administration as determined by the director.

Provide an annual report and recommendation to the legislature and the joint legislative budget committee as provided in section 41-751.
Establish a mandatory program of personnel management training for all employees with supervisory responsibility that is appropriate to the nature and scope of the employees' responsibilities. The director may waive the mandatory training on a case by case basis. The training shall include at least the following subjects:

(a) Basic employee supervision.

(b) Employee performance evaluations.

(d) Other subjects as the director determines.

Provide consultation to state agency management in all aspects of personnel management to increase efficiency and economy in state agencies by improving the methods of personnel administration with full recognition of the requirements and needs of management.

C. The director may:

Delegate specific personnel functions to a state agency head consistent with legal requirements.
Enter into agreements with any state agency or political subdivision of this state or any agency of a political subdivision of this state to furnish personnel administration services and facilities of the department. Unless monies have been appropriated by the legislature for this purpose, any agreement shall provide for reimbursement to this state of the actual cost of the services and facilities furnished, as determined by the department.
Subject to legislative appropriation, contract for the services of consultants necessary to perform the annual salary plan and salary plan adjustment recommendations.

D. Subsection B, paragraph 3, subdivision (g) of this section relating to review by the director for certain disciplinary actions does not apply to those employees listed in section 41-742, subsection F.

§ 41-744 Nonconformity with federal regulations granting federal monies

Any provision of this article that conflicts or is inconsistent with federal rules, regulations or standards governing the grant of federal monies to any agency or department of this state does not apply to the agency or department. The director may vary or waive the terms of the rules and procedures as applicable to these agencies and departments to comply with the conditions for federal grants.

§ 41-745 Covered and uncovered service

A. Except as provided in subsection C of this section or section 41-742, subsection A, an employee under covered service is entitled to continue to be a covered employee as long as the employee remains in covered status without a break in service or as otherwise provided by law. Probationary status employees are required to complete their probationary period before obtaining rights of appeal. On successfully completing a probationary period, an employee in covered service is entitled to have appeal rights as provided in article 6 of this chapter or section 41-1830.16, as applicable.

B. Except as provided in subsections C and D of this section, uncovered service consists of all employees in the state agencies not included in the covered service. Employees in uncovered service are employees at will and are not entitled to appeal rights.

C. A position that requires certification as a full authority peace officer by the Arizona peace officer standards and training board shall be in the covered and uncovered service as follows:

If, on September 29, 2012, the position is filled with an uncovered employee, the position shall remain in the uncovered service for all future appointments to that position.
If, on September 29, 2012, the position is filled with a covered employee who was in the state service and the employee does not voluntarily elect to become an at will uncovered employee, the position shall remain in the covered service for the current incumbent and for all future appointments to that position.
If, on or after September 29, 2012, an employee in the covered service voluntarily elects to become an at will uncovered employee, the position shall remain in the uncovered service for all future appointments to that position.

D. Beginning on September 14, 2024, a position designated as a correctional captain, correctional lieutenant, correctional sergeant, correctional corporal, correctional officer I, correctional officer II, correctional officer III, correctional officer IV, community corrections unit supervisor, community corrections group supervisor or community corrections officer shall be in the covered service.

§ 41-746 Refusal of consideration for employment; verification of education and work history

A. The director may refuse to consider for employment or remove from consideration for employment any applicant who:

Has practiced any deception or fraud in the applicant's application.
Has failed to reply within a reasonable time to communications concerning the applicant's availability for employment.
Is found to be unsuited or not qualified for employment.
Lacks any of the requirements established by the director for the position for which the applicant applies.

B. The director shall develop procedures and standard forms to be used by all state agencies to verify a candidate's education and work history. The procedures shall include a requirement that a state agency head shall make documented, good faith efforts to contact current and previous employers of a candidate to obtain information and recommendations that may be relevant to the candidate's fitness for employment.

§ 41-747 Employment procedures; violation

A. An appointing authority shall comply with the procedures prescribed in this article and the rules adopted by the director for the recruitment, selection, hiring and separation of employees in the state personnel system. The appointing authority shall prescribe the compensation of an employee at all times pursuant to section 38-611.

B. An appointing authority that violates subsection A of this section and incurs an obligation is subject to the civil and criminal penalties prescribed in title 35, chapter 1.

§ 41-748 Transfer of accumulated annual leave; definitions

A. The director shall adopt procedures for the transfer of accumulated annual leave from one employee to another employee in the same state agency and for transfer of accumulated annual leave from one employee to another state employee in another state agency if the employees are members of the same family. The transfers may occur if the employee to whom the leave is transferred has a seriously incapacitating and extended illness or injury or a seriously incapacitating and extended disability that is caused by pregnancy or childbirth or a member of the employee's immediate family 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 has exhausted all available leave balances. Transferred annual leave shall be increased or reduced proportionally by the difference in the salaries of the employees as determined by department rule. An employee who receives transferred annual leave is limited to using six consecutive months of leave per occurrence unless the employee has applied for long-term disability insurance as provided by rule.

B. For the purposes of this section:

"Immediate family" means an employee's parent, spouse, or child, whether natural, adopted, foster or step.
"Same family" means an employee's 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.

§ 41-749 Administrative leave; reporting

A. A state agency head shall report to the director if an employee is placed on administrative leave with pay during the investigation of alleged wrongdoing by the employee when the employee's administrative leave totals eighty consecutive hours and, thereafter, shall report to the director on a weekly basis until the administrative leave is terminated.

B. A state agency head shall obtain approval from the director if an employee's administrative leave with pay exceeds thirty working days.

§ 41-750 Contribution of pro rata share for personnel division fund

A. All state agencies shall contribute a pro rata share of the overall cost of personnel administration services provided by the department. The pro rata share shall be payable by payroll fund source, and the resultant amount shall be deposited, pursuant to sections 35-146 and 35-147, in a personnel division fund for appropriation by the legislature for the state personnel board, the governor's office of equal opportunity and the personnel division of the department. The pro rata share shall be 0.86 percent of the total payroll of the state agency. Of the 0.86 percent pro rata share, 0.03 percent of total payroll shall be deposited in a separate subaccount of the personnel division fund for use by the state personnel board and is subject to legislative appropriation. Total payroll shall include all fund sources, including the state general fund, federal monies, special revenue funds, intergovernmental revenue monies, trust funds and other payroll fund sources.

B. A claim for the pro rata share percentage payment shall be submitted according to the fund source, with the accompanying payroll to the department for deposit in the personnel division fund.

C. Notwithstanding section 35-190, only monies in excess of five hundred thousand dollars revert to the state general fund at the end of each fiscal year. The state comptroller shall pay any monies determined to be owed to the federal government from the personnel division fund before calculating the reversion.

D. Monies contributed based on the personnel services for individuals employed by the Arizona state retirement system and monies contributed based on the personnel services for individuals employed by the public safety personnel retirement system as the pro rata share shall not revert to the state general fund and shall be separately accounted for and reverted to the Arizona state retirement system, the public safety personnel retirement system, the elected officials retirement plan or the corrections officer retirement plan, as applicable.

§ 41-751 Annual report and recommendations

A. The director shall prepare a report on state personnel and the operation of the state personnel system.

B. The report shall include:

Information concerning all state employees, including employees of all executive, legislative and judicial branch agencies. All state agencies shall provide any information requested by the director to prepare the annual report.
Information concerning turnover, including the number of employees separating from state employment and the reasons for separation.
Information concerning the compensation during the preceding year and the coming year of state employees and the compensation of other public employees and private employees, including the most recent benchmarks established pursuant to section 41-1720.
An advisory recommendation on state employees' salaries. In establishing the recommendation, the director shall consider the relative levels of duties and responsibilities of the various classes of positions, rates paid for comparable positions elsewhere and other relevant factors. Salary recommendations are not required for elected officials. The director shall make advisory salary recommendations for specific positions in the governor's office, the legislature and the courts if requested by the respective administrative heads of these units of state government.
The overtime pay of all state agencies.
Other information as determined by the director.

C. The annual report and recommendations shall be presented to the governor and the legislature on or before September 1 of each year. The director shall provide a copy of the report to the secretary of state.

D. The Arizona board of regents, the department of public safety, the judicial department and the Arizona state schools for the deaf and the blind shall each prepare and submit an annual report on their personnel as prescribed in this section. The report shall include:

Information concerning the number of employees affected by and reasons for turnover of their employees.
Information concerning the compensation during the preceding year and the coming year of their employees and the compensation of other public employees and private employees.
An advisory recommendation on the salary plan and adjustments for their employees. In establishing the salary plan, they shall consider the relative levels of duties and responsibilities of the various classes of positions, rates paid for comparable positions elsewhere and other relevant factors.
The overtime pay for their employees.

§ 41-752 Protections of civil or political liberties; prohibitions; civil penalty; violation; classification

A. Except for expressing an opinion or pursuant to section 16-402, an employee shall not engage in any activities permitted by this section while on duty, while in uniform or at public expense.

B. An employee shall not:

Use any political endorsement in connection with any appointment to a position in the state personnel system.
Use or promise to use any official authority or influence for the purpose of influencing the vote or political action of any person or for any consideration.

C. An employee, a member of the state personnel board or a member of the law enforcement merit system council shall not be a member of any national, state or local committee of a political party, an officer or chairperson of a committee of a partisan political club or a candidate for nomination or election to any paid public office, shall not hold any paid, elective public office or shall not take any part in the management or affairs of any political party or in the management of any partisan or nonpartisan campaign or recall effort, except that any employee may:

Express an opinion.
Attend meetings for the purpose of becoming informed concerning the candidates for public office and the political issues.
Cast a vote and sign nomination or recall petitions.
Make contributions to candidates, political parties or campaign committees contributing to candidates or advocating the election or defeat of candidates.
Circulate candidate nomination petitions or recall petitions.
Engage in activities to advocate the election or defeat of any candidate.
Solicit or encourage contributions to be made directly to candidates or campaign committees contributing to candidates or advocating the election or defeat of candidates.

D. A person shall not:

Solicit any employee, member of the state personnel board or member of the law enforcement merit system council to engage or not engage in activities permitted by this section with the direct or indirect use of any threat, intimidation or coercion, including threats of discrimination, reprisal, force or any other adverse consequence, including the loss of any benefit, reward, promotion, advancement or compensation.
Subject any employee, member of the state personnel board or member of the law enforcement merit system council engaging in activity permitted by this section to any direct or indirect discrimination, reprisal, force, coercion or intimidation or any other adverse consequence, including the loss of any benefit, reward, promotion, advancement or compensation.
Subject any employee, member of the state personnel board or member of the law enforcement merit system council who chooses not to engage in any activity permitted by this section to any direct or indirect discrimination, reprisal, force, coercion or intimidation or any other adverse consequence, including the loss of any benefit, reward, promotion, advancement or compensation.

E. Subsections B and C of this section do not apply to those employees listed in section 41-742, subsection F.

F. This section does not apply to school board elections or community college district governing board elections, and an employee may serve as a member of the governing board of a common or high school district, as a member of a community college district governing board or in the office of precinct committeeman.

G. An employee who violates any of the provisions of this section is subject to suspension of not less than thirty days or dismissal.

H. A person who violates:

Subsection D of this section is guilty of a class 6 felony.
Any other provision of this section is guilty of a class 1 misdemeanor.

I. In addition to any other penalty, any person soliciting or encouraging a contribution in a manner prohibited by this section is subject to a civil penalty of up to three times the amount of the contribution solicited or encouraged plus costs, expenses and reasonable attorney fees.

J. This section does not deny any employee or board member any civil or political liberties as guaranteed by the United States and Arizona Constitutions.

K. It is the public policy of this state, reflected in this section, that government programs be administered in an unbiased manner and without favoritism for or against any political party or group or any member in order to promote public confidence in government, governmental integrity and the efficient delivery of governmental services and to ensure that all employees are free from any express or implied requirement or any political or other pressure of any kind to engage or not engage in any activity permitted by this section. Toward this end, any person or entity charged with the interpretation of this section shall take into account the policy of this section and shall construe any of its provisions accordingly.

§ 41-753 Unlawful acts; violation; classification

A. A person shall not make any false statement, certificate, mark, rating or report with regard to any test, certification or appointment made under this article or in any manner commit any fraud preventing the impartial execution of this article or rules adopted under this article.

B. A person shall not, directly or indirectly, give, render, pay, offer, solicit or accept any money, service or other valuable consideration for or on account of any appointment, proposed appointment, promotion or proposed promotion to, or any advantage in, a position in the state personnel system.

C. An employee of any state agency, examiner or other person shall not obstruct any person in the person's right to examination, eligibility, certification or appointment under this article, or furnish to any person any special or secret information for the purpose of affecting the rights or prospects of any person with respect to employment in the state personnel system.

D. An employee of any agency as defined in section 41-1001, including the office of the governor, who has a significant role in the procurement of materials, services or construction shall not accept an offer of employment from or have employment discussions with any person or entity lobbying for or potentially responding to a solicitation during a period beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending at the time of the contract award. An employee of any agency as defined in section 41-1001, including the office of the governor, who has a significant role in the procurement of materials, services or construction shall not accept an offer of employment from or have employment discussions with the successful offeror or offerors and their lobbyists during a period beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending one year after the purchased materials are delivered or the purchase of services or construction begins. The director of the department of administration may waive any or all of the waiting period in excess of twenty-four months for a procurement officer or an employee with a significant procurement role if the period of time that follows the signature of the nondisclosure agreement exceeds twenty-four months. A procurement officer or an employee seeking a waiver shall make a written request to the officer's or employee's state agency director, and the director of the state agency shall forward the request with a written recommendation to the director of the department of administration. The director of the department of administration shall provide a written decision and justification within fifteen business days after the receipt of the complete request. The director of the department of administration may not approve waiver requests for matters still in evaluation or within six months following the contract award. If the requesting party is the director or a deputy director of a state agency, the request for a waiver and all written materials, including a director recommendation, must be forwarded to the governor for a final decision, except that the director may not make any recommendation or determination on the director's own request. An agency as defined in section 41-1001, including the office of the governor, shall inform its employees when the first nondisclosure agreement is signed on a particular solicitation, and the agency shall notify the state procurement administrator who shall post information regarding the date of the first nondisclosure agreement pertaining to a particular procurement activity on the department of administration's website. This subsection does not apply to a procurement officer or an employee who in good faith relies on a determination issued by the director pursuant to section 41-2517, subsection D that the procurement officer or employee has not had a significant procurement role.

E. Any person who knowingly violates subsection A, B, C or D of this section is guilty of a class 2 misdemeanor.

F. An elected or appointed official shall not with corrupt intent use the official's political influence or position to cause the firing, promotion or demotion of any public employee or the hiring of or failure to hire any applicant for public employment.

G. An elected or appointed official who knowingly and with corrupt intent violates subsection F of this section is guilty of a class 2 misdemeanor.

H. Any person who is convicted of a class 2 misdemeanor under this article, for a period of five years, is ineligible for appointment to or employment in a position in the state personnel system and, if the person is an employee of this state at the time of conviction, is subject to suspension for not less than ninety days or dismissal.

I. A contact by an elected or appointed official with a public agency regarding the qualifications of an applicant shall not be construed as illegally using political influence or position.

§ 41-754 Required reduction in hours

An agency director may require an agency employee to work reduced hours in order to comply with any reduction in appropriations. The director shall prescribe procedures to implement these reductions.

Article 5 Covered Service

§ 41-771 Powers and duties of director relating to employees in covered service

The director shall adopt rules and procedures that are applicable only to employees in covered service. The rules and procedures shall provide for:

The continuation of a probationary period for probationary employees.
A minimum period of original probationary service following the initial appointment of a full authority peace officer as certified by the Arizona peace officer standards and training board or the initial appointment of a correctional captain, correctional lieutenant, correctional sergeant, correctional corporal, correctional officer I, correctional officer II, correctional officer III, correctional officer IV, community corrections unit supervisor, community corrections group supervisor or community corrections officer. During an original probationary period, the probationary employee shall perform the actual duties of the position and may be discharged without cause. The director shall establish a period of promotional probation service.
Disciplinary action to be taken against an employee only if cause exists.
Reduction in force by reason of lack of monies or work, abolition of a position or a material change in duties or organization as provided in section 41-772.
The continuation of the same annual leave accrual rate and the maximum number of annual leave hours that may carry over into a new calendar year as an uncovered employee for an employee of the state department of corrections who is employed on September 14, 2024 as a correctional captain, correctional lieutenant, correctional sergeant, correctional corporal, correctional officer IV, community corrections unit supervisor or community corrections group supervisor.

§ 41-772 Reduction in force procedure in covered service

A. The director shall establish reduction in force procedures to be used by all state agencies if reductions are required in covered service by reason of lack of monies or work, abolition of a position, a material change in duty or organization or the introduction of other cost reduction initiatives.

B. The procedures shall use the person's performance record as the sole basis for determining retention. Consideration of the person's performance is limited to performance, as measured by up to the three most recent performance evaluations conducted using a performance measurement system approved by the director, during a period of not more than the two years immediately preceding the reduction in force. Notwithstanding any other statute, a state agency shall not adopt policies that provide employment retention priority for employees based on tenure or seniority.

C. The procedures shall provide for a reduction in force to be limited to a single agency or organizational unit of an agency or an organizational unit of agency operations within a geographic area.

D. The procedures shall provide for an expedited review of any determinations made during a reduction in force.

§ 41-773 Causes for dismissal or discipline for employee in covered service

A. Each of the following constitutes cause for discipline or dismissal of an employee in covered service:

Fraud or misrepresentation in securing appointment.
Incompetency.
Inefficiency.
Neglect of duty.
Insubordination.
Dishonesty.
Being impaired by alcohol or drugs while on duty.
Illegal use or illegal possession of a narcotic or habit-forming drug.
Unauthorized absence or absence without leave.
Commission of any crime classified as a felony or involving moral turpitude.
Discourteous treatment of the public or other employees.
Improper political activity.
Wilful disobedience.
Misuse or unauthorized use of state property.

B. In addition to the causes prescribed by subsection A of this section, the director may establish other causes deemed necessary.

C. The director shall prescribe definitions for each of the causes for dismissal or discipline prescribed or established under this section that shall be used by covered employees and, as applicable, the state personnel board or the law enforcement merit system council in evaluating dismissals and disciplinary actions.

Article 6 State Personnel Board

§ 41-781 State personnel board; members; appointment; term; meetings; compensation

A. The state personnel board consists of five members appointed by the governor pursuant to section 38-211. No more than three members shall belong to the same political party. Persons eligible for appointment shall have had a continuous recorded registration pursuant to title 16, chapter 1 with either the same political party or as an independent for at least two years immediately preceding appointment. Of the members appointed one shall be a person who for more than five years has managed a component or unit of government or industry with more than twenty employees, one shall be a professional personnel administrator, one a state employee, one a person active in business management and one a member of the public. Members may be removed by the governor for cause. The chairperson of the state personnel board shall serve as an ex officio member of the law enforcement merit system council established by section 41-1830.11 without voting privileges.

B. The term of office for each member is three years, each term to expire three years from the date of appointment. On the expiration of the term of a member a successor shall be appointed for a full term of three years.

C. The state personnel board may hold regular monthly meetings and, in addition, may hold special meetings the board deems necessary. A chairperson and vice chairperson shall be elected by the members at the first meeting of each year and the chairperson shall not serve successive terms as chairperson. Meetings of the state personnel board shall be open to the public, and executive sessions may be held as provided by law.

D. Any one of the following constitutes the resignation of a board member and authorizes the governor to appoint a new member to fill the unexpired term so vacated:

Becoming a candidate for any elective public office.
Accepting any appointive office or employment in the state personnel system, except the state employee who is designated to serve on the board.

E. Members of the state personnel board, except the person designated as the state employee, are eligible to receive compensation of one hundred dollars for each meeting attended, prorated for partial days for each meeting attended. The member of the state personnel board designated as the state employee shall be paid the state employee's regular compensation for meetings of the board.

§ 41-782 Powers and duties of the state personnel board

A. Except as provided by section 41-1830.16, the state personnel board shall hear and review appeals as provided in this article relating to dismissal of a covered employee from covered service, suspension for more than eighty working hours or involuntary demotion resulting from disciplinary action as defined in the personnel rules for an employee in covered service.

B. The state personnel board shall hear and review complaints as provided in title 38, chapter 3, article 9, relating to any personnel action taken against an employee or former employee of this state, except an employee or former employee of a state university or the board of regents, which the employee or former employee believes was taken in reprisal for the employee's or former employee's disclosure of information to a public body. The state personnel board shall recommend the dismissal of a supervisor or other responsible person, other than an elected official, who it determines committed a prohibited personnel practice.

C. The state personnel board may adopt rules it deems necessary for the administration of hearings and the review of appeals and complaints as prescribed in this section.

D. The state personnel board shall only exercise authority that is specifically granted to the board pursuant to this article.

§ 41-783 Appeals to the state personnel board for covered employees; notice of charges; hearings

A. Except as provided by section 41-1830.16, a covered employee who has completed the covered employee's original probationary period of service as provided by the personnel rules may appeal to the state personnel board the covered employee's dismissal from covered service, suspension for more than eighty working hours or involuntary demotion resulting from disciplinary action. The appeal shall be filed not later than ten working days after the effective date of such action. The covered employee shall be furnished with specified charges in writing when the action is taken. Such appeal shall be in writing and must state specific facts relating directly to the charges on which the appeal is based and shall be heard by the state personnel board within sixty days after its receipt. The state personnel board shall provide the employing agency with a copy of the appeal not less than twenty days in advance of the hearing.

B. Hearings on such appeals shall be open to the public, except in cases where the covered employee requests a confidential hearing, and shall be informal with technical rules of evidence not applying to the proceedings except the rule of privilege recognized by law. Both the covered employee and the employing agency shall be notified of the initial hearing date not less than twenty days in advance of the hearing and not less than ten days in advance of a board meeting. The covered employee and the employing agency may select representatives of their choosing, present and cross-examine witnesses and give evidence at the hearing. The state personnel board may appoint a hearing officer to conduct the hearing and take evidence on behalf of the board and exercise the rights prescribed by section 12-2212. The state personnel board shall prepare an official record of the hearing, including all testimony recorded manually or by mechanical device, and exhibits. Either party may request that the record be transcribed. If a party requests that the record be transcribed, an entity, other than the state personnel board, selected by the requesting party shall transcribe the record at the cost of the requesting party. If the disciplinary hearing would involve evidence the state is prevented by law from disclosing, then a confidential hearing upon the state's request shall be granted.

C. The state personnel board:

Shall determine whether the state agency has proven by a preponderance of the evidence the material facts on which the discipline was based. On such a finding, the board shall affirm the decision of the state agency head, unless the disciplinary decision was arbitrary and capricious.
May recommend modification of a disciplinary action if the agency has not proven by a preponderance of the evidence the material facts on which the discipline was based or if a disciplinary decision is found to be arbitrary and capricious.
Shall reverse the decision of the state agency head if the board finds that cause did not exist for any discipline to be imposed and, in the case of dismissal or demotion, return the covered employee to the same position the employee held before the dismissal or demotion with or without back pay.

D. On a finding that the agency has not proven by a preponderance of the evidence the material facts on which the discipline was based, the board shall identify the material facts that the board found were not supported by a preponderance of the evidence and may recommend a proposed disciplinary action in light of the facts proven. On a finding that the disciplinary decision was arbitrary and capricious, the board shall include the board's reasons for the board's finding and may recommend a proposed disciplinary action in light of the facts proven.

E. Within forty-five days after the conclusion of the hearing, the state personnel board shall enter its decision or recommendation and shall at the same time send a copy of the decision or recommendation by certified mail to the employing agency and to the covered employee at the employee's address as given at the hearing or to a representative designated by the covered employee to receive a copy of the decision or recommendation. The agency director or the director's designee shall accept, modify or reverse the board's decision or accept, modify or reject the board's recommendation within fourteen days of receipt of the findings or recommendation from the state personnel board. The decision of the agency director or director's designee is final and binding. The agency director shall send a copy of the agency's final determination to the covered employee pursuant to this section.

F. Any party may appeal the decision of the state personnel board or the final decision of the agency pursuant to title 12, chapter 7, article 6 to the superior court in the covered employee's county of residence on one or more of the following grounds that the order was:

Founded on or contained error of law that shall specifically include error of construction or application of any pertinent rules.
Unsupported by any evidence as disclosed by the entire record.
Materially affected by unlawful procedure.
Based on a violation of any constitutional provision.
Arbitrary or capricious.

G. An appeal shall be available to the court of appeals from the order of the superior court pursuant to title 12, chapter 7, article 6 as in other civil cases.

H. A covered employee may represent himself or designate a representative, not necessarily an attorney, before any board hearing or any quasi-judicial hearing held pursuant to this section providing that no fee may be charged for any services rendered in connection with such hearing by any such designated representative who is not an attorney admitted to practice.

Article 7 Management of State Properties

§ 41-790 Definitions

In this article, unless the context otherwise requires:

"Building renewal" means major activities that involve the repair or reworking of a building and the supporting infrastructure that will result in maintaining a building's expected useful life. Building renewal does not include new building additions, new infrastructure additions, landscaping and area beautification, routine preventive maintenance except as provided in section 41-793.01, subsection D or demolition and removal of a building.
"Building system" means a group of buildings that together constitute a single unit for purposes of planning, land acquisition, construction or building renewal.
"Capital projects" means buildings, structures, facilities and areas constructed for the use or benefit of this state.
"Infrastructure" means nonbuilding improvements that directly support operating a facility that is listed in the annual building system such as utility delivery systems, roadway systems, external lighting systems, irrigation systems, sidewalks and parking lots.
"Land acquisition" means the procurement of real property by gift, grant, purchase, lease purchase, condemnation or other lawful means.
"Security" means security services related to building operation and maintenance functions provided by the department.
"State capitol building" means:

(a) The original 1898 statehouse known as the state capitol museum.

(b) The 1919 state capitol wing and the 1938 state capitol justice addition known jointly as the legislative services wing.

(d) The senate wing.

(e) The west wing known as the state capitol executive tower.

§ 41-790.01 Exemptions; exception

A. The following are exempt from the provisions of this article relating to capital improvement plans:

Land acquisition, capital projects or building renewal by any state agency if the total cost of the entire acquisition, project or building renewal will not exceed twenty-five thousand dollars.
Programs, projects or improvements of the state transportation board relating to the construction, reconstruction, improvement or maintenance of state highways or bridges.

B. Land acquisition, capital projects and building renewal relating to buildings which serve as offices for the department of transportation are not exempt.

§ 41-791 Powers and duties relating to public buildings maintenance; compensation of personnel

A. The department is responsible for the direction and control of public buildings maintenance as prescribed in this article.

B. The department is responsible for the allocation of space, operation, alteration, renovation and security of the following buildings:

The state capitol executive tower of the state capitol building.
The state office buildings in Tucson.
The state office buildings located at:

(a) 701 East Jefferson street in Phoenix.

(b) 801 East Jefferson street in Phoenix.

(d) 1030 North 32nd street in Phoenix.

All other buildings owned or leased by the state and located near the state capitol building and the state office buildings in Tucson, except for:

(a) Buildings occupied, operated and maintained by the following state agencies:

(i) The department of transportation.

(ii) The Arizona power authority.

(b) The state capitol museum, the legislative services wing, the house of representatives and senate wings of the state capitol building and the building located at 1716 West Adams street in Phoenix.

(c) The department of economic security facilities purchased with federal funding assistance and exclusively and continuously operated and maintained for the department's own occupancy.

(d) The Arizona courts building.

(e) The mining, mineral and natural resources educational museum.

C. The department is responsible for the maintenance of the following buildings and grounds:

The entire state capitol building and the grounds adjacent to it.
The state office buildings in Tucson and the grounds adjacent to them.
Other buildings and grounds owned or leased by the state if the function is not otherwise assigned, except for the interior of the Arizona courts building.

D. The director may establish rules for the operation, maintenance and security of buildings and grounds under the director's jurisdiction.

E. The department shall:

Employ engineers and maintenance and operations personnel as required, including a buildings manager for the state office buildings in Tucson.
Determine the hours of duty and assignment of personnel.

F. All personnel employed under this article are eligible to receive compensation as determined under section 38-611.

§ 41-791.01 Powers and duties relating to facilities planning and construction; exemption

A. The department has the following facilities planning and construction powers and duties:

Review all architectural, engineering and construction contracts before submission to the department of law.
Approve plans and specifications and changes thereof for all capital projects for which monies are appropriated by the legislature.
Review and approve all progress payments on all major capital projects.
Make regular inspections of all capital projects during the course of construction to ensure compliance with the plans and specifications approved by the director.

B. The Arizona board of regents shall not be subject to the provisions of this section.

§ 41-791.02 Powers and duties relating to acquiring property; lease purchase agreements; eminent domain; JLBC approval

A. The director may acquire, in the name of this state, by gift, grant, purchase, lease purchase, condemnation or any other lawful manner, real property, buildings, energy systems or energy management systems that are necessary, useful or convenient for the use of this state, but no land or building may be acquired by purchase or condemnation without prior approval of the joint committee on capital review and an appropriation of monies by the legislature for such an acquisition.

B. Any lease purchase agreement relating to land acquisition, capital projects, energy systems or energy management systems under this section shall provide that:

The obligation of this state to make any payment under the agreement is a current expense of the department, payable exclusively from appropriated monies, and is not a general obligation indebtedness of this state or the department.
If the legislature fails to appropriate monies or the department fails to allocate such monies for any periodic payment or renewal term of the agreement, the agreement terminates at the end of the current term and this state and the department are relieved of any subsequent obligation under the agreement.
The agreement be reviewed and approved by the attorney general before the agreement may take effect.
The agreement be reviewed and approved by the joint committee on capital review before the agreement takes effect.

C. The department may covenant to use its best efforts to budget, obtain, allocate and maintain sufficient appropriated monies to make payments under a lease purchase agreement, but the agreement shall acknowledge that appropriating state monies is a legislative act and is beyond the control of the department or of any other party to the agreement.

D. A lease purchase agreement under this section shall be submitted to the attorney general to review for compliance with the constitution and laws of this state. If in the attorney general's opinion the agreement so complies, the attorney general shall certify the agreement, return it to the department and transmit a copy to the joint committee on capital review. On request by the director, the attorney general may give other opinions relating to the agreement.

E. A lease purchase agreement under this section shall be reviewed and approved by the joint committee on capital review before the agreement takes effect.

F. The director may lease any property owned by this state at fair rental value, or on other terms and conditions if the lessee is a political subdivision of this state. If the property was purchased through the capital outlay stabilization fund as set forth in section 41-792.01, subsection A, the net income received from any such lease shall be credited to the capital outlay stabilization fund. All other lease net incomes shall be credited to the state general fund.

G. The director, with the consent of the governor, may lease property that is acquired under this article for public purposes and convey in the name of this state easements for roadways, walkways and utility purposes on any of the real property acquired under this article.

H. If the power of eminent domain is exercised, it shall be exercised as provided in sections 12-1111 through 12-1128.

I. The amount paid for any property purchased by the department, except such property as may be acquired by condemnation and property acquired in any manner within the governmental mall composed of the area described in section 41-1362, shall not exceed the appraised value as fixed by an appraiser, to be appointed by the director, who is a well-qualified appraiser and a designated member of a nationally recognized real estate appraisal association, institute or society. If the department orders only one appraisal of the property, the property owner may request, and the department shall provide, a second appraisal. Each appraisal ordered by the department for a property shall be conducted by a different firm. If more than one appraisal is conducted, the director may use either appraisal in determining the appraised value affixed by the appraiser. A contract for appraisal services shall be awarded in accordance with chapter 23 of this title. Before the property within the governmental mall is acquired as provided in this subsection, the joint committee on capital review shall review and approve the purchase of the property.

J. The director may dispose of real property acquired by the department or any right, title or other interest in such property if the director determines that it is no longer needed or used for state purposes. The director, after the establishment, laying out or substantial completion of an improvement to such real property, may convey the real property or any interest in the real property that the director determines is not necessary, useful or convenient for the use of such an improvement by this state. The conveyance shall be made to the highest and most responsible bidder at a public sale held for that purpose.

K. Before entering into any contract or agreement with a city or regional public transportation authority regarding the placement of a light rail station in the governmental mall, the director shall submit the contract or agreement to the joint legislative budget committee for approval. The committee shall approve or reject the contract or agreement not more than one hundred twenty days after the submission.

§ 41-791.04 Lease purchase financing; eligible municipal convention center projects; eligible projects lease purchase fund

A. On the filing of a notice by an eligible city with the director pursuant to section 9-624 requesting this state to lease purchase part of an eligible municipal convention center project, the director may complete lease purchase financing of the part of the eligible project designated by the eligible city. The director may employ outside consultants to review the lease purchase program request and report on the financial details of the program negotiated with the eligible city. The eligible city is responsible for the costs of the consultant and the report. The lease purchase agreement shall include the provisions required by section 41-791.02, subsection B and the provisions authorized by section 41-791.02, subsection C. The agreement is subject to the review provisions of section 41-791.02, subsections D and E. At the director’s request, the attorney general may give other opinions relating to the agreement.

B. The lease purchase financing agreement shall provide for:

The use, maintenance and operation of the eligible project by the eligible city and for the ownership of the eligible project by the eligible city on completion of performance of the lease purchase agreement.
The eligible city’s option to purchase the eligible project and on exercising the option, the vesting of ownership of the eligible project in the eligible city on discharging the lease purchase agreement.

C. Except as provided in subsection E of this section, the annual lease payment under the lease purchase agreement shall not exceed the amount that would otherwise have been distributable to the eligible city pursuant to section 9-602 if the notice pursuant to section 9-624 had not been filed.

D. An eligible projects lease purchase fund is established consisting of monies appropriated by the legislature for lease purchase agreement payments pursuant to this section. The director shall administer the fund and distribute monies in the fund to make payments pursuant to lease purchase agreements entered into by the director pursuant to this section and to pay costs considered to be necessary by the director and the eligible city in connection with lease purchase transactions entered into pursuant to this section. Payments pursuant to a lease purchase agreement shall be made only from the eligible projects lease purchase fund. The state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. At the request of an eligible city, the director may complete lease purchase financing for all or any part of the eligible project, except that if the annual lease payment of this state exceeds the amounts that would otherwise have been distributable to the eligible city for the eligible project, all such excess amounts shall be paid from monies provided by the eligible city.

§ 41-792 Lease cost review board; members; duties; square footage lease costs

A. A lease cost review board is established. Board membership consists of the director or the director's designee and four members appointed by the director, as follows:

Three directors of other state agencies.
A staff member of the joint legislative budget committee.

B. The term of office of appointed members is three years. A director of a state agency may appoint an employee of the agency to serve on the committee in the director's stead.

C. Before July 1 of each even-numbered year, the lease cost review board shall:

Estimate an average square foot dollar cost for the following two fiscal years for leasing privately owned office space.
Recommend to the director a rental rate to be charged to state agencies for using space in buildings owned by or leased to this state.

D. Leases proposed to be entered into by a state agency for privately owned office space must be approved by the director, or in the case of the state universities, by the Arizona board of regents. Before August 1 of each even-numbered year, the director and the board shall each submit a report to the joint committee on capital review that lists all leases that were approved during the prior two fiscal years and that exceeded the average square foot dollar cost estimated for the prior fiscal year pursuant to subsection C.

§ 41-792.01 Capital outlay stabilization fund; authorization for collection of rental; basis of payment; report; distribution of monies collected; transfer of payment; lease-purchase building operating and maintenance fund; definition

A. The capital outlay stabilization fund is established which shall consist of monies paid into it in accordance with subsections D and F of this section and legislative appropriations to the account. All monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. The director shall make a recommendation for the allocation of a varying sum to the capital outlay stabilization fund each year. No part of the fund may be expended without specific appropriation from the legislature.

C. Each state department and each state agency when using space under the jurisdiction of the department as prescribed in section 41-791 or when using space in a building leased to the state shall pay rental and tenant improvement labor costs as prescribed in subsection D, E or F of this section.

D. The rental rates authorized for agencies occupying state-owned buildings shall be determined by the joint committee on capital review after recommendation by the director before July 1 of each even-numbered year. The rental is payable whether the state department or state agency is funded in whole or in part by state monies. The department of administration shall transfer the entire amount of the rental fee assessed on a state agency from the agency account into the capital outlay stabilization fund promptly at the start of each fiscal year. During the remainder of the fiscal year, the department of administration shall calculate pro rata adjustments to the rental fee on a monthly basis to reflect any changes in the occupancy of state-owned buildings. The department of administration shall transfer the amount of the rental fee adjustment assessed on a state agency from the agency account into the capital outlay stabilization fund. The rental fee authorized for state agencies occupying state-owned buildings is the greater of the amount included in each agency's annual operating budget as reported by the staff of the joint legislative budget committee or the pro rata adjusted amount based on actual occupancy. The director of the department of administration may authorize an exemption for periods of one year or more at a time for a state agency from the full payment account transfer requirements of this subsection if the agency can demonstrate a practice of making full payment of rent on a different basis necessitated by its cash flow. If a state agency does not have the financial resources for state-owned space, or does not occupy or vacates state-owned space after the beginning of the fiscal year, the director of the department of administration may authorize a whole or partial exemption from payment of the rental fee. On or before June 30 of each year, the department of administration shall submit a report to the staff of the joint legislative budget committee that details all rental fee exemptions authorized in the prior year.

E. The rental authorized for state agencies occupying state-leased buildings shall be the greater of the amount included in each agency's annual operating budget as reported by the staff of the joint legislative budget committee or the pro rata adjusted amount based on actual occupancy. The rental amount shall include the amount necessary to pay the lease or lease-purchase obligation and may include the amount necessary to pay operating costs associated with the lease-purchase buildings. The rental is payable whether the state department or state agency is funded in whole or in part by state monies. At the start of each fiscal year, the department of administration shall transfer the entire amount of the rental fee assessed on a state agency from the agency account into the department of administration's funds established for the purposes of this subsection. The department shall transfer from the applicable state agency budgets to the lease-purchase building operating and maintenance fund established in subsection I of this section amounts necessary to pay all operating costs associated with a lease-purchase building in the amounts reported by the staff of the joint legislative budget committee. During the remainder of the fiscal year, the department of administration shall calculate pro rata adjustments to the rental fee on a monthly basis to reflect any changes in the occupancy of state-leased buildings. The director of the department of administration may authorize an exemption for a state agency from the full payment account transfer requirements of this subsection for one-year periods or longer periods if the agency can demonstrate a practice of making full payment of rent on a different basis necessitated by its cash flow. If a state agency does not have the financial resources for state-leased space, or does not occupy or vacates state-leased space after the beginning of the fiscal year, the director of the department of administration may authorize a whole or partial exemption from payment of the rental fee. Before authorizing a rental fee exemption, the department of administration shall report the proposed rental fee exemption to the staff of the joint legislative budget committee.

F. The department of administration shall charge state agencies for the full costs of labor services it provides to accomplish tenant improvement projects within a building owned by or leased to the state. Charges for this labor shall be deposited in the capital outlay stabilization fund.

G. State universities, community colleges and the department of transportation are exempt from the provisions of this section, except when these state agencies are using space under the jurisdiction of the department of administration.

H. The department of administration shall not begin to charge rental or tenant improvement labor costs as prescribed in subsection D, E or F of this section until July 1, 2012 for any buildings operated by the secretary of state primarily for the purpose of storing, managing or preserving a large amount of public records or archival material.

I. The lease-purchase building operating and maintenance fund is established consisting of monies transferred into it in accordance with subsection E of this section. All monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations. Monies in the fund are subject to legislative appropriation.

J. For the purposes of this section, buildings leased by this state through the sale and lease-back deficit financing mechanism are considered state-owned buildings. State-leased buildings that are subject to subsection E of this section and that meet the requirements of section 41-791, subsection B are subject to subsection D of this section in the fiscal year following the retirement of the lease or lease-purchase debt service financing. On or before September 1 of each year, the department of administration shall report to the joint legislative budget committee and the governor's office of strategic planning and budgeting on the cost associated with charging rental rates to state agencies with retired leases or lease purchases for the next fiscal year.

K. For the purposes of this section, "state department" or "state agency" means any department or agency of the executive or judicial branch of state government.

§ 41-792.02 Capitol mall consolidation fund; use; review

A. The capitol mall consolidation fund is established consisting of monies appropriated by the legislature. The department shall administer the fund. Monies in the fund are subject to legislative appropriation and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies in the fund shall be used for building renewal and renovations of state-owned buildings.

C. Before spending monies in the fund, the director shall submit an expenditure plan for review by the joint committee on capital review.

§ 41-793 Building systems; capital improvement plans

A. The department of administration, the Arizona board of regents and the department of transportation shall each be considered as a separate building system. Subject to approval by the joint committee on capital review, the director of the department of administration shall establish additional building systems for the purpose of computing and funding building renewal. Subject to approval by the joint committee on capital review, each building system shall designate an agency that is responsible for computing building renewal needs for each fiscal year pursuant to the formula approved by the committee and for allocating appropriated building renewal monies within the building system.

B. The agency responsible for each building system established pursuant to subsection A of this section shall prepare each year a capital improvement plan that contains proposals for state spending on land acquisition, capital projects, energy systems, energy management systems and building renewal for the building system. Copies of the plan shall be submitted to the governor no later than October 15. Each plan shall include:

A detailed list of all land acquisition and capital projects that are recommended to be undertaken or continued for the building system during the next fiscal year, an explanation as to the need for each acquisition or project, the effect of the recommended acquisition or capital project on the future operating expenses of this state, recommendations as to the priority of recommended acquisitions or capital projects and the means of financing those acquisitions or projects.
Forecasts as to the requirements for land acquisition and capital projects for the building system during the two fiscal years following the fiscal year provided for in paragraph 1 of this subsection and for any additional periods as may be necessary or desirable for an adequate presentation of the capital projects and a schedule for the planning and implementation or construction of those capital projects.
A report on the status of all ongoing or recently completed land acquisitions and capital projects for the building system, with a summary of monies expended for each acquisition or project.
A report on the condition, maintenance and utilization of all buildings within the building system that were inspected during the prior fiscal year.
A report on the building renewal activities undertaken during the past fiscal year, including the specific purposes for which monies were expended, proposed activities for the current fiscal year and a prioritized schedule of renewal projects proposed for the following fiscal year.
The amount of appropriation required in the following fiscal year for building renewal as determined by the building renewal formula set forth in section 41-793.01.

C. On or before June 1 of each year or thirty days after the state legislature adjourns its regular session sine die, whichever is later, each state agency under the department of administration building system and not later than August 1 of each year each agency under the Arizona board of regents building system shall provide to the agency responsible for its building system:

A detailed list of land acquisition and capital projects the agency seeks to undertake or continue in the next fiscal year, an explanation as to the need for each acquisition or project, the effect of the acquisitions or capital projects on future operating expenses of this state, including energy systems and energy management systems, and other relevant supporting data requested by the agency responsible for the building system.
Forecasts as to the requirements for land acquisition or capital projects of the agency for the two fiscal years following the fiscal year provided for in paragraph 1 of this subsection and for any additional periods as may be necessary or desirable for the adequate presentation of the capital projects and a schedule for the planning and implementation or construction of those capital projects.
A report on all ongoing or recently completed land acquisitions and capital projects of the agency, with a summary of monies expended for each acquisition or project, and energy consumption and expenditure information.
Any other information requested by the agency responsible for the building system.
A separate list that contains the status of all of its projects reviewed by, approved by or reported to the joint committee on capital review that have not yet been completed. The projects listed shall include third-party and commercial projects reported or reviewed pursuant to section 15-1682.02.

D. Each state agency in complying with subsection C, paragraph 1 of this section and the agency responsible for each building system in complying with subsection B, paragraph 1 of this section should give priority to fire and life safety projects.

E. The agency responsible for a building system shall inspect the condition, maintenance and utilization of each building within the building system not less than once every four fiscal years and shall report its findings pursuant to subsection B of this section. For purposes of complying with this requirement, the agency responsible for each building system shall inspect approximately fifty percent of its buildings within the first two years of the four-year cycle. The agency shall inspect the other fifty percent of the buildings in the remaining two years of the four-year cycle.

F. The governor shall prescribe standard forms in accordance with this section to be used by state agencies in preparing and submitting capital improvement plans. The forms prescribed shall be constructed so as to allow each building system to adequately provide information pertinent to its manner of operation.

G. Each plan, forecast and report required for two or more fiscal years in this section shall be delineated separately for each year.

§ 41-793.01 Formula for building renewal monies; legislative appropriations

A. The joint committee on capital review shall develop and approve a uniform formula for computing annual funding needs of building systems for building renewal. In developing a formula, the committee shall take into consideration at least the following factors:

The current replacement value of buildings, including structures capitalized as part of the original cost of the buildings.
The original construction cost of buildings, including structures capitalized as part of the original cost of the buildings.
The current age of buildings.
The expected useful life of buildings, including any extraordinary use or functions of the building.

B. In developing a building renewal formula pursuant to subsection A of this section, the committee shall develop and approve a uniform format for all building systems for the collection of data required by the building renewal formula.

C. The amount computed pursuant to this section for building renewal for each building system shall be incorporated into the capital improvement plan required pursuant to section 41-793.

D. The agency responsible for a building system shall allocate and expend the amounts appropriated for building renewal within the building system. The department may use up to eight per cent of the amount appropriated for routine preventive maintenance.

E. Notwithstanding this section or any other law, monies that are appropriated or available for building renewal may be spent for state building modifications to comply with the federal Americans with disabilities act of 1990 (42 United States Code sections 12101 through 12213 and 47 United States Code sections 225 and 611).

§ 41-793.02 Renovation or replacement of state buildings; building life extension study; definition

A. To ensure that proper consideration is given to economically effective options for extending the life of an existing building, the agency responsible for each building system that is established pursuant to section 41-793, subsection A may support each request for funding of the renovation and shall support each request for funding of the replacement of a building with a floor area greater than twenty-five thousand square feet with a building life extension study.

B. The building life extension study shall calculate:

The current service life of the building by considering:

(a) The design life of the major components of the building.

(b) The installed cost of the major components.

The cost of extending the service life by five, ten and twenty-five years respectively.

C. The agency shall compare the calculations with the proposed cost and extended service life of the proposed renovated or replaced building.

D. For the purposes of this section, "major component" includes the following elements of a building:

Foundation.
Roofing.
Interior construction.
Plumbing.
Electrical systems.
Heating and cooling systems.

§ 41-794 State agencies; capital projects; reports; exception

Within thirty days after the last day of each calendar quarter, each state agency shall submit to the joint legislative budget committee staff and the governor's office of strategic planning and budgeting a report on the status of all capital projects and capital expenditures for which monies were appropriated to the state agency, except that the department of transportation is not required to submit reports pursuant to this section for highway construction projects.

§ 41-796 Regulation of traffic and parking; monetary penalties; hearing; state traffic and parking control fund; definition

A. The department of administration may adopt and administratively enforce rules for the control of vehicles on state property with respect only to the following:

Maximum speed of vehicles.
Direction of travel.
Place, method and time of parking.
Nonparking areas.
Designation of special parking areas for state employees and the general public.
Prohibiting parking in vehicle emissions control areas as defined in section 49-541 of those vehicles which fail to comply with section 49-542.

B. The department shall adopt and administratively enforce rules requiring the designation of preferential parking areas, such as reserved, close-in or covered parking, to state employees with offices in vehicle emissions control areas as defined in section 49-541 who are car pool operators as defined in section 28-4032 or who drive vehicles powered by alternative fuel as defined in section 1-215.

C. The department may prescribe and collect reasonable monetary penalties for violations of the rules adopted pursuant to subsection A of this section.

D. The department shall:

Cause signs, markings and notices to be posted on the property for the regulation of vehicles.
Maintain parking lots and structures.

E. On the failure of a person who is issued a citation for a violation of a rule adopted pursuant to this section to appear, the administrative law judge may proceed to determine whether a violation has occurred and, if so, the penalty to be imposed.

F. Penalties that are imposed pursuant to this section and that are not paid within the time prescribed by the administrative law judge may be collected by an action filed with the justice court.

G. A state traffic and parking control fund is established consisting of monetary penalties collected pursuant to this section. The department shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

H. All monetary penalties collected by the department for violations of the rules adopted pursuant to subsection A of this section shall be deposited in the state traffic and parking control fund.

I. Except as provided in section 41-1092.08, subsection H, a person who has received a final administrative ruling concerning a penalty imposed on the person as a result of a violation of a rule adopted pursuant to this section may have that ruling reviewed by the superior court in the county in which the institution involved is located pursuant to title 12, chapter 7, article 6.

J. For the purposes of this section, "state property" means property that is the responsibility of the department under section 41-791 and property that is the responsibility of the speaker of the house of representatives or the president of the senate under section 41-1304.05.

§ 41-796.01 Adjusted work hours

The director by rule shall require adjusted work hours for at least eighty-five per cent of state employees with offices located in area A or area B as defined in section 49-541 each year beginning October 1 and ending April 1 in order to reduce the level of carbon monoxide concentrations caused by vehicular travel.

§ 41-797 Department of corrections building renewal fund

A. The department of corrections building renewal fund is established consisting of monies deposited pursuant to section 31-230, section 41-1604, subsection B, paragraph 3, sections 41-1604.02, 41-1604.03 and 41-1624 and section 41-1641, subsection E. The director of the state department of corrections shall administer the fund. Monies in the fund are subject to legislative appropriation and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. The director of the state department of corrections shall use the monies in the fund for building renewal projects that repair or rework buildings and supporting infrastructure that are under the control of the state department of corrections and that result in maintaining a building's expected useful life. Monies in the fund may not be used for new building additions, new infrastructure additions, landscaping and area beautification, demolition and removal of a building and, except as provided in subsection C of this section, routine preventive maintenance.

C. The director of the state department of corrections may use up to eight per cent of the annual expenditures from the fund for routine preventive maintenance.

§ 41-805 Off duty peace officers; lease or rental of law enforcement equipment

A. Subject to the agreement of the director of the department of administration, the head of a state department or agency that employs peace officers who are certified by the Arizona peace officer standards and training board established by section 41-1821 may allow those peace officers to engage in off duty law enforcement work if that work does not conflict with the work performed by the certified peace officers for the state department or agency.

B. If the head of a state department or agency allows its certified peace officers to engage in off duty law enforcement work pursuant to subsection A of this section, the state department or agency may lease or rent motor vehicles and other law enforcement equipment directly to its certified peace officers for the purpose of traffic safety, traffic control or other law enforcement related activity.

C. If a state agency or department leases or rents motor vehicles pursuant to subsection B of this section, the state agency or department shall:

Adopt rules and policies relating to the lease or rental of motor vehicles and other law enforcement equipment that are substantially similar to the rules and policies adopted by the department of public safety.
Deposit, pursuant to sections 35-146 and 35-147, any monies generated from leasing or renting the state fleet motor vehicles in the department of public safety administration fund.

D. The department of administration shall adopt uniform contract indemnity provisions and insurance coverage provisions naming this state and the agency that allows its certified peace officers to engage in off duty law enforcement work as additional insureds on a commercial liability policy. The coverage policy applies to all employers of certified peace officers engaging in off duty law enforcement work pursuant to this section. The coverage policy shall hold this state harmless and indemnify this state by employers of certified peace officers engaging in off duty law enforcement work.

§ 41-806 Use of renewable energy; department of administration facilities; definitions

A. If the cost of renewable energy is not more than five per cent higher than the cost of traditional power, the department of administration shall meet the following minimum requirements for use of renewable energy to provide power to the department's facilities in the governmental mall:

On or before January 1, 2003, one per cent.
On or before January 1, 2004, two per cent.
On or before January 1, 2005, three per cent.
On or before January 1, 2010, ten per cent.

B. For the purposes of this section:

"Governmental mall" means the governmental mall described in section 41-1362.
"Renewable energy" includes solar energy, geothermal energy, wind energy and biomass energy.

Chapter 4.1 History, Archaeology and State Emblems

Article 1 Arizona Historical Society

§ 41-821 Arizona historical society; powers; officers; duties of board of directors

A. The Arizona historical society is established.

B. Subject to limitations imposed by law, the society may purchase, receive, hold, lease and sell property, real and personal, for the benefit of this state and use of the society. The society may solicit private monetary donations for program activities.

C. The society shall have a president, a treasurer and other officers who are elected by the members of the society at times and by methods the bylaws of the society prescribe. Each member of the board of directors shall have knowledge, competence, experience and interest in the fields related to the preservation and promotion of Arizona history and be a member of the society or become a member of the society before senate confirmation. The governor shall appoint the members pursuant to section 38-211 for a term of four years. The board of directors may designate from among its members an executive committee with authority to act in place of the board of directors and in accordance with directions the board of directors may give when the board of directors is not in session.

D. The board of directors is established consisting of the following members who are appointed pursuant to subsection C of this section:

One member from each county.
One member who is recommended by each of the designated historical organizations as prescribed by subsection I of this section.
Five members of the public.

E. The president shall preside at meetings of the society and of the board of directors. Each member of the board of directors is entitled to only one vote. The board of directors may conduct meetings telephonically.

F. The treasurer shall have custody of the monies of the society, other than legislative appropriations. The treasurer shall hold the monies of the society deposited in trust for the society's use and for the benefit of this state and shall disburse them only as prescribed by law and the bylaws of the society.

G. The board of directors shall hold in trust for this state and administer for the benefit of this state and use of the society all property acquired by the society.

H. All expenditures of legislative appropriations to the society shall be made on claims that are duly itemized, verified and approved by the executive director of the society. The executive director of the society shall present and file claims for payment with the director of the department of administration. The director of the department of administration shall draw the warrant on the state treasurer. The society may expend nonappropriated private funds related to program activities.

I. The board of directors shall annually designate one or more historical organizations within each county of this state that are incorporated as nonprofit organizations and that are deemed to have a functioning program of historical value based on criteria established by the board of directors. The board of directors may organize chapters made up of groups of its members who have a common interest in a geographical area of this state or a common interest in a field of history, may provide for the governance of these chapters and may grant to any chapter the power to exercise authority of the society as the board of directors may determine.

J. The board of directors, subject to legislative appropriation, may contract with certified historical organizations for services to be performed for the benefit of this state. The contracts shall be prepared by the Arizona historical society. The board of directors shall annually review the contracts to ensure fulfillment of their provisions.

K. Subject to chapter 4, article 4 of this title, the board of directors may employ an executive director and may employ or authorize the employment of other employees it considers appropriate to carry out the functions of the society. The executive director and all other employees shall have duties and exercise authority as may be prescribed by the board of directors or by the executive director acting under the direction of the board of directors.

L. The board may operate a program for the establishment and maintenance of historical markers at various locations in this state.

§ 41-822 Historical collections; annual report

A. The board of directors shall annually make a detailed statement of expenditures to the governor.

B. To enable the society to augment its collections by effecting exchanges with other societies and institutions, sixty bound copies of each of the several publications of the state and its societies and institutions, except reports of the supreme court, shall be donated to the society when issued, and shall be delivered to the society by the officer having their custody. There shall also be donated to the society for deposit in its collections one set of all publications of the state, including the supreme court reports.

§ 41-823 Purposes of society; housing of society collection; financial provisions

A. The society shall procure, by gift, exchange or purchase:

Books, maps, papers and materials pertaining to the history of Arizona and the west.
Narratives of historical events of the exploration and early settlement of Arizona, and of overland travel in the state and the west.
Data relating to Indian tribes, and portraying the antiquities, the past and present conditions and progress of the state.
Historical and scientific reports of the western states, and materials and facilities for investigation of historical, scientific, social, educational and literary subjects.

B. The collections and materials shall be housed suitably for protection, preservation and availability, properly catalogued and kept accessible to the public during reasonable hours on business days and the society may charge a fee for these services.

C. For the purpose of effectuating the functions prescribed in subsections A and B of this section, the society may borrow money with which to erect or procure needed buildings and equipment, but authorization to borrow money shall not exceed in the aggregate the sum of seventy-five thousand dollars for the purpose of erecting and procuring needed buildings and equipment. The society may issue negotiable promissory notes and necessary renewal notes as evidence of the money so borrowed. The notes shall be authorized by resolution of the board of directors of the society, may mature at such times not exceeding three years from the respective dates thereof, may bear interest at not to exceed five per cent per annum, payable semiannually, and may be payable at such times and in such partial sums as the resolution provides.

D. Money borrowed under the provisions of this section shall be deposited, pursuant to sections 35-146 and 35-147, in the Arizona historical society building fund and disbursed in satisfaction of approved claims arising under the contract or contracts for construction and equipment of the building.

E. Notes issued pursuant to this section shall be payable only in accordance with the terms thereof and shall not be obligations, general, special or otherwise, of the state. The notes shall not constitute a debt, legal or moral, of the state and shall not be enforceable against the state.

§ 41-824 Journal of Arizona history

The Arizona historical society shall publish a magazine, to be known as "Journal of Arizona History", at least four times per year.

§ 41-825 Permanent Arizona historical society preservation and restoration revolving fund

A. There is created the permanent Arizona historical society preservation and restoration revolving fund in the amount of five thousand dollars for use in copying, preserving and restoring historic photographs and negatives, which are proper as ultimate claims for payment from state funds. Such expenditures from the fund and reimbursement thereto shall be as prescribed by rules and regulations of the department of administration.

B. The permanent revolving fund shall be established as a separate account on the books of the Arizona historical society and a full accounting of its use shall be made to the department of administration annually or as required by the department of administration.

C. All monies deposited in the revolving fund are appropriated to the Arizona historical society for use as provided in this section and shall be exempt from the provisions of section 35-190, relating to lapsing of appropriations.

§ 41-826 Permanent Arizona historical society revolving fund

A. The permanent Arizona historical society revolving fund is established consisting of both of the following:

All monies received by the society from operating gift shops, book shops and food service facilities and from charges for the use of or admission into any of the society's facilities and deposited, pursuant to sections 35-146 and 35-147, in the fund.
Gifts, grants, donations and contributions to the fund.

B. Fund monies shall be spent by the society for both of the following:

Enhancing the programs of the society or operating or improving its facilities.
Issuing historical markers for a dude ranch that is designated for inclusion in the Arizona dude ranch heritage trail program established by section 41-867.

C. The Arizona historical society shall prepare an annual report that accounts for all permanent Arizona historical society monies received, from where received and for what purposes the monies were used during the fiscal year. The report shall include plans for the ensuing fiscal year. The report shall be presented to the legislature during January of each year.

D. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

E. All monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

Article 2 Prescott Historical Society of Arizona

§ 41-831 Prescott historical society of Arizona; organization; officers; election by membership; property held in trust; expenditure of legislative appropriations

A. There shall be a Prescott historical society of Arizona which, subject to the limitations imposed by law, may purchase, receive, hold, lease and sell property, real and personal, for the benefit of the state and the use of the society.

B. The society shall have a president, a vice-president, a secretary, a treasurer and other officers as determined by the board of trustees. The president shall preside at meetings of the society and of the board of trustees.

C. The members of the board of trustees shall be elected by the members of the society. The board of trustees shall consist of fifteen members of the society who reside in this state.

D. The treasurer shall have custody of the funds of the society other than legislative appropriations. He shall hold the funds of the Sharlot Hall historical society coming into his hands in trust for the use of the Sharlot Hall historical society and for the benefit of the state and shall disburse them only as prescribed by law and according to the bylaws of the society.

E. The board of trustees shall hold in trust for the state and administer for the benefit of the state and use of the society all property acquired by the society.

F. All expenditures of legislative appropriations to the society shall be made upon claims duly itemized, verified and approved by the board which shall be presented and filed with the director of the department of administration who shall draw his warrant therefor.

§ 41-832 Meetings of society; nominations; bylaws of society; election of officers; meetings; rules and regulations; employment of director and other personnel

A. The society shall meet annually on the first Monday of June at the call of the president for the purpose of nominating new members of the board of trustees and to conduct such other business as may properly come before it. The nominations shall be made by a nominating committee chosen by the members of the society. Members of the board of trustees shall serve for a term of three years.

B. The society may adopt bylaws for its government.

C. The board of trustees shall elect annually from its membership a president, vice president, secretary and a treasurer.

D. Regular meetings of the board of trustees shall be held at least once during each calendar quarter. Special meetings may be held at the call of the president or upon petition of any three of its members. Members of the board of trustees shall receive no compensation but shall be reimbursed for subsistence and travel expenses incurred in the performance of their duties as provided for other state officers.

E. The board of trustees shall adopt rules and regulations for the administration of the work of the society and for carrying out the provisions of this article. The rules and regulations may divide membership of the society in four classes named life, one year, associate and honorary and may define each class. The fees for each class shall be fixed by the board of trustees, provided that the fee for any class may not exceed twenty-five dollars per annum.

F. The board of trustees may employ, subject to chapter 4, article 4 of this title, a director, assistant director, custodians, archivists, librarians, researchers, maintenance personnel, gardeners or other necessary personnel, define their duties and fix their compensation pursuant to section 38-611 and within the limits of legislative appropriation. The board may also employ the services of professional consultants on a fee basis within the limits of legislative appropriation.

§ 41-833 Powers and duties of society

A. The Prescott historical society shall:

Preserve, maintain and perpetuate the gubernatorial mansion, the Sharlot Hall Museum and the historical collections contained in the mansion and museum and on the grounds of the mansion and museum in Prescott, Arizona.
Procure by gift, exchange or purchase books, maps, papers, goods, artifacts, utensils, museum specimens and other data or materials pertaining to the history of Arizona and the west.
Conduct and carry on investigations and expeditions into the geological and anthropological life of Arizona and the west.
Establish and maintain a library and publish pamphlets and reports.
Exchange exhibits on a temporary basis for display purposes with other museums and societies.
Loan exhibits to schools in Arizona or to museums and societies for which a fee may be charged.
Suitably house for protection, preservation and availability and properly catalogue and keep accessible to the public, during reasonable hours, the historical collections and materials and may charge a fee for these services.
Keep accessible to the public all historical data and provide suitable space for its use in research and may charge a fee for these services.

B. All monies received by the society from whatever source other than legislative appropriation shall be credited for the use of the Sharlot Hall historical society and used as provided by the terms of this subsection for the following purposes:

Acquisition and restoration of museum specimens.
Direct research pertaining to the history of Arizona and the west.
Publication of books, pamphlets, bulletins and reports for sale by the society.
Acquisition of postal cards or other items consistent with the objects of the society for resale.
Other necessary expenses.

C. The board of trustees may establish and collect fees for pamphlets, books, bulletins or reports which they publish, for items acquired for resale or for exhibits loaned to other museums or societies.

D. The board of trustees shall annually make a report of its activities and expenditures to the governor.

§ 41-834 Fees

Any fees collected for annual membership or collections for any other purpose shall be deposited with the treasurer and expended as provided by the terms of this article and the rules and regulations of the society.

Article 3 Historic Names

§ 41-835 Perpetuation of historical names

It is declared the public policy of this state that natural or artificial objects, places or things continue to be known by the names they now bear, as determined by the state geographic and historic names board, so that the historical record of the state may be protected and preserved.

§ 41-835.01 Definitions

In this article, unless the context otherwise requires:

"Board" means the state board on geographic and historic names.
"Geographic features" means mountains, canyons, gulches, streams, streambeds or channels whether flowing or dry, natural bridges, natural lakes, natural monuments, mesas, deserts, forests, springs, water holes, cliffs, chasms and other similar natural objects, places or things.
"Historic road" means a highway, street, road or route that is of historical or cultural significance in the settlement and development of this state and that is established or designated as a historic road by the board.
"Parkway" means an area along either or both sides of a highway, street, road or route that is acquired in fee or by easement by the governmental body having jurisdiction over the highway, street, road or route for the protection of geographic, natural flora or scenic values and that is established or designated as a parkway by the board.
"Places of historical significance" or "historic place" means objects, places or things that are associated with or named after people, places or events of historical significance, including historic roads, scenic roads, parkways, artificial bridges, dams, artificial lakes, parks, mining districts, artificial monuments, roads, trails or other similar artificial objects, places or things.
"Scenic road" means a highway, street, road or route through a scenic area that is established or designated as a scenic road by the board.

§ 41-835.02 State board on geographic and historic names; membership; expenses; quorum; staff support; chairperson

A. The state board on geographic and historic names is established consisting of:

One member who is appointed by the head of each of the following agencies or organizations:

(a) The department of transportation.

(b) The state land department.

(d) The Arizona historical society.

(e) The Arizona commerce authority.

(f) The department of economic security.

(g) A geography department of an Arizona university.

Three members of the public who are appointed by the governor, at least one of whom is an enrolled member of a recognized tribe or Indian community located in Arizona.

B. Members shall serve staggered five-year terms to begin and end on the third Monday in January, except that the member appointed pursuant to subsection A, paragraph 1, subdivision (g) of this section shall serve a two-year term. The initial appointment of the member appointed in subsection A, paragraph 1, subdivision (g) of this section shall be made by Arizona state university. On the expiration of the initial term of the member appointed in subsection A, paragraph 1, subdivision (g) of this section, the position shall be appointed by the university of Arizona, and on the expiration of that term northern Arizona university shall appoint the member. The three state universities shall continue to rotate the appointment of this member on the board.

C. Members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

D. The Arizona state library, archives and public records shall provide staff support to the board.

E. A majority of the members constitutes a quorum.

F. The board shall annually elect a chairperson and vice chairperson from among its members.

§ 41-835.03 Powers and duties

A. The board shall:

Receive and evaluate all proposals for changes in or additions to names of geographic features and places of historical significance in this state and after this evaluation designate the most appropriate and acceptable names and spelling of these names for use in maps and other official governmental documents.
Receive and evaluate all proposals for naming geographic features in this state for which no generally accepted name is or has been in use and after this evaluation designate a name for use in maps and other official governmental documents.
Cooperate with political subdivisions of this state to eliminate the duplication of the names of geographic features that are not of historical significance.
Assist and cooperate with the United States board of geographic names in matters relating to names of geographic features and places in this state.
Maintain a list of advisers who have expertise in this state's history, geography or culture and consult with those advisers in evaluating proposals.
Designate one or more members to act as the state representative to the western states geographic names council.
Receive and evaluate all proposals to establish or designate a highway or area as a parkway, historic road or scenic road that is of geographic or historical significance in this state and after this evaluation designate the most appropriate and acceptable names and spelling of these names for use in maps and other official governmental documents. If the parkway, historic road or scenic road to be established or designated is not a state highway or route, the establishment or designation is not effective unless the state board on geographic and historic names or governmental body having jurisdiction over the parkway, historic road or scenic road agrees to the establishment or designation. The state board on geographic and historic names shall notify the director of the department of transportation and the state transportation board when a parkway, historic road or scenic road is given a historic designation pursuant to this section.

B. The board may:

Adopt rules for the orderly conduct of business.
Initiate proposals for changes in or additions to geographic or historic names in this state. Any proposal initiated by the board shall be evaluated in accordance with the procedures prescribed under section 41-835.04.

C. Notwithstanding any other law, the board may not:

Change street and road names for the purpose of uniformity.
Designate a name for a geographic feature that commemorates any person until that person has been deceased at least five years.

§ 41-835.04 Changes in or additions of geographic features or places of historical significance; submission of proposal; consideration; action; notice

A. A person, a group or an agency of federal, state or local government may propose a change in or the addition of any geographic feature or place of historical significance within this state by submitting a proposal and supporting information to the board for evaluation and recommendation.

B. On receipt of a proposal, together with sufficient supporting information, the board shall:

Place the proposal on the agenda for consideration at its next meeting.
Give appropriate notice to persons and groups that are affected by the proposal or might have an interest in it.
Provide opportunities for public comment.
Conduct research and field investigations as it deems necessary.

C. When the board takes action on a proposal, the board shall notify the person, group or agency that submitted the proposal and shall transmit the official recommendation of geographic names to the United States board of geographic names. The names approved by the board shall be filed with the secretary of state and the clerk of the board of supervisors in the appropriate county.

§ 41-835.05 Use of names chosen

When the board designates a name for a geographic feature or place of historical significance within this state, the name is the official name for the geographic feature or historic place and shall be used in and on all maps, records, documents and other publications issued by this state or its departments and political subdivisions.

§ 41-835.06 Advertising or publishing a name without approval

A person may not attempt to modify local usage or name an unnamed geographic feature in an advertisement or publication without first obtaining the approval of the board. If a person violates this section, the board shall promptly act to curtail such activity and shall adopt an official name for the feature if no recognized name is of record.

§ 41-836 Restriction on changing historical name

It is unlawful for a public officer, department, agency or employee to change and record in writing or otherwise in any public records, documents or papers of this state the name of a place of historical significance or mountain, canyon, gulch, stream, streambed or channel, whether flowing or dry, mesa, desert, forest, spring, water hole, bridge, either natural or artificial, cliff, chasm, dam, lake, either natural or artificial, park, mining district, monument, either natural or artificial, road, trail or other natural or artificial geographic feature in this state unless the change has first been approved by the board.

§ 41-837 Hoover dam

A. Notwithstanding this article, the dam located on the Colorado river in Mohave county, formerly known as Boulder Dam, is designated and shall be known as "Hoover Dam".

B. All official acts, state records, documents and papers relating thereto executed after June 30, 1953 shall bear the designation "Hoover Dam".

§ 41-837.01 Mogollon Rim

A. Notwithstanding this article, the cliff-like escarpment located in northern Arizona which separates the Colorado plateau and the central highlands and forms, in part, the divide between the Little Colorado river and Salt River drainage areas, also forming a portion of the boundaries of Coconino and Gila counties, is designated and shall be known as the "Mogollon Rim". The escarpment begins at approximately 34° 25' 10" north 111° 33' 00" west and continues through approximately 34° 18' 00" north 110° 54' 15" west then continues through approximately 34° 14' 00" north 110° 18' 9" west and ends at approximately 34° 7' 15" north 109° 58' 30" west, such point being approximately two miles south of Pinetop-Lakeside at the head of Petrified Creek.

B. All official acts, state records, documents and papers relating to the escarpment described in subsection A of this section after April 4, 1984 shall bear the designation "Mogollon Rim".

C. The first letter of both words of the designation "Mogollon Rim" shall be capitalized in accordance with standard practice for geographic names.

§ 41-838 Violation; classification

A person who violates any provision of this article or who directs a violation of this article is guilty of a class 2 misdemeanor.

Article 4 Archaeological Discoveries

§ 41-841 Archaeological and vertebrate paleontological discoveries

A. On lands owned or controlled by this state or any agency of this state a person shall not knowingly excavate in or upon any historic or prehistoric ruin, burial ground, archaeological or vertebrate paleontological site, or site including fossilized footprints, inscriptions made by human agency or any other archaeological, paleontological or historical feature, except when acting as a duly authorized agent of an institution or corporation referred to in section 41-842.

B. On lands owned or controlled by this state or any agency of this state a person shall not knowingly collect any archaeological specimen or vertebrate paleontological specimen without obtaining a permit authorizing the activity as provided under section 41-842. For the purpose of this subsection, "archaeological specimen" means any item resulting from past human life or activities which is at least one hundred years old including petroglyphs, pictographs, paintings, pottery, tools, ornaments, jewelry, textiles, ceremonial objects, weapons, armaments, vessels, ships, vehicles and human skeletal remains. Archaeological specimen does not include arrowheads, coins or bottles.

§ 41-842 Permits to explore

A. Only institutions, organizations or corporations organized for scientific, research or land use planning purposes may pursue any activity prescribed in section 41-841.

B. No such activity may be undertaken until a permit is first secured therefor from the director of the Arizona state museum.

C. Permits shall be granted by the director for such periods of time and under such regulations as he may from time to time determine to institutions, organizations or corporations which are qualified to conduct such activities and which shall undertake to propagate the knowledge to be gained and to preserve permanently all objects, photographs and records in public repositories under their own supervision or control, or the supervision or control of other similar institutions, organizations or corporations.

§ 41-843 Prohibiting unnecessary defacing of site or object

No person, institution or corporation shall deface or otherwise alter any site or object embraced within the terms of sections 41-841 and 41-842, except in the course of activities pursued under the authority of a permit granted by the director of the Arizona state museum.

§ 41-844 Duty to report discoveries; disposition of discoveries; definitions

A. A person in charge of any survey, excavation, construction or other like activity on any lands owned or controlled by this state, by any public agency or institution of the state, or by any county or municipal corporation within the state shall report promptly to the director of the Arizona state museum the existence of any archaeological, paleontological or historical site or object that is at least fifty years old and that is discovered in the course of such survey, excavation, construction or other like activity and, in consultation with the director, shall immediately take all reasonable steps to secure and maintain its preservation. If it is necessary to move the object before completion of the proceedings prescribed by this section to permit the continuation of work on a construction project or similar project, the director shall require that the move be accomplished in the manner that will least disturb and best preserve the object.

B. If the objects discovered are human remains, funerary objects, sacred ceremonial objects or objects of national or tribal patrimony, the director of the Arizona state museum, to the best of the director's ability, shall give notice of the discovery to:

All individuals who may have a direct kinship relationship to the human remains.
All groups that it is reasonable to believe may have a cultural or religious affinity to the remains or objects.
Appropriate members of the curatorial staff of the Arizona state museum.
Faculty members of the state universities who have a significant scholarly interest in the remains or objects.
The state historic preservation officer.

C. American Indian tribal governments that wish to be notified pursuant to this section shall keep on file with the director lists of the cultural groups and geographical area with which they claim affinity.

D. If American Indian human remains, funerary objects, sacred ceremonial objects or objects of cultural patrimony are involved, the director, in addition to giving notice as required in subsection B of this section, shall give notice to the tribes that occupy or have occupied the land on which the discovery is made and to the governor's office on tribal relations and the intertribal council of Arizona.

E. The director shall respond to every report of a discovery in a timely fashion and within six months after being notified of the discovery, the director shall convene a meeting of notified persons and representatives of notified groups to discuss the most appropriate disposition of the discovered materials. At this meeting, the director shall encourage agreement among all participants regarding the most appropriate disposition and treatment of the materials. An agreement may include a decision to curate or rebury materials subject to conditions or limitations, a decision to engage in scientific analysis before repatriation or reburial or any other appropriate disposition. If an agreement is reached, it shall determine the disposition and treatment of the materials and the director shall oversee its implementation.

F. If no agreement is reached within six months after the meeting required by subsection E of this section, the human remains or funerary objects shall be disposed and treated in accordance with the wishes of the nearest relative with a direct kinship relationship, or with the wishes of the governing body of the group with cultural or religious affinity to the remains or objects if no relative exists. If sacred ceremonial objects or objects of national or tribal patrimony are concerned, disposition and treatment shall be in accordance with the wishes of the governing body of the group with cultural or religious affinity to the objects. The authority to determine the disposition and treatment of remains or objects pursuant to this subsection shall not be exercised in a manner that would prevent timely completion of a construction project or other project.

G. If there is no person with a direct kinship relationship or a group with a cultural or religious affinity to human remains or funerary objects and the remains have no scientific value, the remains or funerary objects shall remain undisturbed. If it is necessary to move them in order to permit completion of a construction or similar project, the remains or funerary objects shall be reburied under the supervision of the director in a place as similar and close as possible to their original burial site. If the remains or funerary objects have scientific value, they may be curated by the Arizona state museum or other authorized repository for a period of one year, after which they shall be reinterred. If remains of American Indians are involved, reburial pursuant to this subsection shall be undertaken with the cooperation of the Indian tribe located nearest to the place where the remains were discovered. Reburial, with that tribe's consent, may take place on that tribe's reservation. The one-year period for scientific curation may be extended with that tribe's consent. If there is no group with a cultural or religious affinity to sacred ceremonial objects or objects of national or tribal patrimony, the director shall decide on the most appropriate disposition and treatment. Where American Indian materials are involved, the determination shall be made in consultation with appropriate tribal representatives.

H. A repository charged with the care or custody of human remains, funerary objects, sacred ceremonial objects or objects of national or tribal patrimony pursuant to this section shall maintain them with appropriate dignity and respect and with consideration for the specific applicable cultural or religious traditions applicable to the remains or objects. When materials are returned to relatives or affiliated groups, the relatives or groups shall accept and undertake responsibility for the protection and security of the materials.

I. The expense of any curation or reburial pursuant to this section that is required as the result of a construction project or similar project shall be borne by that project. Reburials made in order to satisfy the wishes of a relative or affinal group shall be by and at the expense of the relative or group.

J. If a person believes that the provisions of this section have not been properly applied the person shall give written notice of this claim to all other parties entitled to notice under subsections B and C of this section. The parties shall meet within fifteen days after receiving the notice and attempt to agree on the designation of a third party to assist in the resolution of the dispute. If the parties cannot agree within fifteen days on a third party, the state historic preservation officer shall serve in that capacity. The adverse parties shall attempt to reach a resolution with the assistance of the third party. If a resolution cannot be reached within ninety days after the designation of the third party, the third party shall resolve the dispute. Either party may appeal a decision within thirty days to the superior court in the county in which the subject of the dispute is located.

K. If a written request for the reburial or repatriation of human remains, funerary objects, sacred ceremonial objects or objects of national or tribal patrimony in the possession and ownership or control of an agency of this state, as of September 27, 1990, is made by the government of an American Indian tribe, the requirements of this section apply as if the remains or objects had been discovered after September 27, 1990.

L. Whenever two or more groups or tribes have affinity to the same human remains, funerary object, sacred ceremonial object or object of national or tribal patrimony and they do not agree on the disposition or treatment of such remains or object, the question of which group or tribe shall be deemed to have affinity shall be resolved pursuant to subsection J of this section. In making the determination, consideration shall be given to all the relevant evidence of affinity.

M. For the purposes of this section:

"Funerary object" means an object discovered in proximity to human remains and intentionally buried or interred with the remains.
"Group with a cultural or religious affinity" means any of the following:

(a) In the case of human remains or funerary objects, any tribe that has submitted a written claim of affinity pursuant to subsection C of this section or any other group or tribe that has cultural affinity in light of all the relevant evidence.

(b) In the case of a sacred ceremonial object, a group whose religious observances traditionally have utilized such object.

(c) In the case of an object of national or tribal patrimony, a group whose past or present government or traditional cultural organization was or is associated with the object.

"Group" includes American Indian tribes.
"Human remains" means any remains of a human being who died more than fifty years before the remains are discovered.
"Objects of national or tribal patrimony" means inalienable items of historical or cultural significance to tribal groups.
"Sacred ceremonial object" means an object traditionally utilized in religious observances.
"Tribe" means any federally recognized tribal government.

§ 41-845 Unlawful reproduction of original archaeological specimen

No person shall reproduce, retouch, rework or forge any archaeological, paleontological or historical object, deriving its principal value from its antiquity, or make any object, whether copied or not, or falsely label, describe, identify or offer for sale or exchange any object, with intent to represent the same to be an original and genuine archaeological, paleontological or historical specimen, nor shall any person offer for sale or exchange any object with knowledge that it has previously been collected or excavated in violation of any of the terms of this article.

§ 41-846 Violation; classification

Except as otherwise provided in section 13-3702.01, any person, institution or corporation violating any provision of this article is guilty of a class 2 misdemeanor and shall forfeit to the Arizona state museum all articles and material discovered, collected, excavated or offered for sale or exchange, together with all photographs and records relating to such objects.

Article 5 State Emblems

§ 41-851 State colors; state flag

A. Blue and old gold shall be the colors of the state. The blue shall be the same shade as that of the flag of the United States.

B. The flag of the state shall be of the following design:

The lower half of the flag a blue field and the upper half divided into thirteen equal segments or rays which shall start at the center on the lower line and continue to the edges of the flag, colored alternately light yellow and red, consisting of six yellow and seven red rays. In the center of the flag, superimposed, there shall be a copper-colored five pointed star, so placed that the upper points shall be one foot from the top of the flag and the lower points one foot from the bottom of the flag. The red and blue shall be the same shade as the colors in the flag of the United States. The flag shall have a four-foot hoist and a six-foot fly, with a two-foot star and the same proportions shall be observed for flags of other sizes.

C. The flag represents the copper star of Arizona rising from a blue field in the face of a setting sun.

§ 41-852 Display of state flag; death of incumbent elective state officer; display of United States flag and Constitution and the Bill of Rights

A. The state flag shall be displayed alongside the flag of the United States on or in front of the state capitol building, and institutional and educational buildings of the state as the governor directs, on or in front of the courthouse of each county, and other institutional buildings of each county as the board of supervisors directs, and on or in front of the city or town hall of each incorporated city or town, and other municipally owned buildings as the governing body of the municipality directs.

B. On the death of an incumbent elective state officer, each state flag displayed pursuant to subsection A shall be flown at half-staff for a period of seven days beginning on the day following the death of the officer.

C. The flag of the United States shall be displayed in each hearing room in the state house of representatives and state senate in accordance with title 4 of the United States Code and a legible copy of the Constitution of the United States and the Bill of Rights shall be displayed adjacent to the flag.

§ 41-853 State fossil

Petrified wood, or araucarioxylon arizonicum, is the official state fossil.

§ 41-854 State bird

The cactus wren, otherwise known as Coues' cactus wren or heleodytes brunneicapillus couesi (Sharpe) shall be the state bird.

§ 41-855 State flower

The pure white waxy flower of the cereus giganteus (giant cactus) or Saguaro shall be the state flower.

§ 41-856 State tree

The Palo Verde (genera cercidium) shall be the state tree.

§ 41-857 State neckwear

The Bola tie shall be the official state neckwear.

§ 41-858 State gemstone

Turquoise is the official state gemstone.

§ 41-859 State animals

The ringtail or bassariscus astutus, the Arizona ridgenose rattlesnake or crotalus willardi, the Arizona trout or salmo apache and the Arizona tree frog or hyla eximia shall be known respectively as the state mammal, reptile, fish and amphibian.

§ 41-860 State butterfly

A. The papilionidae papilio multicaudata, two-tailed swallowtail is the official state butterfly.

B. Designation of the state butterfly pursuant to this section shall not constitute grounds for protection of the butterfly or its habitat.

§ 41-860.01 State nickname

"The Grand Canyon state" is the official state nickname.

§ 41-860.02 State firearm

The colt single action army revolver is the official state firearm.

§ 41-860.03 State metal

Copper is the official state metal.

§ 41-860.04 State mineral

Wulfenite is the official state mineral.

§ 41-860.05 State dinosaur

Sonorasaurus is the official state dinosaur.

§ 41-860.06 State drink

Lemonade is the official state drink.

§ 41-860.07 Sierra Vista; hummingbird capital

Sierra Vista is the official hummingbird capital of this state.

§ 41-860.08 State planet

Pluto is the official state planet.

Chapter 4.2 Historic Preservation

Article 1 General Provisions

§ 41-861 Agency responsibilities

The chief administrator of each state agency is responsible for the preservation of historic properties which are owned or controlled by the agency. Prior to acquiring, constructing or leasing buildings for purposes of carrying out agency responsibilities, each agency shall consider the use of historic properties available to the agency. Each agency shall undertake any preservation that is necessary to carry out this article in a manner consistent with the preservation of historic properties, the duties of the agency and the professional standards which the state historic preservation officer recommends. The chief administrator of a state agency may designate a full-time employee to coordinate the agency's activities under this article.

§ 41-862 Program

In cooperation with the state historic preservation officer, each state agency shall establish a program to locate, inventory and nominate to the Arizona register of historic places all properties that are under the agency's ownership or control and that appear to meet the criteria for inclusion on the register. Each state agency shall exercise caution to assure that the property is not inadvertently transferred, sold, demolished, substantially altered or allowed to deteriorate significantly. The state historic preservation officer shall include the performance of state agencies in initiating and satisfying the programmatic management of historic properties in the annual report to the legislature and the governor as provided in section 41-151.20.

§ 41-863 Records

Each state agency shall initiate measures, in consultation with the state historic preservation officer, to assure that if, as a result of state action or assistance given by the agency, historic property is to be substantially altered or demolished, timely steps are taken to make appropriate documentary recordation in accordance with standards which the state historic preservation officer establishes. The agency shall deposit the records with the Arizona state library, archives and public records and with the state historic preservation officer for future use and reference.

§ 41-864 Review of agency plans

The state historic preservation officer has thirty working days in which to review and comment on any plans of a state agency which involve property which is included on or may qualify for inclusion on the Arizona register of historic places, including any construction project, sale, lease or acquisition of historic properties, to ensure that the prehistorical, historical, architectural or culturally significant values will be preserved or enhanced.

§ 41-865 Disturbing human remains or funerary objects; rules; violation; classification; definitions

A. A person shall not intentionally disturb human remains or funerary objects on lands, other than lands owned or controlled by this state, any agency or institution of this state or any county or municipal corporations within this state, without obtaining the written permission of the director of the Arizona state museum.

B. A person who unintentionally disturbs human remains or funerary objects on lands, other than lands owned or controlled by this state, any agency or institution of this state or any county or municipal corporations within this state, shall report the disturbance to the director and shall not further disturb the remains or objects without obtaining the written permission of the director.

C. Within one year after the effective date of this section, the director shall adopt rules relating to reporting procedures, procedures to request permission to disturb human remains and funerary objects and the standards to be used for granting permission to disturb human remains and funerary objects. These rules shall:

Require the director to respond within ten working days to all requests for permission to disturb. During this ten working day period the director or his designee shall inspect, if appropriate, the site of the proposed disturbance. If the director does not respond to a request to disturb within ten working days, his failure to respond to the request is deemed permission to proceed.
Require the respectful treatment of all human remains and funerary objects.
Minimize the disturbance of human remains and funerary objects and, if disturbance is necessary, provide for reburial at an appropriate site or provide for other appropriate relocation.
Require consultation with representatives from the scientific community and groups with a cultural affinity regarding the treatment and protection of human remains and funerary objects.
If Native American human remains or funerary objects are involved, give the governing body of the group with a cultural affinity the authority to take responsibility for the remains or objects and to determine the most appropriate treatment or disposition of them pursuant to subsection E. In no event shall this state or any group, individual or entity benefit financially from the sale of any human remains or funerary objects removed from private property.
Fully protect the constitutional rights of property owners.

D. Before the adoption of rules pursuant to subsection C, the director shall respond to such requests within ten working days.

E. If the director or a group with a cultural affinity in consultation with the landowner determines that human remains or funerary objects shall be preserved in place, moved or reburied, any costs required by these actions may be borne either wholly or partially by the landowner. If the landowner is unwilling or unable to bear the costs required, the acquisition and preservation fund shall bear the full cost of removal. A group or institution taking responsibility for these remains or objects shall bear the cost of their preservation or reburial. If there are insufficient monies in the acquisition and preservation fund, or if the director is unable or unwilling to allocate monies for the removal and no other source is available to pay for removal within the ten working day period, the landowner, the lessee or the landowner's or lessee's agent may proceed with work on a construction project or similar project without violating the provisions of subsection A or B. The removal of all remains and objects under this subsection shall take place within ten working days of the request for the permission to disturb unless the owner of the property where the remains or objects are located agrees to an extension of this period.

F. If it is necessary to move the object before completion of the proceedings prescribed by this section in order to permit the continuation of work on a construction project or similar project, the director shall require that the move be accomplished in the manner that will least disturb and best preserve the remains or the objects.

G. A person who intentionally possesses, sells or transfers any human remains or funerary objects that are excavated or removed in violation of subsection A or B is guilty of a class 5 felony. On conviction the person forfeits to the Arizona state museum all human remains, funerary objects and other artifacts removed in connection with the violation of subsection A or B and all proceeds from the sale of these remains, objects or artifacts.

H. A person who otherwise intentionally violates subsection A or B is guilty of a class 1 misdemeanor. On conviction the person forfeits to the Arizona state museum all human remains, funerary objects and other artifacts removed in connection with the violation of subsection A or B.

I. The state agrees to indemnify and hold harmless landowners, lessees or their agents who seek permission under this section from any accidents, injuries or losses caused by state employees or their designees as a result of this section.

J. For the purposes of this section:

"Director" means the director of the Arizona state museum.
"Funerary object" means an object discovered in close proximity to human remains and interred with the remains.
"Group" includes American Indian tribes.
"Group with cultural affinity" means any group that has cultural affinity with the human remains or funerary objects in light of all of the relevant evidence.
"Human remains" means any remains of a human being who died more than fifty years before the remains are discovered.
"Tribe" means any federally recognized tribal government.

§ 41-866 Acquisition and preservation fund

A. An acquisition and preservation fund is established consisting of monies received from fines and forfeitures of proceeds imposed pursuant to section 41-865, subsections G and H and from grants and private donations.

B. The director of the Arizona state museum shall administer the fund. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. The director shall expend monies in the fund to defray the costs of the acquisition of real property that contains human remains and funerary objects and the costs of the removal, reburial, repatriation and preservation of human remains and funerary objects.

D. Monies in the fund are exempt from the provisions of section 35-190, relating to lapsing of appropriations.

§ 41-867 Arizona dude ranch heritage trail program; Arizona heritage ranch designation; plaque; Arizona heritage trail; historical marker

A. The Arizona dude ranch heritage trail program is established in the Arizona state parks board to serve as a guide to working dude ranches in this state.

B. The Arizona state parks board shall designate a dude ranch for inclusion in the Arizona dude ranch heritage trail program if all of the following apply:

The owner of the dude ranch applies to the Arizona state parks board in a manner determined by the Arizona state parks board.
The dude ranch has been in business for at least twenty-five years.
The dude ranch consists of at least one thousand contiguous acres that are any of the following:

(a) Private property adjacent to the headquarters.

(b) Leased property adjacent to the headquarters. For the purposes of this subdivision, the lease agreement may be for private or public real property and must be in writing and include riding rights.

The dude ranch provides recreational activities that include horseback riding, hiking, biking or a working cattle ranch experience for guests.
The dude ranch has an organized and supervised horse program on the property with a horse herd that consists of a number of horses that is equal to or greater than the total number of guest accommodations during the operating season in which guests are present.
The dude ranch uses at least one permanent structure that has running water, sewage disposal and a kitchen.
The dude ranch provides guests with three meals each day as part of the dude ranch's primary package, commonly referred to as the "American plan".
The dude ranch includes the word "ranch" or "rancho" in the ranch's name.

C. The Arizona state parks board shall make a determination on the designation within thirty days after receiving an application pursuant to this section.

D. The Arizona state parks board in cooperation with the largest dude ranch or guest ranch association in this state shall develop indicia and signage that ranches may use to identify and promote the Arizona heritage ranch designation. The applicant shall pay for the cost of designing and creating the plaque.

E. The Arizona state parks board shall allow additions or modifications to a dude ranch with designation as an Arizona heritage ranch if the original character of the dude ranch is preserved.

F. The Arizona dude ranch heritage trail shall consist of dude ranches that are designated as an Arizona heritage ranch pursuant to this section.

G. At the request of a dude ranch that is designated for inclusion in the Arizona dude ranch heritage trail program pursuant to subsection B of this section, the Arizona historical society, in cooperation with the Arizona state parks board and the largest dude ranch or guest ranch association in this state, shall issue a historical marker for the dude ranch within two years after the request.

Article 2 Historic Property Rehabilitation

§ 41-881 Historic property rehabilitation program; administration; purposes; special projects; state contribution; standards; protective covenant; report

A. A state historic property rehabilitation program is established to be administered by the Arizona state parks board through the state historic preservation officer. All decisions relating to the program by the state historic preservation officer are subject to approval by the Arizona state parks board. The state historic preservation officer may provide for the staff necessary for the operation of the program.

B. Monies from appropriations may be allocated by the state historic preservation officer for special project priorities established annually by the state historic preservation officer.

C. Monies from appropriations for historic property rehabilitation shall be used for the purpose of providing state monies up to an amount equal to the amount of cash, materials and labor from any other source for the rehabilitation of buildings, structures, archaeological sites and objects all or part of which are publicly owned or owned by a nonprofit entity and which are listed in the Arizona or national register of historic places including a property listed individually or as a contributing property within a historic district.

D. The state historic preservation officer shall establish guidelines for application and selection of rehabilitation project sponsors. The state historic preservation officer shall establish annually the amount of cash, materials and labor committed by the sponsor for determination of the amount of the state grant. The rehabilitation work shall meet the United States secretary of the interior's standards for rehabilitating historic properties or other appropriate rehabilitation or archaeological standards as determined by the historical advisory commission. The project sponsor shall sign and record a protective covenant on the property in accordance with terms and for a period of time based on the amount of the state grant as determined by the state historic preservation officer.

E. The state historic preservation officer shall include the activities of the historic property rehabilitation grants program in the report to the governor and legislature required in section 41-151.20.

Article 1 General Provisions

§ 41-901 Governor's authority

The governor shall have charge and control of the Arizona pioneers' home, the state hospital for miners with disabilities, the state prison and prison farm and other state institutions the management of which is not otherwise provided by law.

§ 41-902 Fiscal controls on institutions

A. Compensation for officers and employees of state institutions under the control of the governor shall be fixed by the governor pursuant to section 38-611 unless otherwise provided by law. Employee compensation shall be included in the estimate of expenses submitted by the chief executive officer of the institution.

B. Each chief executive officer shall furnish a semi-monthly payroll for the institution under his charge, showing the name, monthly salary and length of service of each officer and employee. The payroll shall be audited by the governor and a statement of the amount found due each employee shall be filed with the director of the department of administration who shall issue a separate warrant to each employee.

C. A bond in an amount to be fixed by the governor shall be required from each official and employee having custody of funds or property belonging to the state.

D. The remittance of money and other things of value received by the institution shall be governed by title 35, chapter 1 so far as applicable, and the proper executive officer of each institution shall in addition make a detailed statement showing the sources of such receipts to the governor.

§ 41-903 Officers and employees; employment

Subject to chapter 4, article 4 of this title, the chief executive officer of each institution under the control of the governor shall appoint assistants, clerks, guards and employees required to operate the institution, the number to be determined by the governor, except as otherwise provided by law.

§ 41-904 Inspection of institutions; repairs and improvements

A. The governor shall, without notice, visit each institution under his control at least once every four months, and inspect every part of the institution and all places, buildings and grounds belonging thereto or used in connection therewith.

B. The governor shall have general charge of the erection of new buildings and of repairs and improvements of buildings, and improvement of grounds and other properties belonging to the institutions under his control, and may, in the name of the state, bring actions necessary to protect the interests of the state therein.

§ 41-905 Credit transfers for intra-institutional sales

A. When an institution maintained wholly by the state sells agricultural products, goods, wares or merchandise produced, manufactured or prepared by its inmates or wards to another institution for use therein or by the inmates or wards therein, the institution making the sale shall be reimbursed through a credit transfer for the cost, which shall not exceed the price in the open market of the products, goods, wares or merchandise.

B. The superintendent or managing head of the institution making the sale shall prepare a claim against the purchasing institution, and the claim, when approved by the proper officer of the purchasing institution and by the governor, shall be presented to the department of administration and audited as other claims. If the department of administration finds the claim valid, it shall charge the amount thereof to the appropriate fund of the institution against which it is drawn, and shall credit the appropriate fund of the institution presenting the claim.

§ 41-906 Return of alien and nonresident public charges

A. The governor shall cooperate with the United States commissioner general of immigration and with boards or officials of foreign countries for the purpose of arranging and providing for the return to the foreign countries of alien public charges confined in the state hospital or in the industrial school, and of aliens discharged from the state prison.

B. To facilitate the return of nonresident public charges confined in the state hospital, or in the state industrial school, the governor may enter into reciprocal agreements or arrangements with officers of other states for the mutual exchange of such public charges, and in pursuance thereof the governor may give written consent and approval of the return to the state of any resident of this state confined in a public institution of another state, corresponding to hospitals or asylums for the insane, or of a state institution for the reformation of delinquent minors.

C. A person shall not be deemed a resident of this state for the purposes of this section unless he has resided continuously in the state for one year next preceding commitment to any of the institutions named in this section.

D. The expenses incurred in returning aliens and nonresident public charges shall be paid by the state, but the expense of returning residents of this state to this state shall not be paid by this state.

Article 2 Arizona Pioneers' Home

§ 41-921 Arizona pioneers' home; establishment; location

A home for aged and infirm Arizona pioneers is established and shall be known as the "Arizona pioneers' home". For the purposes prescribed in section 25 of the enabling act, the pioneers' home shall be designated as the state hospital for miners with disabilities. The home shall be maintained at or near Prescott, Arizona.

§ 41-922 Superintendent of home for pioneers; appointment; compensation

A. The governor shall appoint a superintendent of the Arizona pioneers' home.

B. The superintendent shall receive compensation as determined pursuant to section 38-611.

§ 41-923 Admission to home; qualifications required; payment of costs; neglect or refusal to reimburse state

A. A person of good character is eligible to be admitted to the Arizona pioneers' home who:

Is and has been for a period of five years prior to his application for admission a citizen or legal resident of the United States.
Has been a resident of this state for not less than fifty years.
Has reached the age of seventy or more years.
At the time of admission, is ambulatory, has proper bowel and bladder control and is able to bathe, clothe and feed himself without assistance.
At the time of admission, does not require care in a hospital or in a skilled care or intermediate care nursing home.

B. An applicant for admission to the home shall submit to the superintendent a verified financial statement showing all assets and income, a social and health history and the results of a current medical examination on forms furnished or approved by the superintendent.

C. The superintendent may admit a person to the home when a full examination and investigation reveal that the person possesses the qualifications prescribed by this section.

D. A person admitted to the Arizona pioneers' home shall pay to this state, to the extent that he is financially able to do so, the cost incurred by this state for his care. The cost shall be paid monthly to the superintendent and shall not be in excess of the average monthly per capita cost of operating the home based on the average number of persons then residing at the home during the year. A person who neglects or refuses to reimburse this state as required under this subsection shall not be permitted to reside at the home during the continuance of this neglect or refusal to pay. This subsection applies only to those persons admitted to the home after August 11, 1970.

E. In determining the cost to the person, the superintendent shall consider the same factors for each person and shall include all assets and income of the person including the fair market value of any asset owned by the person and disposed of during residency or within two years before admission to the home. The superintendent shall verify all applicant and resident financial information.

§ 41-924 Duties of superintendent; approval of claims; disposition of monies collected

A. The superintendent of the home shall, subject to the directions of the governor, be charged with the care, custody and management of the home.

B. The superintendent shall admit persons to the home and shall see that persons admitted to the home are comfortably cared for, fed and provided necessary medications and furnished with necessary medical treatment in the most cost-effective manner determined by the superintendent. For the purposes of this subsection:

"Formulary" means a listing of drugs intended to include a large enough range of drugs to enable health practitioners to prescribe treatment that is medically appropriate.
"Necessary medical treatment" means procedures, treatment and medical equipment covered by a resident's medical insurance plan.
"Necessary medications" means medications that are prescribed by the resident's physician and that are on a formulary or are nonformulary prescriptions that are approved by the superintendent through a prior authorization process.

C. The superintendent shall select a supplemental medical insurance plan for residents of the home. Residents of the home shall participate in the supplemental medical insurance plan selected by the superintendent. If a resident does not participate in the supplemental medical insurance plan selected by the superintendent, the resident assumes all financial and logistical responsibility for the resident's medical care.

D. Claims for salaries and expenses authorized by this article shall be approved by the governor.

E. The superintendent, on or before the tenth day of each month, shall deposit, pursuant to sections 35-146 and 35-147, all monies received under this article in the state general fund.

§ 41-925 Voluntary deposit of private funds by resident with superintendent

The superintendent is the only employee of the Arizona pioneers' home authorized to accept from residents of the home private funds of such residents for safekeeping, to be held in trust for such residents. Such funds shall be disbursed by the superintendent only upon instruction of the residents or by order of a court of competent jurisdiction.

§ 41-926 Arizona pioneers' home fund; collections; disbursements

A. The Arizona pioneers' home fund is established consisting of monies, grants, gifts and contributions donated to the Arizona pioneers' home and proceeds deposited pursuant to section 41-927. The fund shall be divided into a special donations account and a cemetery proceeds account.

B. The superintendent of the Arizona pioneers' home shall administer the fund. Monies in the cemetery proceeds account are continuously appropriated. The monies in the Arizona pioneers' home fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

C. The superintendent or the superintendent's designee may receive donations from the public for the Arizona pioneers' home. The donations shall be deposited, pursuant to sections 35-146 and 35-147, in the special donations account and are subject to state auditing procedures. The donations shall be used in accordance with the requests of the donor for activities or purchases that benefit the residents or the home, or for staff education or recognition or any other such purpose approved by the superintendent. The donations will be disbursed by the superintendent only for these purposes or at the specific request of the donor.

D. Monies in the cemetery proceeds account shall be used for the statutorily prescribed purposes of the Arizona pioneers' home and for the Arizona pioneers' home cemetery.

§ 41-927 Arizona pioneers' home cemetery; management; exemption

A. The superintendent of the home shall manage the state sovereign land described as follows:

Yavapai county parcel number 115-09-98A; section 29, township 14 north, range 2 west of the Gila and Salt River base and meridian, Yavapai county, Arizona.

B. The superintendent of the home:

Shall maintain the Arizona pioneers' home cemetery located on the land described in subsection A of this section.
May authorize burials in the Arizona pioneers' home cemetery located on the land described in subsection A of this section.
Shall not sell, exchange or barter the land described in subsection A of this section, with the exception of interment rights. The superintendent shall deposit, pursuant to sections 35-146 and 35-147, the proceeds from any sale of interment rights in the cemetery proceeds account established by section 41-926.
May lease portions of the land described in subsection A of this section. The superintendent shall deposit, pursuant to sections 35-146 and 35-147, the proceeds from any lease of this land in the cemetery proceeds account established by section 41-926.

C. The superintendent of the home and the cemetery are exempt from the requirements of title 32, chapter 20.

Article 3 Hospitals for Disabled Miners

§ 41-941 Location; superintendent; claims

A. There shall be a state hospital for miners with disabilities as a separate facility for the benefit of miners with disabilities at the Arizona pioneers' home at Prescott which shall be managed by the governor.

B. The superintendent of the Arizona pioneers' home shall serve as superintendent of the miner's hospital and, subject to chapter 4, article 4 of this title, may appoint assistants and employees and prescribe their duties, subject to approval of the governor.

C. Claims for salaries and expenses authorized by this article shall be presented and paid as other state claims.

§ 41-942 Qualifications for admission to hospital; definitions

A. A person, under the order of the governor, shall be admitted to the hospital for miners with disabilities who:

Has been a resident while in the occupation of mining in this state.
Is a citizen or legal resident of the United States.
Has reached the age of sixty years or more, and is financially unable to support himself, or has suffered incapacitating injuries arising from and in the course of mining.

B. Based on available space and funding, the governor may approve a person for admission to the hospital for miners with disabilities who has not yet reached the age of sixty years but otherwise qualifies for admission under subsection A.

C. For the purposes of this section:

"Claim" has the same meaning prescribed in section 27-301.
"Mine" has the same meaning prescribed in section 27-301.
"Mining":

(a) Has the same meaning prescribed in section 27-301.

(b) Does not include performing executive, administrative, support or clerical functions for the owner or operator of a mine, unless a person who performs executive, administrative, support or clerical functions for the owner or operator of the mine had significant environmental exposure to mining activities that could be detrimental to a person's health.

Article 4 Arizona Rangers' Pensions

§ 41-951 Qualification for pension; adjustment

A. Every person who for a period of not less than six months was a member of and received an honorable discharge from the organization known as the Arizona Rangers, created by chapter 2 of title 46, Revised Statutes of Arizona, 1901, and amended by chapter 64 of the twenty-second legislative assembly of the territory of Arizona, 1903, and who has continuously resided in the territory and state of Arizona since the date of such honorable discharge, and has not been convicted of a felony, shall be entitled to a pension of six hundred fifty dollars per month as provided by this article, until death or removal from the state.

B. The department of administration shall annually adjust the amount of pensions according to the annual changes in the GDP price deflator as defined in section 41-563.

§ 41-952 Application

Any person desiring to avail himself of the provisions of this article shall make application to the governor, under oath, in such form as the governor prescribes for such pension, and shall submit proof of his eligibility therefor.

§ 41-953 Certificate of eligibility

If the governor is satisfied from the proof furnished that the applicant is entitled to a pension, he shall issue to the applicant a pension certificate to that effect in a form to be approved by the attorney general and by the department of administration, setting forth the name and address of the pensioner, the date of his discharge, the date upon which payment of the pension shall begin, and such other items as the governor deems proper. The certificate shall be delivered to the pensioner, and the allowance thereunder certified to the department of administration.

§ 41-954 Pension roll warrants

The department of administration shall keep a rangers' pension roll on which shall be entered the names of all pensioners certified by the governor, the date of allowance of each pension, and all payments made thereunder. The department of administration shall draw a warrant each month in favor of each such pensioner and mail it to his last known address.

§ 41-955 Pension not subject to process

A. A pension allowed under this article shall not be subject to garnishment, attachment, judgment, execution or other legal process.

B. A person to whom a pension is allowed shall not assign the pension, nor shall any officer or board upon which a duty is imposed with respect to the administration of this article recognize an assignment of such pension or pay any sum whatever which has been thus assigned or attempted to be assigned.

§ 41-956 Surviving spouse's rights

A. The surviving spouse of an Arizona ranger upon the death of the ranger and submission to the governor of an affidavit that the spouse was married to the ranger on or before July 1, 1945, and has been the spouse of the ranger continuously until the date of the ranger's death, is entitled to receive the monthly pension provided in this article.

B. The pension received by the surviving spouse is payable until the date of the spouse's death and is subject to the same limitations provided in section 41-955.

Article 6 Arizona Commission on the Arts

§ 41-981 Establishment of commission; members; terms

A. An Arizona commission on the arts is established consisting of fifteen members appointed by the governor. Members shall be qualified primarily for their demonstrated ability, good judgment and wide experience in fields related to the arts and shall be selected so as to insure geographic representation to all areas of the state.

B. Each member shall serve for a term of three years. Appointment to fill a vacancy resulting other than from expiration of term shall be for the unexpired term only. The governor shall designate a chairman and vice-chairman from the members of the commission to serve at the pleasure of the governor. The executive director is the chief executive officer of the commission.

C. Members of the commission shall not receive compensation for their services.

D. A member absent from three consecutive meetings of the commission without justifiable excuse constitutes an abandonment of the office and the governor shall appoint a person to fill the unexpired term.

§ 41-982 Powers and duties

A. The commission may:

With the consent of a majority of the commission, employ, subject to chapter 4, article 4 of this title, such personnel as may be required within the limits of funds available in the arts fund. The compensation for such personnel shall be as determined pursuant to section 38-611.
Hold hearings.
Enter into contracts, within the limits of funds available, with local and regional associations, individuals, organizations and institutions for any services which further the broad objectives of the commission's program.
Accept gifts, contributions and bequests of unrestricted funds for deposit in the arts fund or the arts trust fund from individuals, foundations, corporations, and other organizations or institutions for the purpose of furthering the broad objectives of the commission's program.
Make agreements to carry out the purposes of this article.
Request cooperation from any state agency for the purposes of this article.

B. The commission shall:

Stimulate and encourage throughout the state the study and presentation of the performing arts, fine arts, and public interest and participation therein.
Make such surveys of public and private institutions engaged within the state in artistic and cultural activities, as may be deemed advisable, and make recommendations concerning appropriate methods to encourage participation in and appreciation of the arts to meet the legitimate needs and aspirations of persons in all parts of the state.
Take such steps as may be necessary and appropriate to encourage public interest in the cultural heritage of our state and to expand the state's cultural resources.
Encourage and assist freedom of artistic and scholarly expression essential for the well-being of the arts.
Formulate policies and adopt rules and regulations which are consistent with the purposes of this article.

§ 41-983 Acceptance of gifts; special fund; official agency

A. The Arizona commission on the arts may accept and expend public and private grants of funds, gifts, contributions and legacies, and may accept, manage or dispose of property, to effectuate the purposes of this article. Such funds shall be deposited, pursuant to sections 35-146 and 35-147, in a special fund designated "the arts fund" and shall be expended upon warrants drawn by the department of administration upon order of the chairman of the commission. Any unexpended funds shall not revert to the general fund at the close of the fiscal year.

B. Notwithstanding any other law, no monies from the Arizona commission on the arts may be spent for payment to any person or entity for use in desecrating, casting contempt on, mutilating, defacing, defiling, burning, trampling or otherwise dishonoring or causing to bring dishonor on religious objects, the flag of the United States or the flag of this state. The commission shall establish grant making guidelines and procedures which take into consideration general standards of decency and respect for the diverse beliefs and values of the American public. Such guidelines and procedures shall clearly indicate that obscenity is without artistic merit and is not protected speech. Projects, productions, workshops and programs that are determined to be obscene are prohibited from receiving financial assistance. The disapproval or approval of grant application or financial support by the commission shall not be construed to mean and shall not be considered as evidence that a project, production, workshop or program is or is not obscene.

C. The commission shall be the official agency of the state to receive and disburse any funds made available by the national endowment on the arts.

§ 41-983.01 Arizona arts trust fund

A. There is established the Arizona arts trust fund. The trust fund shall be administered by the Arizona commission on the arts and shall consist of revenues derived from filing fees collected pursuant to section 10-122. The commission shall deposit, pursuant to sections 35-146 and 35-147, such revenues into the trust fund at least quarterly.

B. On notice from the commission, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the trust fund. Monies in the fund shall not revert to the state general fund.

C. Expenditures from the trust fund for grants under the Arizona arts program shall be authorized by a majority vote of the commission. All other expenditures may be authorized by the chairman of the commission. Expenditures shall be made upon warrants drawn by the department of administration.

§ 41-983.02 Arizona arts program

A. There is established an Arizona arts program to be administered by the Arizona commission on the arts. The purpose of the program shall be to advance and to foster the arts in Arizona through grants from the Arizona arts trust fund.

B. The commission shall establish rules for the administration of the program including grant applications and criteria to be utilized when evaluating applications. Such criteria shall include but shall not be limited to artistic quality, creativity, potential public exposure and public benefit, and the ability of the recipient to properly administer funds granted. The commission shall further establish criteria to assure all of the following:

A portion of the funds is granted to organizations representing persons with disabilities.
A portion of the funds is granted to artists who are members of racial or ethnic minorities.
A portion of the funds is granted to organizations representing rural areas.
Recipient arts organizations include on their governing boards members of racial or ethnic minorities.

C. All grants shall be authorized by a majority vote of the members of the commission.

D. Each grant recipient shall submit a detailed report at least annually to the commission outlining the uses and expenditure of any funds granted from the Arizona arts trust fund. Recipients shall agree to any auditing requirements relating to the use of grant funds as set forth by the commission.

§ 41-984 Annual report

The Arizona commission on the arts shall prepare and submit an annual report to the governor and the legislature including a detailed accounting of the expenditures and grants from the arts fund and the Arizona arts trust fund no later than December 31 of each year.

§ 41-986 Arizona arts endowment fund

A. The Arizona arts endowment fund is established consisting of monies appropriated annually to the fund.

B. The Arizona commission on the arts shall administer the fund. On notice from the commission, the state treasurer shall invest and divest monies in the fund as provided by section 35-313. Monies earned from investment:

Shall be credited to the fund.
Are a continuing appropriation to the commission.

C. The commission may not spend any monies in the fund except monies earned from investment of fund monies.

D. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. The commission may enter into contracts with private charitable, nonprofit organizations that qualify for tax exemption under section 501(c)(3) of the United States internal revenue code to administer monies that are donated by the organization for use in conjunction with monies from the Arizona arts endowment fund. The commission shall adopt rules regarding matching private monies with monies from the Arizona arts endowment fund in a manner consistent with the intent of the fund.

F. The commission shall include in its annual report an accounting of the private monies that are donated for use in conjunction with the monies from the Arizona arts endowment fund.

G. Notwithstanding any law to the contrary, no monies from the Arizona arts endowment fund may be spent for payment to any person or entity for use in desecrating, casting contempt on, mutilating, defacing, defiling, burning, trampling or otherwise dishonoring or causing to bring dishonor on religious objects, the flag of the United States or the flag of this state.

§ 41-987 State poet laureate; appointment; term; duties; nomination committee

A. The office of state poet laureate is established under the Arizona commission on the arts.

B. The governor, based on a ranked list of three nominees provided by the state poet laureate nomination committee, shall appoint one person to serve as the state poet laureate. The governor shall have sixty days from receipt of the nominee list to make the selection. Each nominee shall have been a resident of this state for at least two years as of the date of nomination, reside in this state for at least six months of the year, be a poet of stature recognized in the literary, cultural, education or academic communities and have a significant prior record of high quality, published or documented work or service through the literary arts. Nominees must be willing and able to travel throughout this state.

C. The state poet laureate serves a two year term to begin and end on the third Monday in January of the corresponding year. The state poet laureate may not serve more than three terms.

D. The duties of the state poet laureate include:

The offering of at least four public readings each year during the appointment term, in both urban and rural communities, visiting the various regions of this state at least once during the appointment term.
The pursuit of a major literary project over the course of the appointment term, agreed on between the state poet laureate and the commission. These projects shall place an emphasis on outreach to residents who might not otherwise be exposed to quality poetry.
The pursuit of other projects related to poetry and the literary arts, including collaboration with the poet laureate of the United States, other state poets laureate or other artists, that the state poet laureate and the commission may find beneficial.

E. The state poet laureate nomination committee is established consisting of at least four and not more than seven members who are appointed by the commission. The members shall represent different geographic regions of this state and may include any of the following:

Professional poets.
Writers from other literary disciplines.
Creative writing and literature professors and teachers.
Board members and directors of literary organizations.
Literary critics.
Others deemed by the commission to have significant expertise in contemporary American literature.
Members of the public.

F. The commission shall establish a process to solicit applications and nominations from any of the following:

University and college literature, creative writing and English departments.
Literary organizations and societies.
Book publishers and editors.
Directors of poetry reading series.
Charter, private and public schools.
Booksellers specializing in poetry.
The commission's grantee database, mailing lists and social media efforts.
Members of the public.

§ 41-988 State poet laureate fund

The state poet laureate fund is established consisting of gifts, grants and donations. The commission shall administer the fund. Monies in the fund are continuously appropriated. The commission shall pay the costs and expenses of the state poet laureate established by section 41-987 from the monies available in the fund.

Chapter 6 Administrative Procedure

Article 1 General Provisions

§ 41-1001 Definitions

In this chapter, unless the context otherwise requires:

"Agency" means any board, commission, department, officer or other administrative unit of this state, including the agency head and one or more members of the agency head or agency employees or other persons directly or indirectly purporting to act on behalf or under the authority of the agency head, whether created under the Constitution of Arizona or by enactment of the legislature. Agency does not include the legislature, the courts or the governor. Agency does not include a political subdivision of this state or any of the administrative units of a political subdivision, but does include any board, commission, department, officer or other administrative unit created or appointed by joint or concerted action of an agency and one or more political subdivisions of this state or any of their units. To the extent an administrative unit purports to exercise authority subject to this chapter, an administrative unit otherwise qualifying as an agency must be treated as a separate agency even if the administrative unit is located within or subordinate to another agency.
"Appealable agency action" has the same meaning prescribed in section 41-1092.
"Audit" means an audit, investigation or inspection pursuant to title 23, chapter 2 or 4.
"Code" means the Arizona administrative code, which is published pursuant to section 41-1011.
"Committee" means the administrative rules oversight committee.
"Contested case" means any proceeding, including rate making, except rate making pursuant to article XV, Constitution of Arizona, price fixing and licensing, in which the legal rights, duties or privileges of a party are required or permitted by law, other than this chapter, to be determined by an agency after an opportunity for an administrative hearing.
"Council" means the governor's regulatory review council.
"Delegation agreement" means an agreement between an agency and a political subdivision that authorizes the political subdivision to exercise functions, powers or duties conferred on the delegating agency by a provision of law. Delegation agreement does not include intergovernmental agreements entered into pursuant to title 11, chapter 7, article 3.
"Emergency rule" means a rule that is made pursuant to section 41-1026.
"Fee" means a charge prescribed by an agency for an inspection or for obtaining a license.
"Final rule" means any rule filed with the secretary of state and made pursuant to an exemption from this chapter in section 41-1005, made pursuant to section 41-1026, approved by the council pursuant to section 41-1052 or 41-1053 or approved by the attorney general pursuant to section 41-1044. For purposes of judicial review, final rule includes expedited rules pursuant to section 41-1027.
"General permit" means a regulatory permit, license or agency authorization that is for facilities, activities or practices in a class that are substantially similar in nature and that is issued or granted by an agency to a qualified applicant to conduct identified operations or activities if the applicant meets the applicable requirements of the general permit, that requires less information than an individual or traditional permit, license or authorization and that does not require a public hearing.
"License" includes the whole or part of any agency permit, certificate, approval, registration, charter or similar form of permission required by law, but does not include a license required solely for revenue purposes.
"Licensing" includes the agency process respecting the grant, denial, renewal, revocation, suspension, annulment, withdrawal, change, reduction, modification or amendment of a license, including an existing permit, certificate, approval, registration, charter or similar form of permission, approval or authorization obtained from an agency by the holder of a license.
"Licensing decision" means any action by an agency to grant or deny any request for permission, approval or authorization issued in response to any request from an applicant for a license or to the holder of a license to exercise authority within the scope of the license.
"Party" means each person or agency named or admitted as a party or properly seeking and entitled as of right to be admitted as a party.
"Person" means an individual, partnership, corporation, association, governmental subdivision or unit of a governmental subdivision, a public or private organization of any character or another agency.
"Preamble" means:

(a) For any rulemaking subject to this chapter, a statement accompanying the rule that includes:

(i) Reference to the specific statutory authority for the rule.

(ii) The name and address of agency personnel with whom persons may communicate regarding the rule.

(iii) An explanation of the rule, including the agency's reasons for initiating the rulemaking.

(iv) A reference to any study relevant to the rule that the agency reviewed and either proposes to rely on in its evaluation of or justification for the rule or proposes not to rely on in its evaluation of or justification for the rule, where the public may obtain or review each study, all data underlying each study and any analysis of each study and other supporting material.

(v) The economic, small business and consumer impact summary, or in the case of a proposed rule, a preliminary summary and a solicitation of input on the accuracy of the summary.

(vi) A showing of good cause why the rule is necessary to promote a statewide interest if the rule will diminish a previous grant of authority of a political subdivision of this state.

(vii) Such other matters as are prescribed by statute and that are applicable to the specific agency or to any specific rule or class of rules.

(b) In addition to the information set forth in subdivision (a) of this paragraph, for a proposed rule, the preamble also shall include a list of all previous notices appearing in the register addressing the proposed rule, a statement of the time, place and nature of the proceedings for the making, amendment or repeal of the rule and where, when and how persons may request an oral proceeding on the proposed rule if the notice does not provide for one.

(c) In addition to the information set forth in subdivision (a) of this paragraph, for an expedited rule, the preamble also shall include a statement of the time, place and nature of the proceedings for the making, amendment or repeal of the rule and an explanation of why expedited proceedings are justified.

(d) For a final rule, except an emergency rule, the preamble also shall include, in addition to the information set forth in subdivision (a), the following information:

(i) A list of all previous notices appearing in the register addressing the final rule.

(ii) A description of the changes between the proposed rules, including supplemental notices and final rules.

(iii) A summary of the comments made regarding the rule and the agency response to them.

(iv) A summary of the council's action on the rule.

(v) A statement of the rule's effective date.

(e) In addition to the information set forth in subdivision (a) of this paragraph, for an emergency rule, the preamble also shall include an explanation of the situation justifying the rule being made as an emergency rule, the date of the attorney general's approval of the rule and a statement of the emergency rule's effective date.

"Provision of law" means the whole or a part of the federal or state constitution, or of any federal or state statute, rule of court, executive order or rule of an administrative agency.
"Register" means the Arizona administrative register, which is:

(a) This state's official publication of rulemaking notices that are filed with the office of secretary of state.

(b) Published pursuant to section 41-1011.

"Rule" means an agency statement of general applicability that implements, interprets or prescribes law or policy, or describes the procedure or practice requirements of an agency. Rule includes prescribing fees or the amendment or repeal of a prior rule but does not include intraagency memoranda that are not delegation agreements.
"Rulemaking" means the process to make a new rule or amend, repeal or renumber a rule.
"Small business" means a concern, including its affiliates, which is independently owned and operated, which is not dominant in its field and which employs fewer than one hundred full-time employees or which had gross annual receipts of less than four million dollars in its last fiscal year. For purposes of a specific rule, an agency may define small business to include more persons if it finds that such a definition is necessary to adapt the rule to the needs and problems of small businesses and organizations.
"Substantive policy statement" means a written expression which informs the general public of an agency's current approach to, or opinion of, the requirements of the federal or state constitution, federal or state statute, administrative rule or regulation, or final judgment of a court of competent jurisdiction, including, where appropriate, the agency's current practice, procedure or method of action based upon that approach or opinion. A substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents which only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties, confidential information or rules made in accordance with this chapter.

§ 41-1001.01 Regulatory bill of rights; small businesses

A. To ensure fair and open regulation by state agencies, a person:

Is eligible for reimbursement of fees and other expenses if the person prevails by adjudication on the merits against an agency in a court proceeding regarding an agency decision as provided in section 12-348.
Is eligible for reimbursement of the person's costs and fees if the person prevails against any agency in an administrative hearing as provided in section 41-1007.
Is entitled to have an agency not charge the person a fee unless the fee for the specific activity is expressly authorized as provided in section 41-1008.
Is entitled to receive the information and notice regarding inspections and audits prescribed in section 41-1009.
May review the full text or summary of all rulemaking activity, the summary of substantive policy statements and the full text of executive orders in the register as provided in article 2 of this chapter.
May participate in the rulemaking process as provided in articles 3, 4, 4.1 and 5 of this chapter, including:

(a) Providing written comments or testimony on proposed rules to an agency as provided in section 41-1023 and having the agency adequately address those comments as provided in section 41-1052, subsection D, including comments or testimony concerning the information contained in the economic, small business and consumer impact statement.

(b) Filing an early review petition with the governor's regulatory review council as provided in article 5 of this chapter.

(c) Providing written comments or testimony on rules to the governor's regulatory review council during the mandatory sixty-day comment period as provided in article 5 of this chapter.

Is entitled to have an agency not base a licensing decision in whole or in part on licensing conditions or requirements that are not specifically authorized by statute, rule or state tribal gaming compact as provided in section 41-1030, subsection B.
Is entitled to have an agency not base a decision regarding any filing or other matter submitted to an agency on a requirement or condition that is not specifically authorized by a statute, rule, federal law or regulation or state tribal gaming compact as provided in section 41-1030, subsection C.
Is entitled to have an agency not make a rule under a specific grant of rulemaking authority that exceeds the subject matter areas listed in the specific statute or not make a rule under a general grant of rulemaking authority to supplement a more specific grant of rulemaking authority as provided in section 41-1030, subsection D.
May allege that an existing agency practice or substantive policy statement constitutes a rule and have that agency practice or substantive policy statement declared void because the practice or substantive policy statement constitutes a rule as provided in section 41-1033.
May file a complaint with the administrative rules oversight committee concerning:

(a) A rule's, practice's or substantive policy statement's lack of conformity with statute or legislative intent as provided in section 41-1047.

(b) An existing statute, rule, practice alleged to constitute a rule or substantive policy statement that is alleged to be duplicative or onerous as provided in section 41-1048.

May have the person's administrative hearing on contested cases and appealable agency actions heard by an independent administrative law judge as provided in articles 6 and 10 of this chapter.
May have administrative hearings governed by uniform administrative appeal procedures as provided in articles 6 and 10 of this chapter and may appeal a final administrative decision by filing a notice of appeal pursuant to title 12, chapter 7, article 6.
May have an agency approve or deny the person's license application within a predetermined period of time as provided in article 7.1 of this chapter.
Is entitled to receive written notice from an agency on denial of a license application:

(a) That justifies the denial with references to the statutes or rules on which the denial is based as provided in section 41-1076.

(b) That explains the applicant's right to appeal the denial as provided in section 41-1076.

Is entitled to receive information regarding the license application process before or at the time the person obtains an application for a license as provided in sections 41-1001.02 and 41-1079.
May receive public notice and participate in the adoption or amendment of agreements to delegate agency functions, powers or duties to political subdivisions as provided in section 41-1026.01 and article 8 of this chapter.
May inspect all rules and substantive policy statements of an agency, including a directory of documents, in the office of the agency director as provided in section 41-1091.
May file a complaint with the office of the ombudsman-citizens aide to investigate administrative acts of agencies as provided in chapter 8, article 5 of this title.
Unless specifically authorized by statute, may expect state agencies to avoid duplication of other laws that do not enhance regulatory clarity and to avoid dual permitting to the extent practicable as prescribed in section 41-1002.
May have the person's administrative hearing on contested cases pursuant to title 23, chapter 2 or 4 heard by an independent administrative law judge as prescribed by title 23, chapter 2 or 4.
Pursuant to section 41-1009, subsection E, may correct deficiencies identified during an inspection unless otherwise provided by law.

B. The enumeration of the rights listed in subsection A of this section does not grant any additional rights that are not prescribed in the sections referenced in subsection A of this section.

C. Each state agency that conducts audits, inspections or other regulatory enforcement actions pursuant to section 41-1009 shall create and clearly post on the agency's website a small business bill of rights. The agency shall create the small business bill of rights by selecting the applicable rights prescribed in this section and section 41-1009 and any other agency-specific statutes and rules. The agency shall provide a written document of the small business bill of rights to the authorized on-site representative of the regulated small business. In addition to the rights listed in this section and section 41-1009, the agency notice of the small business bill of rights shall include the process by which a small business may file a complaint with the agency employees who are designated to assist members of the public or regulated community pursuant to section 41-1006. The notice must provide the contact information of the agency's designated employees. The agency notice must also state that if the regulated person has already made a reasonable effort with the agency to resolve the problem and still has not been successful, the regulated person may contact the office of ombudsman-citizens aide.

§ 41-1001.02 Clarification of interpretation or application; exemption

A. Before submitting an application for a license a person may request from the agency issuing the license a clarification of its interpretation or application of a statute, rule, delegation agreement or substantive policy statement affecting the person's preparation of the application for a license by providing the agency with a written request that states:

The name and address of the person requesting the clarification.
The statute, rule, delegation agreement or substantive policy statement or part of the statute, rule, delegation agreement or substantive policy statement that the person is requesting be clarified.
Any facts relevant to the requested clarification.
The person's proposed interpretation of the applicable statute, rule, delegation agreement or substantive policy statement or part of the statute, rule, delegation agreement or substantive policy statement.
Whether, to the best knowledge of the person, the issues or related issues are being considered by the agency in connection with an existing license or license application.

B. On receipt of a request that complies with subsection A of this section:

The agency may meet with the person to discuss the written request and shall respond within thirty days of the receipt of the written request with a written clarification of its interpretation or application as raised in the written request.
The agency shall provide the requestor with an opportunity to meet and discuss the agency's written clarification.

C. Notwithstanding any other law, an agency's written clarification pursuant to this section does not constitute an appealable action as defined in section 41-1092 or an action against the party pursuant to section 41-1092.12.

D. Notwithstanding any other law, this section does not apply to the Arizona peace officer standards and training board.

§ 41-1002 Applicability and relation to other law; preapplication authorization; definitions

A. This article and articles 2 through 5 of this chapter apply to all agencies and all proceedings not expressly exempted.

B. This chapter creates only procedural rights and imposes only procedural duties. They are in addition to those created and imposed by other statutes. To the extent that any other statute would diminish a right created or duty imposed by this chapter, the other statute is superseded by this chapter, unless the other statute expressly provides otherwise.

C. An agency may grant procedural rights to persons in addition to those conferred by this chapter so long as rights conferred on other persons by any provision of law are not substantially prejudiced.

D. Unless specifically authorized by statute, an agency shall avoid duplication of other laws that do not enhance regulatory clarity and shall avoid dual permitting to the extent practicable.

E. Unless specifically authorized by statute, an agency may not require preapplication authorization or require preapplication conferences as a requirement to filing an application that is otherwise allowed by statute. If preapplication procedures are required by statute, an agency shall consider the preapplication requirements or procedures as the beginning of the licensing time frame for the purposes of article 7.1 of this chapter. An agency may offer voluntary preapplication procedures without specific statutory authority if the agency communicates to an applicant that the preapplication procedures are not mandatory. If preapplication procedures are offered by an agency, the agency shall consider the costs and delays that may be imposed on an applicant and shall seek to minimize those impacts.

F. Unless authorized by federal or state law, an agency may not take any action that materially increases the regulatory burdens on a business unless there is a threat to the health, safety and welfare of the public that has not been addressed by legislation or industry regulation within the proposed regulated field.

G. Unless authorized by federal or state law, an agency may not apply a regulation to a qualified marketplace platform if the purpose of that regulation is to regulate a business that provides goods or services directly to the customer.

H. For the purposes of this section:

"Qualified marketplace contractor" means any person or organization, including an individual, corporation, limited liability company, partnership, sole proprietor or other entity, that enters into an agreement with a qualified marketplace platform to use the qualified marketplace platform's digital platform to provide goods or services to third-party individuals or entities seeking those services.
"Qualified marketplace platform" means an organization, including a corporation, limited liability company, partnership, sole proprietor or any other entity, that operates a digital platform that facilitates the provision of goods or services by qualified marketplace contractors to third-party individuals or entities seeking those goods or services.

§ 41-1002.01 Educational programs; enrollment limit prohibited; definition

A. An agency may not limit enrollment in any school or educational program of an institution of higher education.

B. For the purposes of this section, "agency" has the same meaning prescribed in section 41-1001 but does not include the Arizona board of regents or any community college district board.

§ 41-1003 Required rule making

Each agency shall make rules of practice setting forth the nature and requirements of all formal procedures available to the public.

§ 41-1004 Waiver

Except to the extent precluded by another provision of law, a person may waive any right conferred on that person by this chapter.

§ 41-1005 Exemptions

A. This chapter does not apply to any:

Rule that relates to the use of public works, including streets and highways, under the jurisdiction of an agency if the effect of the order is indicated to the public by means of signs or signals.
Order or rule of the Arizona game and fish commission that does the following:

(a) Opens, closes or alters seasons or establishes bag or possession limits for wildlife.

(b) Establishes a fee pursuant to section 5-321, 5-322 or 5-327.

(d) Limits the number or use of licenses or permits that are issued to nonresidents pursuant to section 17-332.

Rule relating to section 28-641 or to any rule regulating motor vehicle operation that relates to speed, parking, standing, stopping or passing enacted pursuant to title 28, chapter 3.
Rule concerning only the internal management of an agency that does not directly and substantially affect the procedural or substantive rights or duties of any segment of the public.
Rule that only establishes specific prices to be charged for particular goods or services sold by an agency.
Rule concerning only the physical servicing, maintenance or care of agency owned or operated facilities or property.
Rule or substantive policy statement concerning inmates or committed youths of a correctional or detention facility in secure custody or patients admitted to a hospital if made by the state department of corrections, the department of juvenile corrections, the board of executive clemency or the department of health services or a facility or hospital under the jurisdiction of the state department of corrections, the department of juvenile corrections or the department of health services.
Form whose contents or substantive requirements are prescribed by rule or statute and instructions for the execution or use of the form.
Capped fee-for-service schedule adopted by the Arizona health care cost containment system administration pursuant to title 36, chapter 29.
Fees prescribed by section 6-125.
Order of the director of water resources adopting or modifying a management plan pursuant to title 45, chapter 2, article 9.
Fees established under section 3-1086.
Fees established under sections 41-4010 and 41-4042.
Rule or other matter relating to agency contracts.
Fees established under section 32-2067 or 32-2132.
Rules made pursuant to section 5-111, subsection A.
Rules made by the Arizona state parks board concerning the operation of the Tonto natural bridge state park, the facilities located in the Tonto natural bridge state park and the entrance fees to the Tonto natural bridge state park.
Fees or charges established under section 41-511.05.
Emergency medical services protocols except as provided in section 36-2205, subsection B.
Fee schedules established pursuant to section 36-3409.
Procedures of the state transportation board as prescribed in section 28-7048.
Rules made by the state department of corrections.
Fees prescribed pursuant to section 32-1527.
Rules made by the department of economic security pursuant to section 46-805.
Schedule of fees prescribed by section 23-908.
Procedure that is established pursuant to title 23, chapter 6, article 6.
Rules, administrative policies, procedures and guidelines adopted for any purpose by the Arizona commerce authority pursuant to chapter 10 of this title if the authority provides, as appropriate under the circumstances, for notice of an opportunity for comment on the proposed rules, administrative policies, procedures and guidelines.
Rules made by a marketing commission or marketing committee pursuant to section 3-414.
Administration of public assistance program monies authorized for liabilities that are incurred for disasters declared pursuant to sections 26-303 and 35-192.
User charges, tolls, fares, rents, advertising and sponsorship charges, services charges or similar charges established pursuant to section 28-7705.
Administration and implementation of the hospital assessment pursuant to section 36-2901.08, except that the Arizona health care cost containment system administration must provide notice and an opportunity for public comment at least thirty days before establishing or implementing the administration of the assessment.
Rules made by the Arizona department of agriculture to adopt and implement the provisions of the federal milk ordinance as prescribed by section 3-605.
Rules made by the Arizona department of agriculture to adopt, implement and administer the United States food and drug administration produce safety rule (21 Code of Federal Regulations part 112) and any other federal produce safety regulation, order or guideline or other requirement adopted pursuant to the FDA food safety modernization act (P.L. 111-353; 21 United States Code sections 2201 through 2252) as provided by title 3, chapter 3, article 4.1.
Calculations that are performed by the department of economic security and that are associated with the adjustment of the sliding fee scale and formula for determining child care assistance pursuant to section 46-805.
Rules made by the Arizona department of agriculture to implement and administer the livestock operator fire and flood assistance grant program established by section 3-109.03.

B. Notwithstanding subsection A, paragraph 21 of this section, if the federal highway administration authorizes the privatization of rest areas, the state transportation board shall make rules governing the lease or license by the department of transportation to a private entity for the purposes of privatization of a rest area.

C. Coincident with the making of a final rule pursuant to an exemption from the applicability of this chapter under this section, another statute or session law, the agency shall:

Prepare a notice and follow formatting guidelines prescribed by the secretary of state.
Prepare the rulemaking exemption notices pursuant to chapter 6.2 of this title.
File a copy of the rule with the secretary of state for publication pursuant to section 41-1012 and provide a copy to the council.

D. Unless otherwise required by law, articles 2, 3, 4 and 5 of this chapter do not apply to the Arizona board of regents and the institutions under its jurisdiction, except that the Arizona board of regents shall make policies or rules for the board and the institutions under its jurisdiction that provide, as appropriate under the circumstances, for notice of and opportunity for comment on the policies or rules proposed.

E. Unless otherwise required by law, articles 2, 3, 4 and 5 of this chapter do not apply to the Arizona state schools for the deaf and the blind, except that the board of directors of all the state schools for the deaf and the blind shall adopt policies for the board and the schools under its jurisdiction that provide, as appropriate under the circumstances, for notice of and opportunity for comment on the policies proposed for adoption.

F. Unless otherwise required by law, articles 2, 3, 4 and 5 of this chapter do not apply to the state board of education, except that the state board of education shall adopt policies or rules for the board and the institutions under its jurisdiction that provide, as appropriate under the circumstances, for notice of and opportunity for comment on the policies or rules proposed for adoption. In order to implement or change any rule, the state board of education shall provide at least two opportunities for public comment. The state board of education shall consider the fiscal impact of any proposed rule pursuant to this subsection.

G. Unless otherwise required by law, articles 2, 3, 4 and 5 of this chapter do not apply to the state board for charter schools, except that the board shall adopt policies or rules for the board and the charter schools sponsored by the board that provide, as appropriate under the circumstances, for notice of and opportunity for comment on the policies or rules proposed for adoption. In order to implement or change any policy or rule, the board shall provide at least two opportunities for public comment. The state board for charter schools shall consider the fiscal impact of any proposed rule pursuant to this subsection.

§ 41-1006 Employees providing agency assistance; identification and publication

A. Each state agency shall publish annually in the register, in the state directory and in a telephone directory for Maricopa county the name or names of those employees who are designated by the agency to assist members of the public or regulated community in seeking information or assistance from the agency.

B. In any written communication between a state agency and a person, the state agency shall provide the name, telephone number and email address of the employee who is authorized and able to provide information about the communication if the communication does any of the following:

Demands payment of a tax, fee, penalty, fine or assessment.
Denies an application for a permit or license that is issued by the state agency.
Requests corrections, revisions or additional information or materials needed for approval of any application for a permit, license or other authorization that is issued by the state agency.

C. An employee who is authorized and able to provide information about any communication that is described in subsection B of this section shall reply within five business days after the state agency receives that communication.

§ 41-1007 Award of costs and fees against a department in administrative hearings; exceptions; definitions

A. Except as provided in section 32-3632 and section 42-2064, subsection F, a hearing officer or administrative law judge shall award fees and other costs to any prevailing party in a contested case or an appealable agency action brought pursuant to any state administrative hearing authority. For purposes of this subsection, a person is considered to be a prevailing party only if both:

The agency's position was not substantially justified.
The person prevails as to the most significant issue or set of issues unless the reason that the person prevailed is due to an intervening change in the law.

B. Reimbursement under this section may be denied if during the course of the proceeding the party unduly and unreasonably protracted the final resolution of the matter.

C. A party that seeks an award of fees or other costs shall apply to the hearing officer or administrative law judge, within thirty days after the final decision or order, providing:

Evidence of the party's eligibility for the award.
The amount sought.
An itemized statement from the attorneys and experts stating:

(a) The actual time spent representing the party.

(b) The rate at which the fees were computed.

D. The award of reasonable attorney fees pursuant to subsection A of this section need not equal or relate to the attorney fees actually paid or contracted, but an award may not exceed the amount paid or agreed to be paid.

E. A decision of a hearing officer or administrative law judge under this section is subject to judicial review. If fees and other costs were denied by the hearing officer or administrative law judge because the party was not the prevailing party but the party prevails on appeal, the court may award fees and other costs for the proceedings before the hearing officer or administrative law judge if the court finds that fees and other costs should have been awarded under subsection A of this section.

F. The department shall pay the fees and costs awarded pursuant to this section from any monies appropriated to the department and available for that purpose, or from other operating costs of the department. If the department fails or refuses to pay the award within thirty days after the demand, and if no further review or appeals of the award are pending, the person may file a claim for the award with the department of administration which shall pay the claim within thirty days in the same manner as an uninsured property loss under chapter 3.1, article 1 of this title, except that the department shall be responsible for the total amount awarded and shall pay it from operating monies. If the department had appropriated monies available for paying the award at the time it failed or refused to pay, the legislature shall reduce the department's operating appropriation for the following fiscal year by the amount of the award and appropriate that amount to the department of administration as reimbursement for the loss.

G. This section does not apply to:

Any grievance and appeal procedure pursuant to title 36, chapter 29.
Any appeal procedure pursuant to chapter 4, article 6 of this title.
Any administrative appeal filed by an inmate in an Arizona state prison.

H. For the purposes of this section:

"Department" includes a state agency, department, board or commission, and the universities.
"Party" includes an individual, partnership, corporation, limited liability company, limited liability partnership, association and public or private organization.

§ 41-1008 Fees; specific statutory authority

A. Except as provided in subsection C of this section, an agency shall not:

Charge or receive a fee or make a rule establishing a fee unless the fee for the specific activity is expressly authorized by statute or tribal state gaming compact.
Make a rule establishing a fee that is solely based on a statute that generally authorizes an agency to recover its costs or to accept gifts or donations.
Increase a fee in an amount that exceeds the percentage of change in the average consumer price index as published by the United States department of labor, bureau of labor statistics between that figure for the latest calendar year and the calendar year in which the last fee increase occurred. An agency may increase a fee in an amount that exceeds the percentage of change in the average consumer price index if either of the following applies:

(a) The agency submits the fee increase to the joint legislative budget committee for review before the fee is increased.

(b) The agency is required to submit an annual report that includes information about the fee to members of the legislature.

B. An agency shall identify the statute or tribal state gaming compact that authorizes the fee on documents relating to collection of the fee.

C. An agency authorized by statute or tribal state gaming compact to conduct background checks may charge a fingerprint fee without a statute expressly authorizing the fee.

D. Unless the legislature grants an express exemption through statute or session law from all requirements of this chapter for establishing or increasing a fee, an agency shall comply with all applicable rule making provisions to establish or increase the fee. The agency shall not charge or receive the fee until the rule establishing or increasing the fee is effective under the applicable law of this state.

E. A fee that is established or increased by exempt rule making from and after September 30, 2012 is effective for two years unless an extension is granted by the council.

F. After the expiration of the applicable period under subsection E of this section, the agency shall not charge or receive the fee unless the agency has complied with the rule making requirements of this chapter to establish or increase the fee.

G. A person regulated by the rule may petition the council to establish a date that is different than the date under subsection E of this section but no earlier than two years after the exempt rule is made. The agency shall respond to the petition within two weeks after the council notifies the agency that the petition has been filed. Within sixty days the council shall grant or deny the petition after considering whether the public interest requires a different date.

§ 41-1009 Inspections and audits; applicability; exceptions

A. An agency inspector, auditor or regulator who enters any premises of a regulated person for the purpose of conducting an inspection or audit shall, unless otherwise provided by law:

Present photo identification on entry of the premises.
On initiation of the inspection or audit, state the purpose of the inspection or audit and the legal authority for conducting the inspection or audit.
Disclose any applicable inspection or audit fees. Notwithstanding any other law, a regulated person being inspected or audited is responsible for only the direct and reasonable costs of the inspection or audit and is entitled to receive a detailed billing statement as described in paragraph 5, subdivision (e) of this subsection.
Afford an opportunity to have an authorized on-site representative of the regulated person accompany the agency inspector, auditor or regulator on the premises, except during confidential interviews.
Provide notice of the right to have on request:

(a) Copies of any original documents taken by the agency during the inspection or audit if the agency is allowed by law to take original documents.

(b) A split of any samples taken during the inspection if the split of any samples would not prohibit an analysis from being conducted or render an analysis inconclusive.

(d) Copies of any documents to be relied on to determine compliance with licensure or regulatory requirements if the agency is otherwise allowed by law to do so.

(e) A detailed billing statement that provides reasonable specificity of the inspection or audit fees imposed pursuant to paragraph 3 of this subsection and that cites the statute or rule that authorizes the fees being charged.

Inform each person whose conversation with the agency inspector, auditor or regulator during the inspection or audit is tape recorded that the conversation is being tape recorded.
Inform each person who is interviewed during the inspection or audit that:

(a) Statements made by the person may be included in the inspection or audit report.

(b) Participation in an interview is voluntary, unless the person is legally compelled to participate in the interview.

(c) The person is allowed at least twenty-four hours to review and revise any written witness statement that is drafted by the agency inspector, auditor or regulator and on which the agency inspector, auditor or regulator requests the person's signature.

(d) The agency inspector, auditor or regulator may not prohibit the regulated person from having an attorney or any other experts in their field present during the interview to represent or advise the regulated person.

At the end of the inspection, offer to review, with an authorized representative of the regulated person, the findings of the inspection and what agency actions the regulated person can expect.

B. On initiation of an audit or an inspection of any premises of a regulated person, an agency inspector, auditor or regulator shall provide the following in writing:

The rights described in subsection A of this section and section 41-1001.01, subsection C.
The name and telephone number of a contact person who is available to answer questions regarding the inspection or audit.
The due process rights relating to an appeal of a final decision of an agency based on the results of the inspection or audit, including the name and telephone number of a person to contact within the agency and any appropriate state government ombudsman.
A statement that the agency inspector, auditor or regulator may not take any adverse action, treat the regulated person less favorably or draw any inference as a result of the regulated person's decision to be represented by an attorney or advised by any other experts in their field.
A notice that if the information and documents provided to the agency inspector, auditor or regulator become a public record, the regulated person may redact trade secrets and proprietary and confidential information unless the information and documents are confidential pursuant to statute.
The time limit or statute of limitations applicable to the right of the agency inspector, auditor or regulator to file a compliance action against the regulated person arising from the inspection or audit, which applies to both new and amended compliance actions.

C. An agency inspector, auditor or regulator shall obtain the signature of the regulated person or on-site representative of the regulated person on the writing prescribed in subsection B of this section and section 41-1001.01, subsection C, if applicable, indicating that the regulated person or on-site representative of the regulated person has read the writing prescribed in subsection B of this section and section 41-1001.01, subsection C, if applicable, and is notified of the regulated person's or on-site representative of the regulated person's inspection or audit and due process rights. The agency inspector, auditor or regulator may provide an electronic document of the writing prescribed in subsection B of this section and section 41-1001.01, subsection C and, at the request of the regulated person or on-site representative, obtain a receipt in the form of an electronic signature. The agency shall maintain a copy of this signature with the inspection or audit report and shall leave a copy with the regulated person or on-site representative of the regulated person. If a regulated person or on-site representative of the regulated person is not at the site or refuses to sign the writing prescribed in subsection B of this section and section 41-1001.01, subsection C, if applicable, the agency inspector, auditor or regulator shall note that fact on the writing prescribed in subsection B of this section and section 41-1001.01, subsection C, if applicable.

D. An agency that conducts an inspection shall give a copy of the inspection report to the regulated person or on-site representative of the regulated person either:

At the time of the inspection.
Notwithstanding any other state law, within thirty working days after the inspection.
As otherwise required by federal law.

E. The inspection report shall contain alleged deficiencies identified during an inspection. Unless otherwise provided by state or federal law, the agency shall provide the regulated person an opportunity to correct the alleged deficiencies unless the agency documents in writing as part of the inspection report that the alleged deficiencies are:

Committed intentionally.
Not correctable within a reasonable period of time as determined by the agency.
Evidence of a pattern of noncompliance as demonstrated by alleged deficiencies previously identified in an inspection report or other written notice at the same premises.
A significant risk to any person, the public health, safety or welfare or the environment.

F. If the agency is unsure whether a regulated person meets the exemptions in subsection E of this section, the agency shall provide the regulated person with an opportunity to correct the alleged deficiencies.

G. If the agency allows the regulated person an opportunity to correct the alleged deficiencies pursuant to subsection E of this section, the regulated person shall notify the agency when the alleged deficiencies have been corrected. Within thirty days after receipt of notification from the regulated person that the alleged deficiencies have been corrected, the agency shall determine if the regulated person is in substantial compliance and notify the regulated person whether or not the regulated person is in substantial compliance. If the regulated person fails to correct the alleged deficiencies or the agency determines the alleged deficiencies have not been corrected within a reasonable period of time, the agency may take any enforcement action authorized by law for the alleged deficiencies.

H. If the agency does not allow the regulated person an opportunity to correct alleged deficiencies pursuant to subsection E of this section, on the request of the regulated person, the agency shall provide a detailed written explanation of the reason that an opportunity to correct was not allowed.

I. An agency decision pursuant to subsection E or G of this section is not an appealable agency action.

J. At least once every month after the commencement of the inspection, an agency shall provide a regulated person with an update on the status of any agency action resulting from an inspection of the regulated person. An agency is not required to provide an update after the regulated person is notified that no agency action will result from the agency inspection or after the completion of agency action resulting from the agency inspection.

K. For agencies with authority under title 49, if, as a result of an inspection or any other investigation, an agency alleges that a regulated person is not in compliance with licensure or other applicable regulatory requirements, the agency shall provide written notice of that allegation to the regulated person. The notice shall contain the following information:

A citation to the statute, regulation, license or permit condition on which the allegation of deficiency is based, including the specific provisions in the statute, regulation, license or permit condition that are alleged to be violated.
Identification of any documents relied on when determining the allegation of deficiency.
An explanation stated with reasonable specificity of the regulatory and factual basis for the allegation of deficiency.
Instructions for obtaining a timely opportunity to discuss the alleged deficiencies with the agency.

L. Subsection K of this section applies only to inspections or any other investigations necessary for the issuance of a license or to determine compliance with licensure or other regulatory requirements. Subsection K of this section does not apply to an action taken pursuant to section 11-871, 11-876, 11-877, 49-457.01, 49-457.03 or 49-474.01. Issuance of a notice under subsection K of this section is not a prerequisite to otherwise lawful agency actions seeking an injunction or issuing an order if the agency determines that the action is necessary on an expedited basis to abate an imminent and substantial endangerment to public health or the environment and documents the basis for that determination in the documents initiating the action.

M. This section does not authorize an inspection or any other act that is not otherwise authorized by law.

N. Except as otherwise provided in subsection L of this section, this section applies only to inspections necessary for the issuance of a license or to determine compliance with licensure or other regulatory requirements applicable to a licensee and audits pursuant to enforcement of title 23, chapters 2 and 4. This section does not apply:

To criminal investigations, investigations under tribal state gaming compacts and undercover investigations that are generally or specifically authorized by law.
If the agency inspector, auditor or regulator has reasonable suspicion to believe that the regulated person may be engaged in criminal activity.
To the Arizona peace officer standards and training board established by section 41-1821.
To certificates of convenience and necessity that are issued by the corporation commission pursuant to title 40, chapter 2.

O. If an agency inspector, auditor or regulator gathers evidence in violation of this section, the violation may be a basis to exclude the evidence in a civil or administrative proceeding.

P. Failure of an agency, board or commission employee to comply with this section:

May subject the employee to disciplinary action or dismissal.
Shall be considered by the judge and administrative law judge as grounds for reduction of any fine or civil penalty.

Q. An agency may make rules to implement subsection A, paragraph 5 of this section.

R. Nothing in this section shall be used to exclude evidence in a criminal proceeding.

S. Subsection A, paragraph 7, subdivision (c) and subsection E of this section do not apply to the department of health services for the purposes of title 36, chapters 4 and 7.1.

T. Subsection B, paragraph 5 and subsection E of this section do not apply to the corporation commission for the purposes of title 44, chapters 12 and 13.

U. Except as otherwise prescribed by this section and notwithstanding any other law:

This section applies to all state agencies that conduct inspections and audits.
If a conflict arises between the rights afforded a regulated person pursuant to this section and the rights afforded a regulated person pursuant to another statute, this section governs.

§ 41-1010 Complaints; public record

Notwithstanding any other law, a person shall disclose the person's name during the course of reporting an alleged violation of law or rule. During the course of an investigation or enforcement action, the name of the complainant shall be a public record unless the affected agency determines that the release of the complainant's name may result in substantial harm to any person or to the public health or safety.

§ 41-1010.01 Proper venue; appeals of final administrative decisions

A. A party that appeals a final administrative decision to the superior court may bring the action in any proper venue.

B. Unless otherwise provided by statute, the proper venue may include any of the following:

The county where the plaintiff, claimant or appellant resides.
The county where the plaintiff's, claimant's or appellant's principal place of business is located.
The county where the agency is headquartered.
Maricopa county.

C. Unless otherwise provided by statute, an agency may not do either of the following:

Restrict the proper venue for any appeal of a final administrative decision.
Require a party to travel to the agency's county, venue or headquarters to submit or receive documentation that supports the analysis used to propose or finalize a final administrative decision.

D. Pursuant to section 12-905, if the proper venue for an action to review a final administrative decision is expressly prescribed by statute, such venue shall control.

Article 2 Publication of Agency Rules

§ 41-1011 Preparation and publication of code and register

A. The secretary of state shall prepare and publish the code and register.

B. The secretary of state shall prescribe a uniform numbering system and have reasonable discretion to determine the form and style for rules filed with and published by the office. The secretary of state shall refuse to accept a rule notice or other notice filing if the notice or filing does not comply with the secretary of state's prescribed filing requirements, numbering system, form and style.

C. The secretary of state shall assign titles and chapters to agencies and prepare, arrange and correlate rules and other text as necessary when publishing the code and register. The secretary of state may not alter the sense, meaning or effect of any rule but may renumber rules and parts of rules, rearrange rules, change reference numbers to agree with renumbered rules and parts of rules, substitute the proper rule number for "the preceding rule" and similar terms, delete figures if they are merely a repetition of written words, change capitalization for the purpose of uniformity and correct manifest clerical or typographical errors. With the consent of the attorney general, the secretary of state may remove from the code a provision of a rule that a court of final appeal declares unconstitutional or otherwise invalid and a rule made by an agency that is abolished if the rule is not transferred to a successor agency. The secretary of state shall remove a rule from the code when notified by the governor's regulatory review council that the rule has expired pursuant to section 41-1056, subsection J.

§ 41-1012 Code; publication of rules; notification

A. The code shall contain the full text of each final, expedited and emergency rule filed with the secretary of state and each exempt rule filed with the secretary of state to be published pursuant to a statutory exemption from the applicability of this chapter. The secretary of state shall remove each expired rule as prescribed in section 41-1011, subsection C.

B. The secretary of state shall electronically publish at least once every quarter a code supplement. Publication of a rule by the secretary of state as provided in this section constitutes prima facie evidence of the making, approving and filing of a final, emergency or exempt rule pursuant to this chapter or a statutory exemption from the applicability of this chapter.

C. The secretary of state shall offer an e-mail service for persons to receive notification when a quarterly supplement has been published. The service shall include a list of chapters published and where the chapters are posted.

D. The secretary of state shall publish the code electronically for free. The secretary of state shall establish a commercial use fee pursuant to section 39-121.03. The secretary of state shall honor any paper subscription in place by the end of fiscal year 2017-2018 until the subscription expires.

§ 41-1013 Register

A. The secretary of state shall electronically publish the register at least once each month and include the contents listed under subsection B of this section. The secretary of state shall publish the notices that are filed with the secretary of state during the preceding thirty days. The register shall include a table of contents and a cumulative index.

B. The register shall contain the following:

Notices of rulemaking docket openings, including the subject matter of the rules under consideration.
Notices of proposed rulemaking.
Notices of supplemental proposed rulemaking.
Notices of proposed exempt rulemaking for agencies that are exempt from the requirements of chapter 6 of this title but that are required to publish the notice in the register.
Notices of oral proceedings if the oral proceeding was not listed in the notice of rulemaking docket opening as provided in section 41-1021, subsection B, paragraph 5.
Notices of final exempt rulemaking for agencies that are exempt from the requirements of chapter 6 of this title. For the purposes of this paragraph, "final exempt rulemaking" means rulemaking in which an agency received public comment on the rulemaking regardless of whether the proposed rulemaking was published in the register or elsewhere by the agency as required in the exemption.
Notices of exempt rulemaking for agencies that have a onetime exemption from the requirements of chapter 6 of this title or that are exempt pursuant to section 41-1005. For the purposes of this paragraph, "exempt rulemaking" means a rulemaking in which an agency did not publish a notice of proposed rulemaking and the agency was not required to conduct a public hearing or receive public comments.
Proposed and final notices of expedited rulemaking and notices that an objection was received regarding a proposed expedited rulemaking.
Notices of an agency substantive policy statement. The notice of a substantive policy statement shall contain the name and summary of the policy statement and the website address where the full text of the document is available, if practicable.
Notices of intent to increase state museum fees pursuant to section 15-1631.
Notices of actions taken by the governor's regulatory review council.
Notices of an agency guidance document or revisions to a guidance document. This notice shall contain the name and a summary of the guidance document and information where a person may view the document in its entirety.
Notices of each agency ombudsman pursuant to section 41-1006.
Notices of public information that pertain to rulemaking notices.
Deadlines of the governor's regulatory review council.

C. All notices listed in subsection B of this section, except the notices under subsection B, paragraphs 1, 5, 9, 10, 11, 12, 13, 14 and 15 of this section, must include a preamble and the full text of the rule being proposed, amended, renumbered or repealed.

D. The register shall be published electronically for free. The secretary of state shall establish a commercial-use fee pursuant to section 39-121.03. Any paper subscription in place at the end of fiscal year 2016-2017 shall be honored until the subscription expires.

E. For the purposes of this section, full text publication in the register includes new, amended, renumbered, repealed and existing language that an agency deems necessary for the proper understanding of a rule notice. Rules that are undergoing extensive revision may be reprinted in whole. Existing rule language that is not required for understanding shall be omitted and marked "no change".

§ 41-1014 Department of child safety; final rules

The secretary of state shall publish on its website any final rule of the department of child safety within ten days after the final rule is filed with the secretary of state.

Article 3 Rulemaking

§ 41-1021 Public rule making docket; notice

A. Each agency shall establish and maintain a current, public rule making docket for each pending rule making proceeding. A rule making proceeding is pending from the time the agency begins to consider proposing the rule under section 41-1022 until any one of the following occurs:

The time the rule making proceeding is terminated by the agency indicating in the rule making docket that the agency is no longer actively considering proposing the rule.
One year after the notice of rule making docket opening is published in the register if the agency has not filed a notice of the proposed rule making with the secretary of state pursuant to section 41-1022.
The rule becomes effective.
One year after the notice of the proposed rule making is published in the register if the agency has not submitted the rule to the council for review and approval.
Publication of a notice of termination.

B. For each rule making proceeding, the docket shall indicate all of the following:

The subject matter of the proposed rule.
A citation to all published notices relating to the proceeding.
The name and address of agency personnel with whom persons may communicate regarding the rule.
Where written submissions on the proposed rule may be inspected.
The time during which written submissions may be made and the time and place where oral comments may be made.
Where a copy of the economic, small business and consumer impact statement and the minutes of the pertinent council meeting may be inspected.
The current status of the proposed rule.
Any known timetable for agency decisions or other action in the proceeding.
The date the rule was sent to the council.
The date of the rule's filing and publication.
The date the rule was approved by the council.
When the rule will become effective.

C. The agency shall provide public notice of the establishment of a rule making docket by causing a notice of docket opening to be published in the register, including the information set forth in subsection B, paragraphs 1, 2, 3, 5 and 8 of this section.

D. An agency may appoint formal advisory committees to comment, before publication of a notice of proposed rule making under section 41-1022, on the subject matter of a possible rule making under active consideration within the agency. The membership of these committees shall be published at the time of formation and annually thereafter in the register. Members of these committees are not eligible to receive compensation except as otherwise provided by law.

§ 41-1021.01 Permissive examples

An agency may include a diagram, example, table, chart or formula in a rule, preamble, economic impact, small business and consumer impact statement or concise explanatory statement to the extent that it assists in making the document understandable by the persons affected by the rule.

§ 41-1021.02 State agencies; annual regulatory agenda

A. On or before December 1 of each year, each agency, except for a self-supporting regulatory board as defined in section 41-1092, shall prepare and make available to the public the regulatory agenda that the agency expects to follow during the next calendar year.

B. The regulatory agenda shall include all of the following:

A notice of docket openings.
A notice of any proposed rule making, including potential sources of federal funding for each proposed rule making.
A review of existing rules.
A notice of a final rule making.

C. The regulatory agenda shall also provide for the following information:

Any rule making terminated during the current calendar year.
Any privatization option and nontraditional regulatory approach being considered by the agency.

D. This section does not prohibit an agency from undertaking any rule making action even if that action has not been included in the agency's annual regulatory agenda.

§ 41-1022 Notice of proposed rulemaking; contents of notice

A. An agency shall prepare a notice of proposed rulemaking to make, amend, renumber or repeal a rule. The agency shall follow formatting guidelines prescribed by the secretary of state in the preparation of the notice. The agency shall file the notice with the secretary of state. The notice shall include all of the following:

The preamble.
The code chapter and article in which the rule is being proposed.
The proposed or current rule section number.
The exact wording of the rule, including the full text of a new rule and any amendment to, renumbering of or repeal of a current rule.

B. The secretary of state shall publish the notice in the register pursuant to section 41-1013.

C. When the agency files the notice, the agency shall notify by first class mail, fax or e-mail each person who has requested notification of the proposed rulemaking and each person who has requested notification of all proposed rulemakings. An agency may provide the notification prescribed in this subsection in a periodic agency newsletter. An agency may purge its list of persons requesting notification of proposed rulemakings once each year.

D. An agency shall allow for and accept public comment on the proposed rulemaking as prescribed in section 41-1023, subsection B. If the proposed rulemaking is exempt from the rulemaking requirements, the agency shall allow for and accept public comment as provided under the exemption.

E. If, as a result of public comments or internal review, an agency determines that a proposed rule requires a substantial change pursuant to section 41-1025, the agency shall prepare a notice of supplemental rulemaking that contains the change in the proposed rule. The agency shall provide for additional public comment pursuant to section 41-1023 and file the notice with the secretary of state. The secretary of state shall publish the notice in the register pursuant to section 41-1013.

§ 41-1023 Public participation; written statements; oral proceedings

A. After providing notice of docket openings, an agency may meet informally with any interested party for the purpose of discussing the proposed rule making action. The agency may solicit comments, suggested language or other input on the proposed rule. The agency may publish notice of these meetings in the register.

B. For at least thirty days after publication of the notice of the proposed rule making, an agency shall afford persons the opportunity to submit in writing statements, arguments, data and views on the proposed rule, with or without the opportunity to present them orally.

C. An agency shall schedule an oral proceeding on a proposed rule if, within thirty days after the published notice of proposed rule making, a written request for an oral proceeding is submitted to the agency personnel listed pursuant to section 41-1021, subsection B.

D. An oral proceeding on a proposed rule may not be held earlier than thirty days after notice of its location and time is published in the register. The agency shall determine a location and time for the oral proceeding which affords a reasonable opportunity to persons to participate. The oral proceeding shall be conducted in a manner that allows for adequate discussion of the substance and the form of the proposed rule, and persons may ask questions regarding the proposed rule and present oral argument, data and views on the proposed rule.

E. The agency, a member of the agency or another presiding officer designated by the agency shall preside at an oral proceeding on a proposed rule. If the agency does not preside, the presiding official shall prepare a memorandum for consideration by the agency summarizing the contents of the presentations made at the oral proceeding. Oral proceedings must be open to the public and recorded by stenographic or other means.

F. Each agency may make rules for the conduct of oral rule making proceedings. Those rules may include provisions calculated to prevent undue repetition in the oral proceedings.

§ 41-1024 Time and manner of rule making

A. An agency may not submit a rule to the council until the rule making record is closed.

B. Within one hundred twenty days after the close of the record on the proposed rule making, an agency shall take one of the following actions:

Submit the rule to the council or, if the rule is exempt pursuant to section 41-1057, to the attorney general.
Terminate the proceeding by publication of a notice to that effect in the register.

C. Before submitting a rule to the council or the attorney general, an agency shall consider the written submissions, the oral submissions or any memorandum summarizing oral submissions and the economic, small business and consumer impact statement regarding the rule or information in the preamble.

D. Within the scope of its delegated authority, an agency may use its own experience, technical competence, specialized knowledge and judgment in the making of a rule.

E. Unless exempted by section 41-1005 or 41-1057 or unless the rule is an emergency rule made pursuant to section 41-1026, if the agency chooses to make the rule, the agency shall submit a rule package to the council and to the committee. The rule package shall include:

The preamble.
The exact words of the rule, including existing language and any deletions.
The economic, small business and consumer impact statement.

F. If the rule is exempt pursuant to section 41-1005, the agency shall file it as a final rule with the secretary of state.

G. If the rule is exempt from council approval, pursuant to section 41-1057, the agency shall submit the rule package set forth in subsection E of this section to the attorney general for approval pursuant to section 41-1044.

H. An agency shall not file a final rule with the secretary of state without prior approval from the council, unless the final rule is exempted pursuant to section 41-1005 or 41-1057 or the rule is an emergency rule made pursuant to section 41-1026 or an expedited rule made pursuant to section 41-1027.

§ 41-1025 Variance between rule and published notice of proposed rule

A. An agency may not submit a rule to the council that is substantially different from the proposed rule contained in the notice of proposed rule making or a supplemental notice filed with the secretary of state pursuant to section 41-1022. However, an agency may terminate a rule making proceeding and commence a new rule making proceeding for the purpose of making a substantially different rule.

B. In determining whether a rule is substantially different from the published proposed rule on which it is required to be based, all of the following must be considered:

The extent to which all persons affected by the rule should have understood that the published proposed rule would affect their interests.
The extent to which the subject matter of the rule or the issues determined by that rule are different from the subject matter or issues involved in the published proposed rule.
The extent to which the effects of the rule differ from the effects of the published proposed rule if it had been made instead.

§ 41-1026 Emergency rulemaking

A. If an agency makes a finding that a rule is necessary as an emergency measure, the rule may be made, amended or repealed as an emergency measure, without the notice prescribed by sections 41-1021 and 41-1022 and prior review by the council, if the rule is first approved by the attorney general and filed with the secretary of state. The attorney general may not approve the making, amendment or repeal of a rule as an emergency measure if the emergency situation is created due to the agency's delay or inaction and the emergency situation could have been averted by timely compliance with the notice and public participation provisions of this chapter, unless the agency submits substantial evidence that the rule is necessary as an emergency measure to do any of the following:

Protect the public health, safety or welfare.
Comply with deadlines in amendments to an agency's governing law or federal programs.
Avoid violation of federal law or regulation or other state law.
Avoid an imminent budget reduction.
Avoid serious prejudice to the public interest or the interest of the parties concerned.

B. Within sixty days after receipt, the attorney general shall review the demonstration of emergency and the rule in accordance with the standards prescribed in section 41-1044.

C. If the emergency is in accordance with the standards in section 41-1044, the attorney general shall create a certificate of approval and file the rule with the secretary of state. The secretary of state shall publish the rule in the register as provided in section 41-1013 and publish the rule in the code.

D. A rule made, amended or repealed pursuant to this section is valid for one hundred eighty days after the filing of the rule with the secretary of state. The emergency may be renewed for one more one hundred eighty-day period if all of the following requirements are met:

The agency determines that the emergency situation still exists.
The agency follows the procedures prescribed in this section.
The agency files a notice of the renewal of the emergency with the attorney general before the expiration of the preceding one hundred eighty-day period.
The agency makes the rule as a proposed rule or has issued an alternative proposed rule pursuant to section 41-1022.
The agency receives approval of the renewal from the attorney general before the expiration of the preceding one hundred eighty-day period.
The attorney general creates a certificate of approval and files the rule with the secretary of state. The secretary of state shall publish the renewal of the emergency rule in the register as provided in section 41-1013 and publish the rule in the code.

E. A rule that is made pursuant to this chapter shall repeal an emergency rule made, amended or repealed if the emergency is still effective within the one hundred eighty-day period.

F. On expiration of the one hundred eighty-day period, the secretary of state shall remove the emergency rule from the code. If a rule has not been made pursuant to subsection E of this section, the rule in place before the emergency is restored.

§ 41-1026.01 Emergency adoption, amendment or termination of delegation agreements; definition

A. If a delegating agency makes a written finding that a delegation agreement is necessary as an emergency measure, the delegation agreement may be adopted, amended or terminated as an emergency measure, without complying with the public notice and participation provisions of this article. An agency may not adopt, amend or terminate a delegation agreement as an emergency measure if the emergency situation is created due to the agency's delay or inaction and the emergency situation could have been averted by timely compliance with the public notice and participation provisions of this article, unless the agency can present substantial evidence that failure to adopt, amend or terminate the delegation agreement as an emergency measure will result in imminent substantial peril to the public health, safety or welfare.

B. The agency shall file with the secretary of state a summary of the emergency delegation agreement. The summary shall provide the name of the person to contact in the agency with questions or comments. The secretary of state shall publish the summary in the next register.

C. The delegation agreement adopted, amended or terminated pursuant to this section is valid for one hundred eighty days after the filing of the agreement with the secretary of state and may be renewed for one or two more one hundred eighty day periods if all of the following occur:

The agency determines that the emergency situation still exists for each renewal.
The agency follows the procedures prescribed by this section for each renewal.
The agency has begun the public comment and participation process required by this section.
The agency makes a finding for an extension of time before the expiration of the preceding one hundred and eighty day period.
The agency files notice of the renewal with the secretary of state and notice is published in the register.

D. For purposes of this section, "emergency" means a situation which warrants the adoption of a delegation agreement without compliance with the public notice and participation provisions prescribed in this article because the adoption, amendment or termination of the delegation agreement is necessary for immediate preservation of the public health, safety or welfare, and the public notice and participation requirements of this article are impracticable.

§ 41-1027 Expedited rulemaking

A. An agency may conduct expedited rulemaking pursuant to this section if the rulemaking does not increase the cost of regulatory compliance, increase a fee or reduce procedural rights of persons regulated and does one or more of the following:

Amends or repeals rules made obsolete by repeal or supersession of an agency's statutory authority.
Amends or repeals rules for which the statute on which the rule is authorized has been declared unconstitutional by a court with jurisdiction, there is a final judgment and no statute has been enacted to replace the unconstitutional statute.
Corrects typographical errors, makes address or name changes or clarifies language of a rule without changing its effect.
Adopts or incorporates by reference without material change federal statutes or regulations pursuant to section 41-1028, statutes of this state or rules of other agencies of this state.
Reduces or consolidates steps, procedures or processes in the rules.
Amends or repeals rules that are outdated, redundant or otherwise no longer necessary for the operation of state government.
Implements, without material change, a course of action that is proposed in a five-year review report approved by the council pursuant to section 41-1056 within one hundred eighty days of the date that the agency files the proposed expedited rulemaking with the secretary of state.
Adopts, without material change, rules of another agency of this state that has been or imminently will be consolidated into the agency.

B. An agency shall deliver a notice of proposed expedited rulemaking to the governor, the president of the senate, the speaker of the house of representatives, the committee and the council. The notice shall contain the name, address and telephone number of the agency contact person and the exact wording of the proposed expedited rulemaking and indicate how the proposed expedited rulemaking achieves the purpose prescribed in subsection A of this section.

C. On delivery of the notice required in subsection B of this section, the agency shall file the notice of proposed expedited rulemaking with the secretary of state for publication in the next state administrative register. The agency and the council shall post the notice of proposed expedited rulemaking on their respective websites and shall allow any person to provide written comment for at least thirty days after posting the notice. The agency shall adequately respond in writing to the comments on the proposed expedited rulemaking.

D. An agency may not submit a final expedited rule to the council that is substantially different from the proposed rule contained in the notice of proposed expedited rulemaking. However, an agency may terminate an expedited rulemaking proceeding and commence a new rulemaking proceeding for the purpose of making a substantially different rule. An agency shall use the criteria prescribed in section 41-1025, subsection B for determining whether a final expedited rule is substantially different from the proposed expedited rule.

E. After adequately addressing, in writing, any written objections, an agency shall file a request for approval with the council. The request shall contain the notice of final expedited rulemaking and the agency's responses to any written comments. The council may require a representative of an agency whose expedited rulemaking is under examination to attend a council meeting and answer questions. The council may communicate to the agency its comments on the expedited rulemaking within the scope of subsection A of this section and require the agency to respond to its comments or testimony in writing. A person may submit written comments to the council that are within the scope of subsection A of this section.

F. Before an agency files a notice of final expedited rulemaking with the secretary of state, the council shall approve any expedited rulemaking. The council shall not approve the rule unless:

The rule satisfies the criteria for expedited rulemaking pursuant to subsection A of this section.
The rule is clear, concise and understandable.
The rule is not illegal, inconsistent with legislative intent or beyond the agency's statutory authority.
The agency, in writing, adequately addressed the comments on the proposed rule and any supplementary proposal.
If applicable, the permitting requirements comply with section 41-1037.
The rule is not a substantial change, considered as a whole, from the proposed rule and any supplementary proposal.
The rule imposes the least burden and costs to persons regulated by the rule.

G. On receipt of council approval, the agency shall file a notice of final expedited rulemaking and the council's certificate of approval with the secretary of state.

H. The expedited rulemaking becomes effective immediately on the filing of the notice of final expedited rulemaking.

§ 41-1028 Incorporation by reference

A. An agency may incorporate by reference in its rules, and without publishing the incorporated matter in full, all or any part of a code, standard, rule or regulation of an agency of the United States or of this state or a nationally recognized organization or association, if incorporation of its text in agency rules would be unduly cumbersome, expensive or otherwise inexpedient.

B. The reference in the agency rules shall fully identify the incorporated matter by location, date and otherwise and shall state that the rule does not include any later amendments or editions of the incorporated matter.

C. An agency may incorporate by reference such matter in its rules only if the agency, organization or association originally issuing that matter makes copies of it readily available to the public for inspection and reproduction.

D. The rules shall state where copies of the incorporated matter are available from the agency issuing the rule and from the agency of the United States or this state or the organization or association originally issuing the matter.

E. An agency may incorporate later amendments or editions of the incorporated matter only after compliance with the rule making requirements of this chapter.

§ 41-1029 Agency rule making record

A. An agency shall maintain an official rule making record for each rule it proposes by publication in the register of a notice of proposed rule making and each final rule filed in the office of the secretary of state. The record and matter incorporated by reference must be available for public inspection.

B. The agency rule making record shall contain all of the following:

A copy of the notice initially filed in the office of the secretary of state.
Copies of all publications in the register with respect to the rule or the proceeding on which the rule is based.
Copies of any portions of the agency's rule making docket containing entries relating to the rule or the proceeding on which the rule is based.
All written petitions, requests, submissions and comments received by the agency and all other written materials considered or prepared by the agency in connection with the rule or the proceeding on which the rule is based.
Any official transcript of oral presentations made in the proceeding on which the rule is based, or if not transcribed, any tape recording or stenographic record of those presentations, and any memorandum prepared by a presiding official summarizing the contents of those presentations.
A copy of all materials submitted to the council, including the economic, small business and consumer impact statement and the minutes of the council meeting at which the rule was reviewed.
A copy of the final rule and preamble.
Information requested regarding the experience, technical competence, specialized knowledge and judgment of an agency if the agency relies on section 41-1024, subsection D in the making of a rule and a request is made.

C. On judicial review, the record required by this section constitutes the official agency rule making record with respect to a rule. Except as provided in section 41-1036 or otherwise required by a provision of law, the agency rule making record need not constitute the exclusive basis for agency action on that rule or for judicial review of that rule.

§ 41-1030 Invalidity of rules not made according to this chapter; prohibited agency action; prohibited acts by state employees; enforcement; notice

A. A rule is invalid unless it is consistent with the statute, reasonably necessary to carry out the purpose of the statute and is made and approved in substantial compliance with sections 41-1021 through 41-1029 and articles 4, 4.1 and 5 of this chapter, unless otherwise provided by law.

B. An agency shall not base a licensing decision in whole or in part on a licensing requirement or condition that is not specifically authorized by statute, rule or state tribal gaming compact. A general grant of authority in statute does not constitute a basis for imposing a licensing requirement or condition unless a rule is made pursuant to that general grant of authority that specifically authorizes the requirement or condition.

C. An agency shall not base a decision regarding any filing or other matter submitted by a licensee on a requirement or condition that is not specifically authorized by a statute, rule, federal law or regulation or state tribal gaming compact. A general grant of authority in statute does not constitute a basis for imposing a requirement or condition for approval of a decision on any filing or other matter submitted by a licensee unless a rule is made pursuant to that general grant of authority that specifically authorizes the requirement or condition.

D. An agency shall not:

Make a rule under a specific grant of rulemaking authority that exceeds the subject matter areas listed in the specific statute authorizing the rule.
Make a rule under a general grant of rulemaking authority to supplement a more specific grant of rulemaking authority.
Make a rule that is not specifically authorized by statute.

E. This section may be enforced in a private civil action and relief may be awarded against the state. The court may award reasonable attorney fees, damages and all fees associated with the license application to a party that prevails in an action against the state for a violation of this section.

F. A state employee may not intentionally or knowingly violate this section. A violation of this section is cause for disciplinary action or dismissal pursuant to the agency's adopted personnel policy.

G. This section does not abrogate the immunity provided by section 12-820.01 or 12-820.02.

H. An agency shall prominently print the provisions of subsections B, E, F and G of this section on all license applications, except license applications processed by the corporation commission.

I. The license application may be in either print or electronic format.

§ 41-1031 Filing rules and preamble with secretary of state; permanent record

A. Following the filing of a rule made pursuant to an exemption to this chapter or following approval and filing of a rule and preamble and an economic, small business and consumer impact statement by the council as provided in article 5 of this chapter or by the attorney general as provided in article 4 of this chapter, the secretary of state shall affix to each rule document, preamble and economic, small business and consumer impact statement the time and date of filing. A rule is not final until the secretary of state affixes the time and date of filing to the rule document as provided in this section.

B. The secretary of state shall keep a permanent record of rules, preambles and economic, small business and consumer impact statements filed with the office.

§ 41-1032 Effective date of rules

A. A rule filed pursuant to section 41-1031 becomes effective sixty days after a certified original and two copies of the rule and preamble are filed in the office of the secretary of state and the time and date are affixed as provided in section 41-1031, unless the rule making agency includes in the preamble information that demonstrates that the rule needs to be effective immediately on filing in the office of the secretary of state and the time and date are affixed as provided in section 41-1031. A rule may only be effective immediately for any of the following reasons:

To preserve the public peace, health or safety.
To avoid a violation of federal law or regulation or state law, if the need for an immediate effective date is not created due to the agency's delay or inaction.
To comply with deadlines in amendments to an agency's governing statute or federal programs, if the need for an immediate effective date is not created due to the agency's delay or inaction.
To provide a benefit to the public and a penalty is not associated with a violation of the rule.
To adopt a rule that is less stringent than the rule that is currently in effect and that does not have an impact on the public health, safety, welfare or environment, or that does not affect the public involvement and public participation process.

B. Notwithstanding subsection A of this section, a rule making agency may specify an effective date more than sixty days after the filing of the rule in the office of the secretary of state if the agency determines that good cause exists for and the public interest will not be harmed by the later date.

C. This section does not affect the validity of an existing rule until the new or amended rule that is filed with the secretary of state is effective pursuant to this section.

§ 41-1033 Petition for a rule or review of an agency practice, substantive policy statement, final rule or unduly burdensome licensing requirement; notice

A. Any person may petition an agency to do either of the following:

Make, amend or repeal a final rule.
Review an existing agency practice or substantive policy statement that the petitioner alleges to constitute a rule.

B. An agency shall prescribe the form of the petition and the procedures for the petition's submission, consideration and disposition. The person shall state on the petition the rulemaking to review or the agency practice or substantive policy statement to consider revising, repealing or making into a rule.

C. Not later than sixty days after submission of the petition, the agency shall either:

Reject the petition and state its reasons in writing for rejection to the petitioner.
Initiate rulemaking proceedings in accordance with this chapter.
If otherwise lawful, make a rule.

D. The agency's response to the petition is open to public inspection.

E. If an agency rejects a petition pursuant to subsection C of this section, the petitioner has thirty days to appeal to the council to review whether the existing agency practice or substantive policy statement constitutes a rule. The petitioner's appeal may not be more than five double-spaced pages.

F. A person may petition the council to request a review of a final rule based on the person's belief that the final rule does not meet the requirements prescribed in section 41-1030. A petition submitted under this subsection may not be more than five double-spaced pages.

G. A person may petition the council to request a review of an existing agency practice, substantive policy statement, final rule or regulatory licensing requirement that the petitioner alleges is not specifically authorized by statute, exceeds the agency's statutory authority, is unduly burdensome or is not demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern. On receipt of a properly submitted petition pursuant to this section, the council shall review the existing agency practice, substantive policy statement, final rule or regulatory licensing requirement as prescribed by this section. A petition submitted under this subsection may not be more than five double-spaced pages. This subsection does not apply to an individual or institution that is subject to title 36, chapter 4, article 10 or chapter 20.

H. If the council receives information that alleges an existing agency practice or substantive policy statement may constitute a rule, that a final rule does not meet the requirements prescribed in section 41-1030 or that an existing agency practice, substantive policy statement, final rule or regulatory licensing requirement exceeds the agency's statutory authority, is not specifically authorized by statute or does not meet the guidelines prescribed in subsection G of this section, or if the council receives an appeal under subsection E of this section, and at least three council members request of the chairperson that the matter be heard in a public meeting:

Within ninety days after receiving the third council member's request, the council shall determine whether any of the following applies:

(a) The agency practice or substantive policy statement constitutes a rule.

(b) The final rule meets the requirements prescribed in section 41-1030.

(c) An existing agency practice, substantive policy statement, final rule or regulatory licensing requirement exceeds the agency's statutory authority, is not specifically authorized by statute or meets the guidelines prescribed in subsection G of this section.

Within ten days after receiving the third council member's request, the council shall notify the agency that the matter has been or will be placed on the council's agenda for consideration on the merits.
Not later than thirty days after receiving notice from the council, the agency shall submit a statement of not more than five double-spaced pages to the council that addresses whether any of the following applies:

(a) The existing agency practice or substantive policy statement constitutes a rule.

(b) The final rule meets the requirements prescribed in section 41-1030.

I. At the hearing, the council shall allocate the petitioner and the agency an equal amount of time for oral comments not including any time spent answering questions raised by council members. The council may also allocate time for members of the public who have an interest in the issue to provide oral comments.

J. For the purposes of subsection H of this section, the council meeting shall not be scheduled until the expiration of the agency response period prescribed in subsection H, paragraph 3 of this section.

K. An agency practice, substantive policy statement, final rule or regulatory licensing requirement considered by the council pursuant to this section shall remain in effect while under consideration of the council. If the council determines that the agency practice, substantive policy statement or regulatory licensing requirement exceeds the agency's statutory authority, is not authorized by statute or constitutes a rule or that the final rule does not meet the requirements prescribed in section 41-1030, the practice, policy statement, rule or regulatory licensing requirement shall be void. If the council determines that the existing agency practice, substantive policy statement, final rule or regulatory licensing requirement is unduly burdensome or is not demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern, the council shall modify, revise or declare void any such existing agency practice, substantive policy statement, final rule or regulatory licensing requirement. If an agency decides to further pursue a practice, substantive policy statement or regulatory licensing requirement that has been declared void or has been modified or revised by the council, the agency may do so only pursuant to a new rulemaking.

L. A council decision pursuant to this section shall be made by a majority of the council members who are present and voting on the issue. Notwithstanding any other law, the council may not base any decision concerning an agency's compliance with the requirements of section 41-1030 in issuing a final rule or substantive policy statement on whether any party or person commented on the rulemaking or substantive policy statement.

M. A decision by the council pursuant to this section is not subject to judicial review, except that, in addition to the procedure prescribed in this section or in lieu of the procedure prescribed in this section, a person may seek declaratory relief pursuant to section 41-1034.

N. Each agency and the secretary of state shall post prominently on their websites notice of an individual's right to petition the council for review pursuant to this section.

§ 41-1034 Declaratory judgment

A. Any person who is or may be affected by a rule may obtain a judicial declaration of the validity of the rule by filing an action for declaratory relief in the superior court in Maricopa county in accordance with title 12, chapter 10, article 2.

B. Any person who is or may be affected by an existing agency practice or substantive policy statement that the person alleges to constitute a rule may obtain a judicial declaration on whether the practice or substantive policy statement constitutes a rule by filing an action for declaratory relief in the superior court in Maricopa county in accordance with title 12, chapter 10, article 2.

§ 41-1035 Rules affecting small businesses; reduction of rule impact

If an agency proposes a new rule or an amendment to an existing rule which may have an impact on small businesses, the agency shall consider each of the methods described in this section for reducing the impact of the rule making on small businesses. The agency shall reduce the impact by using one or more of the following methods, if it finds that the methods are legal and feasible in meeting the statutory objectives which are the basis of the proposed rule making:

Establish less stringent compliance or reporting requirements in the rule for small businesses.
Establish less stringent schedules or deadlines in the rule for compliance or reporting requirements for small businesses.
Consolidate or simplify the rule's compliance or reporting requirements for small businesses.
Establish performance standards for small businesses to replace design or operational standards in the rule.
Exempt small businesses from any or all requirements of the rule.

§ 41-1036 Preamble; justifications for rule making

Only the reasons contained in the preamble may be used by any party as justifications for the making of the rule in any proceeding in which its validity is at issue.

§ 41-1037 General permits; issuance of traditional permit

A. If an agency proposes a new rule or an amendment to an existing rule that requires the issuance of a regulatory permit, license or agency authorization, the agency shall use a general permit if the facilities, activities or practices in the class are substantially similar in nature unless any of the following applies:

A general permit is prohibited by federal law.
The issuance of an alternative type of permit, license or authorization is specifically authorized by state statute.
The issuance of a general permit is not technically feasible or would not meet the applicable statutory requirements.
The issuance of a general permit would result in additional regulatory requirements or costs being placed on the permit applicant.
The permit, license or authorization is issued pursuant to section 8-126, 8-503, 8-505, 23-504, 36-592, 36-594.01, 36-595, 36-596, 36-596.54, 41-1967.01 or 46-807.
The permit, license or authorization is issued pursuant to title V of the clean air act.

B. The agency retains the authority to revoke an applicant's ability to operate under a general permit and to require the applicant to obtain a traditional permit if the applicant is in substantial noncompliance with the applicable requirements for the general permit.

§ 41-1038 Rules; restrictions; affirmative defense; exceptions; definition

A. Notwithstanding any other law, an agency may not adopt any new rule that would increase existing regulatory restraints or burdens on the free exercise of property rights or the freedom to engage in an otherwise lawful business or occupation unless the rule is either of the following:

A component of a comprehensive effort to reduce regulatory restraints or burdens.
Necessary to implement statutes or required by a final court order or decision.

B. Any person who is subject to a civil or criminal proceeding arising from the enforcement of a rule in violation of subsection A of this section has an affirmative defense to the enforcement action. Any court or administrative body considering or reviewing the defense shall rule on its merits without deference to any legislative, administrative or executive finding concerning the rule. The court or administrative body may award the prevailing party, other than the agency, attorney fees and costs.

C. This section does not apply to rules that either:

Govern public employees.
Are necessary to protect public health and safety.
Are necessary to avoid sanctions that would result from a failure to take rulemaking action pursuant to a court order or federal law.

D. For the purposes of this section, agency does not include any board, commission, department, officer or other administrative unit of this state established under the authority of the constitution of Arizona.

E. For the purposes of this section, "to protect public health and safety" means the immediate need to address or prevent an outbreak of an infectious disease, a disaster or any other catastrophic event.

§ 41-1039 State agency rulemaking; governor approval; submission; definition

A. Notwithstanding any other law, a state agency may not conduct any rulemaking, including regular, expedited, informal, formal, emergency or exempt rulemaking, without prior written approval of the governor. In seeking approval, a state agency shall address any of the following as justification for the rulemaking:

Fulfilling an objective related to job creation, economic development or economic expansion in this state.
Reducing or ameliorating a regulatory burden on the public, while achieving the same regulatory objective.
Preventing a significant threat to public health, peace or safety.
Avoiding violating a court order or federal law that would result in sanctions by a federal court for failure to conduct the rulemaking action.
Complying with a new state statutory or regulatory requirement if the compliance is related to a condition for the receiving federal monies or participating in any federal program.
Complying with a new or existing state statutory requirement.
Fulfilling an obligation related to fees or any other action necessary to implement the state budget that is certified by the governor's office of strategic planning and budgeting.
Adopting a rule or other item that is exempt from this chapter.
Matters pertaining to the control, mitigation or eradication of waste, fraud or abuse within a state agency or wasteful, fraudulent or abusive activities perpetrated against a state agency.
Eliminating rules that are antiquated, redundant or otherwise no longer necessary for the operation of state government.

B. After the public comment period and the close of the rulemaking record, a state agency may not submit the proposed rules to the council without a written final approval from the governor. Before considering rules submitted by a state agency, the council must obtain from the state agency the initial approval pursuant to subsection A of the section and the final approval required by this subsection.

C. Notwithstanding any other law, a state agency that submits a rulemaking request shall recommend for consideration by the governor at least three existing rules to eliminate for every additional rule requested by the state agency. The requirements of this subsection do not apply to rules that are necessary to secure or maintain assumption of federal regulatory programs, rules that are necessary to comply with an auditor general recommendation or rules that are necessary to address a new statutory requirement.

D. A state agency may not publicize any directives, policy statements, documents or forms on its website unless the directive, policy statement, document or form is authorized by statute or rule. A state agency shall remove material not authorized by statute or rule from its website on September 24, 2022.

E. For the purposes of this section, "state agency":

Includes all executive departments, agencies and offices and all state boards and commissions.
Does not include:

(a) A state agency that is headed by a single elected state official.

(b) The corporation commission.

(d) The judiciary.

Article 4 Attorney General Review of Rulemaking

§ 41-1044 Attorney general review of certain exempt rules

A. The attorney general shall review rules that are exempt pursuant to section 41-1057.

B. Rules that are exempt pursuant to section 41-1057 shall not be filed with the secretary of state unless the attorney general approves the rule as:

To form.
Clear, concise and understandable.
Within the power of the agency to make and within the enacted legislative standards.
Made in compliance with the appropriate procedures.

C. The attorney general shall not approve a rule with an immediate effective date unless the attorney general determines that the rule complies with section 41-1032.

D. Within sixty days of receipt of the rule the attorney general shall endorse the attorney general's approval on the rule package. After approval, the attorney general shall file the rule package with the secretary of state.

E. If the attorney general determines that the rule does not comply with subsection B of this section, the attorney general shall endorse the attorney general's disapproval of the rule on the rule package, state the reasons for the disapproval and within sixty days after receipt of the rule return the rule package to the agency that made the rule.

Article 4.1 Administrative Rules Oversight Committee

§ 41-1046 Administrative rules oversight committee; membership; appointment; staffing; meetings

A. The administrative rules oversight committee is established. The committee has oversight over any rules except those rules exempted by section 41-1005.

B. The committee consists of the following eleven members:

Five members of the house of representatives who are appointed by the speaker of the house of representatives. No more than three of the members who are appointed under this paragraph may be members of the same political party. The speaker of the house of representatives shall designate a member to serve as cochairperson of the committee.
Five members of the senate who are appointed by the president of the senate. No more than three of the members who are appointed under this paragraph may be members of the same political party. The president of the senate shall designate a member to serve as cochairperson of the committee.
The governor or the governor's designee who is not an appointed agency director.

C. The speaker of the house of representatives and the president of the senate shall make the appointments to the committee on or before October 1, 2009. Members serve at the pleasure of their respective appointing officer.

D. The legislative council shall staff the committee.

E. The committee shall meet on the call of either of its cochairpersons.

F. A party contesting the legality of a rule, agency practice or substantive policy statement is not required to file a complaint with the committee to exhaust its administrative remedies.

§ 41-1047 Committee review of rules; practices alleged to constitute rules; substantive policy statements

The committee may review any proposed or final rule, expedited rule, agency practice alleged to constitute a rule or substantive policy statement for conformity with statute and legislative intent. The committee may hold hearings on whether a proposed or final rule, expedited rule, agency practice alleged to constitute a rule or substantive policy statement is consistent with statute and legislative intent. The committee may comment to the agency, attorney general or council on whether the proposed or final rule, expedited rule, agency practice alleged to constitute a rule or substantive policy statement is consistent with statute or legislative intent. The committee may designate a representative to testify before the council. The council shall consider the comments of the committee and any testimony. The administrative records shall contain the comments of the committee and any testimony.

§ 41-1048 Committee review of duplicative or onerous statutes, rules, practices alleged to constitute rules and substantive policy statements

A. The committee shall receive complaints concerning statutes, rules, agency practices alleged to constitute rules and substantive policy statements that are alleged to be duplicative or onerous. The committee may review any statutes, rules, agency practices alleged to constitute rules or substantive policy statements alleged to be duplicative or onerous and may hold hearings regarding the allegations. The committee may comment to an agency, the attorney general, the council or the legislature on whether the statutes, rules, agency practices alleged to constitute rules or substantive policy statements are duplicative or onerous. The comments may include committee recommendations for alleviating the duplicative or onerous aspects of the statutes, rules, agency practices alleged to constitute rules and substantive policy statements.

B. The committee shall prepare a report to the legislature by December 1 of each year recommending legislation to alleviate the effects of duplicative or onerous statutes, rules, agency practices alleged to constitute rules and substantive policy statements.

C. This section applies to all statutes, rules, agency practices alleged to constitute rules and substantive policy statements, regardless of whether the statutes, rules, agency practices alleged to constitute rules or substantive policy statements were enacted or made before or after January 1, 1996.

Article 5 Governor's Regulatory Review Council

§ 41-1051 Governor's regulatory review council; membership; terms; compensation; powers; council staff

A. The governor's regulatory review council is established consisting of four members who are appointed by the governor, one member who is not a legislator and who is appointed by the president of the senate, one member who is not a legislator and who is appointed by the speaker of the house of representatives and the director of the department of administration or the assistant director of the department of administration who is responsible for administering the council. The director or assistant director is an ex officio member and chairperson of the council. The council shall elect a vice chairperson to serve as chairperson in the chairperson's absence.

B. Members of the council shall be appointed for staggered terms of three years and may be reappointed. A vacancy occurring during the term of office of any member shall be filled for the unexpired portion of the term in the same manner as provided in this section.

C. The council shall meet at least once a month at a time and place set by the chairperson and at other times and places as the chairperson deems necessary.

D. Members of the council are eligible to receive compensation in an amount of $200 for each day on which the council meets and reimbursement of expenses pursuant to title 38, chapter 4, article 2.

E. The chairperson, subject to chapter 4, article 4 and, as applicable, articles 5 and 6 of this title, shall employ, determine the conditions of employment of and specify the duties of administrative, secretarial and clerical employees as the chairperson deems necessary.

F. The council may make rules pursuant to this chapter to carry out the purposes of this chapter.

G. The council shall make a list of agency rules approved or returned pursuant to sections 41-1027 and 41-1052 and section 41-1056, subsection C for the previous twelve-month period available to the public on request and on the council's website.

H. Council staff shall do both of the following:

At the request of a council member, review the constitution of this state and any relevant statutes and advise the council on the constitutionality of a rule independent of an agency's statutory justification for the rule. Notwithstanding any other law, for the purposes of this paragraph, council staff is exempt from section 41-192 and the council may employ legal counsel and make an expenditure or incur an indebtedness for legal services to implement, advise or defend this paragraph.
Electronically distribute all nonprivileged council meeting materials to the governor, the president of the senate and the speaker of the house of representatives at the same time the materials are distributed to the members of the council.

§ 41-1052 Council review and approval; rule expiration

A. Before filing a final rule subject to this section with the secretary of state, an agency shall prepare, transmit to the council and the committee and obtain the council's approval of the rule and its preamble and economic, small business and consumer impact statement that meets the requirements of section 41-1055. The office of economic opportunity shall prepare the economic, small business and consumer impact statement.

B. The council shall accept an early review petition of a proposed rule, in whole or in part, if the proposed rule is alleged to violate any of the criteria prescribed in subsection D of this section and if the early petition is filed by a person who would be adversely impacted by the proposed rule. The council may determine whether the proposed rule, in whole or in part, violates any of the criteria prescribed in subsection D of this section.

C. Within one hundred twenty days after receipt of the rule, preamble and economic, small business and consumer impact statement, the council shall review and approve or return, in whole or in part, the rule, preamble or economic, small business and consumer impact statement. An agency may resubmit a rule, preamble or economic, small business and consumer impact statement if the council returns the rule, preamble or economic, small business and consumer impact statement, in whole or in part, to the agency.

D. The council shall not approve the rule unless:

The economic, small business and consumer impact statement contains information from the state, data and analysis prescribed by this article.
The economic, small business and consumer impact statement is generally accurate.
The probable benefits of the rule outweigh within this state the probable costs of the rule and the agency has demonstrated that it has selected 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.
The rule is written in a manner that is clear, concise and understandable to the general public.
The rule is not illegal, inconsistent with legislative intent or beyond the agency's statutory authority and meets the requirements prescribed in section 41-1030.
The agency adequately addressed, in writing, the comments on the proposed rule and any supplemental proposals.
The rule is not a substantial change, considered as a whole, from the proposed rule and any supplemental notices.
The preamble discloses a reference to any study relevant to the rule that the agency reviewed and either did or did not rely on in the agency's evaluation of or justification for the rule.
The rule is not more stringent than a corresponding federal law unless there is statutory authority to exceed the requirements of that federal law.
If a rule requires a permit, the permitting requirement complies with section 41-1037.

E. The council shall verify that a rule with new fees does not violate section 41-1008. The council shall not approve a rule that contains a fee increase unless two-thirds of the voting quorum present votes to approve the rule.

F. The council shall verify that a rule with an immediate effective date complies with section 41-1032. The council shall not approve a rule with an immediate effective date unless two-thirds of the voting quorum present votes to approve the rule. The council may only vote at a council meeting.

G. If the rule relies on scientific principles or methods, including a study disclosed pursuant to subsection D, paragraph 8 of this section, and a person submits an analysis to the council questioning whether the rule is based on valid scientific or reliable principles or methods, the council shall not approve the rule unless the council determines that the rule is based on valid scientific or reliable principles or methods that are specific and not of a general nature. In making a determination of reliability or validity, the council shall consider the following factors as applicable to the rule:

The authors of the study, principle or method have subject matter knowledge, skill, experience, training and expertise.
The study, principle or method is based on sufficient facts or data.
The study is the product of reliable principles and methods.
The study and its conclusions, principles or methods have been tested or subjected to peer reviewed publications.
The known or potential error rate of the study, principle or method has been identified along with its basis.
The methodology and approach of the study, principle or method are generally accepted in the scientific community.

H. The council may require a representative of an agency whose rule is under examination to attend a council meeting and answer questions. The council may also communicate to the agency its comments on any rule, preamble or economic, small business and consumer impact statement and require the agency to respond to its comments in writing.

I. For all council meetings that are open to the public for comment, the council shall allot an equal amount of time to the individuals who support or oppose a rule.

J. At any time during the thirty days immediately following receipt of the rule, a person may submit written comments to the council that are within the scope of subsection D, E, F or G of this section. The council may allow testimony at a council meeting within the scope of subsection D, E, F or G of this section.

K. If the agency makes a good faith effort to comply with the requirements prescribed in this article and has explained in writing the methodology used to produce the economic, small business and consumer impact statement, the rule may not be invalidated after it is finalized on the ground that the contents of the economic, small business and consumer impact statement are insufficient or inaccurate or on the ground that the council erroneously approved the rule, except as provided by section 41-1056.01.

L. The absence of comments pursuant to subsection D, E, F or G of this section or article 4.1 of this chapter does not prevent the council from acting pursuant to this section.

M. The council shall review and approve or reject a notice of proposed expedited rulemaking pursuant to section 41-1027.

N. An agency that seeks to expire a rule or rules may file a notice of intent to expire with the council. The notice shall describe the rule or rules to be expired and the reasons for expiration. The council shall place the notice on the agenda for the next scheduled council meeting for consideration. If a quorum of the council approves the notice, the council shall cause a notice of rule expiration to be prepared and provide the notice of rule expiration to the agency for filing with the secretary of state.

§ 41-1053 Council review of expedited rules

A. After receipt of the expedited rule package from the agency, the council shall place the expedited rule on its consent agenda for approval unless a member of the council or the committee requests a hearing.

B. If a hearing is requested, the council shall act on the expedited rule pursuant to section 41-1052 or shall remand the expedited rule to the agency for initiation of a rule making pursuant to sections 41-1022, 41-1023 and 41-1024.

C. The council, at any time a proposed expedited rule is pending, may disapprove the expedited rule making and order initiation of a regular rule making pursuant to sections 41-1022, 41-1023 and 41-1024.

§ 41-1055 Economic, small business and consumer impact statement

A. The economic, small business and consumer impact summary in the preamble shall include:

An identification of the proposed rule making, including all of the following:

(a) The conduct and its frequency of occurrence that the rule is designed to change.

(b) The harm resulting from the conduct the rule is designed to change and the likelihood it will continue to occur if the rule is not changed.

A brief summary of the information included in the economic, small business and consumer impact statement.
If the economic, small business and consumer impact summary accompanies a proposed rule or a proposed expedited rule, the name and address of agency employees who may be contacted to submit or request additional data on the information included in the economic, small business and consumer impact statement.

B. The economic, small business and consumer impact statement shall include:

An identification of the proposed rule making.
An identification of the persons who will be directly affected by, bear the costs of or directly benefit from the proposed rule making.
A cost benefit analysis of the following:

(a) The probable costs and benefits to the implementing agency and other agencies directly affected by the implementation and enforcement of the proposed rule making. The probable costs to the implementing agency shall include the number of new full-time employees necessary to implement and enforce the proposed rule. The preparer of the economic, small business and consumer impact statement shall notify the joint legislative budget committee of the number of new full-time employees necessary to implement and enforce the rule before the rule is approved by the council.

(b) The probable costs and benefits to a political subdivision of this state directly affected by the implementation and enforcement of the proposed rule making.

(c) The probable costs and benefits to businesses directly affected by the proposed rule making, including any anticipated effect on the revenues or payroll expenditures of employers who are subject to the proposed rule making.

A general description of the probable impact on private and public employment in businesses, agencies and political subdivisions of this state directly affected by the proposed rule making.
A statement of the probable impact of the proposed rule making on small businesses. The statement shall include:

(a) An identification of the small businesses subject to the proposed rule making.

(b) The administrative and other costs required for compliance with the proposed rule making.

(c) A description of the methods prescribed in section 41-1035 that the agency may use to reduce the impact on small businesses, with reasons for the agency's decision to use or not to use each method.

(d) The probable cost and benefit to private persons and consumers who are directly affected by the proposed rule making.

A statement of the probable effect on state revenues.
A description of any less intrusive or less costly alternative methods of achieving the purpose of the proposed rule making, including the monetizing of the costs and benefits for each option and providing the rationale for not using nonselected alternatives.
A description of any data on which a rule is based with a detailed explanation of how the data was obtained and why the data is acceptable data. An agency advocating that any data is acceptable data has the burden of proving that the data is acceptable. For the purposes of this paragraph, "acceptable data" means empirical, replicable and testable data as evidenced in supporting documentation, statistics, reports, studies or research.

C. If for any reason adequate data are not reasonably available to comply with the requirements of subsection B of this section, the agency shall explain the limitations of the data and the methods that were employed in the attempt to obtain the data and shall characterize the probable impacts in qualitative terms. The absence of adequate data, if explained in accordance with this subsection, shall not be grounds for a legal challenge to the sufficiency of the economic, small business and consumer impact statement.

D. An agency is not required to prepare an economic, small business and consumer impact statement pursuant to this chapter and is not required to file a petition pursuant to subsection E of this section for the following rule makings:

Initial making, but not renewal, of an emergency rule pursuant to section 41-1026.
Proposed expedited rule making or final expedited rule making.

E. Before filing a proposed rule with the secretary of state, an agency may petition the council for a determination that the agency is not required to file an economic, small business and consumer impact statement. The petition shall demonstrate both of the following:

The rule making decreases monitoring, record keeping, costs or reporting burdens on agencies, political subdivisions, businesses or persons.
The rule making does not increase monitoring, record keeping, costs or reporting burdens on persons subject to the proposed rule making.

F. The council shall place a petition under subsection E of this section on the agenda of its next meeting if at least four council members make such a request of the council chairperson within two weeks after the filing of the petition.

G. The preamble for a rule making that is exempt pursuant to subsection D or E of this section shall state that the rule making is exempt from the requirements to prepare and file an economic, small business and consumer impact statement.

H. The cost-benefit analysis required by subsection B of this section shall calculate only the costs and benefits that occur in this state.

I. If a person submits an analysis to the agency regarding the rule's impact on the competitiveness of businesses in this state as compared to the competitiveness of businesses in other states, the agency shall consider the analysis.

§ 41-1056 Review by agency

A. At least once every five years, each agency shall review all of its rules, including rules made pursuant to an exemption from this chapter or any part of this chapter, to determine whether any rule should be amended or repealed. The agency shall prepare and obtain council approval of a written report summarizing its findings, its supporting reasons and any proposed course of action. The report shall contain a certification that the agency is in compliance with section 41-1091. For each rule, the report shall include a concise analysis of all of the following:

The rule's effectiveness in achieving its objectives, including a summary of any available data supporting the conclusions reached.
Written criticisms of the rule received during the previous five years, including any written analyses submitted to the agency questioning whether the rule is based on valid scientific or reliable principles or methods.
Authorization of the rule by existing statutes.
Whether the rule is consistent with statutes or other rules made by the agency and current agency enforcement policy.
The clarity, conciseness and understandability of the rule.
The estimated economic, small business and consumer impact of the rules as compared to the economic, small business and consumer impact statement prepared on the last making of the rules.
Any analysis submitted to the agency by another person regarding the rule's impact on this state's business competitiveness as compared to the competitiveness of businesses in other states.
If applicable, that the agency completed the previous five-year review process.
A determination that the probable benefits of the rule outweigh within this state the probable costs of the rule, and the rule 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.
A determination that the rule is not more stringent than a corresponding federal law unless there is statutory authority to exceed the requirements of that federal law.
For rules adopted after July 29, 2010 that require the issuance of a regulatory permit, license or agency authorization, whether the rule complies with section 41-1037.

B. An agency may also include as part of the report the text of a proposed expedited rule pursuant to section 41-1027.

C. The council shall schedule the periodic review of each agency's rules and shall approve or return, in whole or in part, the agency's report on its review. The council may grant an agency an extension from filing an agency's report. If the council returns an agency's report, in whole or in part, the council shall inform the agency of the manner in which its report is inadequate and, in consultation with the agency, shall schedule submission of a revised report. The council shall not approve a report unless the report complies with subsection A of this section.

D. The council may review rules outside of the five-year review process if requested by at least four council members.

E. The council may require the agency to propose an amendment or repeal of the rule by a date no earlier than six months after the date of the meeting at which the council considers the agency's report on its rule if the council determines the agency's analysis under subsection A of this section demonstrates that the rule is materially flawed, including that the rule:

Is not authorized by statute.
Is inconsistent with other statutes, rules or agency enforcement policies and the inconsistency results in a significant burden on the regulated public.
Imposes probable costs, including costs to the regulated person, that significantly exceed the probable benefits of the rule within this state.
Is more stringent than a corresponding federal law and there is no statutory authority to exceed the requirements of federal law.
Is not clear, concise and understandable.
Does not use general permits if required under section 41-1037.
Does not impose the least burden to persons regulated by the rule as necessary to achieve the underlying regulatory objective of the rule.
Does not rely on valid scientific or reliable principles and methods, including a study, if the rule relies on scientific principles or methods, and a person has submitted an analysis under subsection A of this section questioning whether the rule is based on valid scientific or reliable principles or methods. In making a determination of validity or reliability, the council shall consider the factors listed in section 41-1052, subsection G.

F. An agency may request an extension of no longer than one year from the date specified by the council pursuant to subsection E of this section by sending a written request to the council that:

Identifies the reason for the extension request.
Demonstrates good cause for the extension.

G. The agency shall notify the council of an amendment or repeal of a rule for which the council has set an expiration date under subsection E of this section. If the agency does not amend or repeal the rule by the date specified by the council under subsection E of this section or the extended date under subsection F of this section, the rule automatically expires. The council shall file a notice of rule expiration with the secretary of state and notify the agency of the expiration of the rule.

H. The council may reschedule a report or portion of a report for any rule that is scheduled for review and that was initially made or substantially revised within two years before the due date of the report as scheduled by the council.

I. If an agency finds that it cannot provide the written report to the council by the date it is due, the agency may file an extension with the council before the due date indicating the reason for the extension. The timely filing for an extension permits the agency to submit its report on or before the date prescribed by the council.

J. If an agency fails to submit its report, including a revised report, pursuant to subsection A or C of this section, or file an extension before the due date of the report or if it files an extension and does not submit its report within the extension period, the rules scheduled for review expire and the council shall:

Cause a notice to be published in the next register that states the rules have expired and are no longer enforceable.
Notify the secretary of state that the rules have expired and that the rules are to be removed from the code.
Notify the agency that the rules have expired and are no longer enforceable.

K. If a rule expires as provided in subsection J of this section and the agency wishes to reestablish the rule, the agency shall comply with the requirements of this chapter.

L. Not less than ninety days before the due date of a report, the council shall send a written notice to the head of the agency whose report is due. The notice shall list the rules to be reviewed and the date the report is due.

M. A person who is regulated or could be regulated by an obsolete rule may petition the council to require an agency that has the obsolete rule to consider including the rule in the five-year report with a recommendation for repeal of the rule.

N. A person who is required to obtain or could be required to obtain a license may petition the council to require an agency to consider including a recommendation for reducing a licensing time frame in the five-year report.

§ 41-1056.01 Impact statements; appeals

A. Within two years after a rule is finalized, a person who is or may be affected by the rule may file a written petition with an agency objecting to all or part of a rule on any of the following grounds:

The actual economic, small business or consumer impact significantly exceeded the impact estimated in the economic, small business and consumer impact statement submitted during the making of the rule.
The actual economic, small business or consumer impact 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.
The agency 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.

B. The burden of proof is on the petitioner to show that any of the provisions set forth in subsection A of this section are met.

C. Within thirty days after receiving the copy of the petition, the agency shall reevaluate the rule and its economic impacts and publish notice of the petition in the register. For at least thirty days after publication of the notice the agency shall afford persons the opportunity to submit in writing statements, arguments, data and views on the rule and its impacts. Within thirty days after the close of comment, the agency shall publish a written summary of comments received, the agency's response to those comments, and the final decision of the agency on whether to initiate a rule making or to amend or repeal the rule. The agency shall initiate any such rule making within forty-five days after publication of its final decision.

D. Any person who is or may be affected by the agency's final decision on whether to initiate a rule making pursuant to subsection C of this section may appeal that decision to the council within thirty days after publication of the agency's final decision.

E. The council shall place on its agenda the appeal if at least three council members make such a request of the council chairman within two weeks after the filing of the appeal with the council.

F. If the appeal is placed on the council's agenda, the council chairman shall provide a copy of the appeal and written notice to the agency that the council will consider the appeal. The agency shall provide the council with a copy of the written summary described in subsection C of this section.

G. The council shall require an agency to promptly initiate a rule making or to amend or repeal the rule or the rule package, as prescribed by section 41-1024, subsection E, objected to in the petition if the council finds that any of the provisions set forth in subsection A of this section are met.

H. This section shall not apply to a rule for which there is a final judgment of a court of competent jurisdiction based on the grounds of whether the contents of the economic, small business and consumer impact statement were insufficient or inaccurate.

§ 41-1057 Exemptions

A. In addition to the exemptions stated in section 41-1005, this article does not apply to:

An agency which is a unit of state government headed by a single elected official.
The corporation commission, which shall adopt substantially similar rule review procedures, including the preparation of an economic impact statement and a statement of the effect of the rule on small business.
The industrial commission of Arizona when incorporating by reference the federal occupational safety and health standards as published in 29 Code of Federal Regulations parts 1904, 1910, 1926 and 1928.
The Arizona state lottery if making rules that relate only to the design, operation or prize structure of a lottery game.

B. An agency exempt under subsection A of this section may elect to follow the requirements of this article instead of section 41-1044 for a particular rule making. The agency shall include with a final rule making filed with council a statement that the agency has elected to follow the requirements of this article.

Article 6 Adjudicative Proceedings

§ 41-1061 Contested cases; notice; hearing; records

A. In a contested case, all parties shall be afforded an opportunity for a hearing after reasonable notice. Unless otherwise provided by law, the notice shall be given at least twenty days before the date set for the hearing.

B. The notice shall include:

A statement of the time, place and nature of the hearing.
A statement of the legal authority and jurisdiction under which the hearing is to be held.
A reference to the particular sections of the statutes and rules involved.
A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is served, the initial notice may be limited to a statement of the issues involved. Thereafter on application a more definite and detailed statement shall be furnished.

C. Opportunity shall be afforded all parties to participate in a settlement conference or mediation unless both parties or the hearing officer decline to set a settlement conference or mediation.

D. Opportunity shall be afforded all parties to respond and present evidence and argument on all issues involved. If there is no genuine issue of material fact, a party may seek disposition of the case by motion.

E. Unless precluded by law, and except as to claims for compensation and benefits under title 23, chapter 6, informal disposition may be made of any contested case by stipulation, agreed settlement, consent order or default.

F. The record in a contested case shall include:

All pleadings, motions and interlocutory rulings.
Evidence received or considered.
A statement of matters officially noticed.
Objections and offers of proof and rulings thereon.
Proposed findings and exceptions.
Any decision, opinion or report by the officer presiding at the hearing.
All staff memoranda, other than privileged communications, or data submitted to the hearing officer or members of the agency in connection with their consideration of the case.

G. Oral proceedings or any part of the proceedings shall be recorded manually or by a recording device and shall be transcribed on request of any party, unless otherwise provided by law. The cost of the transcript shall be paid by the party making the request, unless otherwise provided by law or unless assessment of the cost is waived by the agency.

H. Findings of fact shall be based exclusively on the evidence and on matters officially noticed.

§ 41-1062 Hearings; evidence; official notice; power to require testimony and records; rehearing

A. Unless otherwise provided by law, in contested cases the following shall apply:

A hearing may be conducted in an informal manner and without adherence to the rules of evidence required in judicial proceedings. Neither the manner of conducting the hearing nor the failure to adhere to the rules of evidence required in judicial proceedings shall be grounds for reversing any administrative decision or order providing the evidence supporting such decision or order is substantial, reliable, and probative. Irrelevant, immaterial or unduly repetitious evidence shall be excluded. Every person who is a party to such proceedings shall have the right to be represented by counsel, to submit evidence in open hearing and shall have the right of cross-examination. Unless otherwise provided by law, hearings may be held at any place determined by the agency.
Copies of documentary evidence may be received in the discretion of the presiding officer. Upon request, parties shall be given an opportunity to compare the copy with the original.
Notice may be taken of judicially cognizable facts. In addition, notice may be taken of generally recognized technical or scientific facts within the agency's specialized knowledge. Parties shall be notified either before or during the hearing or by reference in preliminary reports or otherwise of the material noticed including any staff memoranda or data and they shall be afforded an opportunity to contest the material so noticed. The agency's experience, technical competence and specialized knowledge may be utilized in the evaluation of the evidence.
The officer presiding at the hearing may cause to be issued subpoenas for the attendance of witnesses and for the production of books, records, documents and other evidence and shall have the power to administer oaths. Unless otherwise provided by law or agency rule, subpoenas so issued shall be served and, upon application to the court by a party or the agency, enforced in the manner provided by law for the service and enforcement of subpoenas in a civil action. On application of a party or the agency and for use as evidence, the officer presiding at the hearing may permit a deposition to be taken, in the manner and upon the terms designated by him, of a witness who cannot be subpoenaed or is unable to attend the hearing. Prehearing depositions and subpoenas for the production of documents may be ordered by the officer presiding at the hearing, provided that the party seeking such discovery demonstrates that the party has reasonable need of the deposition testimony or materials being sought. All provisions of law compelling a person under subpoena to testify are applicable. Fees for attendance as a witness shall be the same as for a witness in the superior courts of the state of Arizona, unless otherwise provided by law or agency rule. Notwithstanding the provisions of section 12-2212, no subpoenas, depositions or other discovery shall be permitted in contested cases except as provided by agency rule or this paragraph.

B. Except when good cause exists otherwise, the agency shall provide an opportunity for a rehearing or review of the decision of an agency before such decision becomes final. Such rehearing or review shall be governed by agency rule drawn as closely as practicable from rule 59, Arizona rules of civil procedure, relating to new trial in superior court.

§ 41-1063 Decisions and orders

Unless otherwise provided by law, any final decision or order adverse to a party in a contested case shall be in writing or stated in the record. Any final decision shall include findings of fact and conclusions of law, separately stated. Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting the findings. Unless otherwise provided by law, parties shall be notified either personally or by mail to their last known address of any decision or order. Upon request a copy of the decision or order shall be delivered or mailed forthwith to each party and to his attorney of record.

§ 41-1064 Licenses; renewal; revocation; suspension; annulment; withdrawal

A. When the grant, denial or renewal of a license is required to be preceded by notice and an opportunity for a hearing, the provisions of this article concerning contested cases apply.

B. When a licensee has made timely and sufficient application for the renewal of a license or a new license with reference to any activity of a continuing nature, the existing license does not expire until the application has been finally determined by the agency, and, in case the application is denied or the terms of the new license limited, until the last day for seeking review of the agency order or a later date fixed by order of the reviewing court.

C. No revocation, suspension, annulment or withdrawal of any license is lawful unless, prior to the action, the agency provides the licensee with notice and an opportunity for a hearing in accordance with this chapter. If the agency finds that the public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in its order, summary suspension of a license may be ordered pending proceedings for revocation or other action. These proceedings shall be promptly instituted and determined.

§ 41-1065 Hearing on denial of license or permit

Proceedings for licenses or permits on application when not required by law to be preceded by notice and opportunity for hearing shall be governed by the provisions of the law relating to the particular agency, provided that when an application for a license or permit is denied under the provisions of the law relating to a particular agency the applicant shall be entitled to have a hearing before such agency on such denial upon filing within fifteen days after receipt of notice of such refusal a written application for such hearing. Notice shall be given in the manner prescribed by section 41-1061. At such hearing such applicant shall be the moving party and have the burden of proof. Such hearing shall be conducted in accordance with this article for hearing of a contested case before an agency. Such hearing before such agency shall be limited to those matters originally presented to the agency for its determination on such application.

§ 41-1066 Compulsory testimony; privilege against self-incrimination

A. A person may not refuse to attend and testify or produce evidence sought by an agency in an action, proceeding or investigation instituted by or before the agency on the ground that the testimony or evidence, documentary or otherwise, required of him may tend to incriminate him or subject him to a penalty or forfeiture unless it constitutes the compelled testimony or the private papers of the person which would be privileged evidence either pursuant to the fifth amendment of the Constitution of the United States or article II, section 10, Constitution of Arizona, and the person claims the privilege prior to the production of the testimony or papers.

B. If a person asserts his privilege against self-incrimination and the agency seeks to compel production of the testimony or documents sought, it may, with the prior written approval of the attorney general, issue a written order compelling the testimony or production of documents in proceedings and investigations before the agency or apply to the appropriate court for such an order in other actions or proceedings.

C. Evidence produced pursuant to subsection B is not admissible in evidence or usable in any manner in a criminal prosecution, except for perjury, false swearing, tampering with physical evidence or any other offense committed in connection with the appearance made pursuant to this section against the person testifying or the person producing his private papers.

§ 41-1067 Applicability of article

This article only applies to contested cases of agencies that are exempt from article 10 of this chapter as provided in section 41-1092.02.

Article 7 Military Administrative Relief

§ 41-1071 Military relief from administrative procedures; process

At any stage, any action or proceeding before any state agency, board, commission or administrative tribunal involving a person on active duty in the military service of the United States or this state as a necessary party, which occurs during such period of service or within sixty days thereafter, may be stayed in the discretion of the state administrative entity before which it is pending, on its own motion. The state administrative entity shall not stay an action or proceeding on its own motion if the service member makes a written objection to the stay. Such action or proceeding shall be stayed on application to the state administrative entity by such person or some person on his behalf, unless in the written decision of the state administrative entity, the ability of the service member to pursue the claim or defense in the action or proceeding is not prejudiced by the military service.

Article 7.1 Licensing Time Frames

§ 41-1072 Definitions

In this article, unless the context otherwise requires:

"Administrative completeness review time frame" means the number of days from agency receipt of an application for a license until an agency determines that the application contains all components required by statute or rule, including all information required to be submitted by other government agencies. The administrative completeness review time frame does not include the period of time during which an agency provides public notice of the license application or performs a substantive review of the application.
"Overall time frame" means the number of days after receipt of an application for a license during which an agency determines whether to grant or deny a license. The overall time frame consists of both the administrative completeness review time frame and the substantive review time frame.
"Substantive review time frame" means the number of days after the completion of the administrative completeness review time frame during which an agency determines whether an application or applicant for a license meets all substantive criteria required by statute or rule. Any public notice and hearings required by law shall fall within the substantive review time frame.

§ 41-1073 Time frames; exception

A. No later than December 31, 1998, an agency that issues licenses shall have in place final rules establishing an overall time frame during which the agency will either grant or deny each type of license that it issues. Agencies shall submit their overall time frame rules to the governor's regulatory review council pursuant to the schedule developed by the council. The council shall schedule each agency's rules so that final overall time frame rules are in place no later than December 31, 1998. The rule regarding the overall time frame for each type of license shall state separately the administrative completeness review time frame and the substantive review time frame.

B. If a statutory licensing time frame already exists for an agency but the statutory time frame does not specify separate time frames for the administrative completeness review and the substantive review, by rule the agency shall establish separate time frames for the administrative completeness review and the substantive review, which together shall not exceed the statutory overall time frame. An agency may establish different time frames for initial licenses, renewal licenses and revisions to existing licenses.

C. The submission by the department of environmental quality of a revised permit to the United States environmental protection agency in response to an objection by that agency shall be given the same effect as a notice granting or denying a permit application for licensing time frame purposes. For the purposes of this subsection, "permit" means a permit required by title 49, chapter 2, article 3.1 or section 49-426.

D. In establishing time frames, agencies shall consider all of the following:

The complexity of the licensing subject matter.
The resources of the agency granting or denying the license.
The economic impact of delay on the regulated community.
The impact of the licensing decision on public health and safety.
The possible use of volunteers with expertise in the subject matter area.
The possible increased use of general licenses for similar types of licensed businesses or facilities.
The possible increased cooperation between the agency and the regulated community.
Increased agency flexibility in structuring the licensing process and personnel.

E. This article does not apply to licenses issued either:

Pursuant to tribal state gaming compacts.
Within seven days after receipt of initial application.
By a lottery method.

§ 41-1074 Compliance with administrative completeness review time frame

A. An agency shall issue a written notice of administrative completeness or deficiencies to an applicant for a license within the administrative completeness review time frame.

B. If an agency determines that an application for a license is not administratively complete, the agency shall include a comprehensive list of the specific deficiencies in the written notice provided pursuant to subsection A of this section. If the agency issues a written notice of deficiencies within the administrative completeness time frame, the administrative completeness review time frame and the overall time frame are suspended from the date the notice is issued until the date that the agency receives the missing information from the applicant.

C. If an agency does not issue a written notice of administrative completeness or deficiencies within the administrative completeness review time frame, the application is deemed administratively complete. If an agency issues a timely written notice of deficiencies, an application is not complete until the agency receives all requested information.

D. Except for an application submitted to the department of water resources pursuant to title 45, a determination by an agency that an application is not administratively complete is an appealable agency action, which if timely initiated, entitles the applicant to an adjudication on the merits of the administrative completeness of the application.

§ 41-1075 Compliance with substantive review time frame

A. During the substantive review time frame, an agency may make one comprehensive written request for additional information. The agency and applicant may mutually agree in writing to allow the agency to submit supplemental requests for additional information. If an agency issues a comprehensive written request or a supplemental request by mutual written agreement for additional information, the substantive review time frame and the overall time frame are suspended from the date the request is issued until the date that the agency receives the additional information from the applicant.

B. By mutual written agreement, an agency and an applicant for a license may extend the substantive review time frame and the overall time frame. An extension of the substantive review time frame and the overall time frame may not exceed twenty-five per cent of the overall time frame.

§ 41-1076 Compliance with overall time frame

Unless an agency and an applicant for a license mutually agree to extend the substantive review time frame and the overall time frame pursuant to section 41-1075, an agency shall issue a written notice granting or denying a license within the overall time frame to an applicant. If an agency denies an application for a license, the agency shall include in the written notice at least the following information:

Justification for the denial with references to the statutes or rules on which the denial is based.
An explanation of the applicant's right to appeal the denial. The explanation shall include the number of days in which the applicant must file a protest challenging the denial and the name and telephone number of an agency contact person who can answer questions regarding the appeals process.

§ 41-1077 Consequence for agency failure to comply with overall time frame; refund; penalty

A. If an agency does not issue to an applicant the written notice granting or denying a license within the overall time frame or within the time frame extension pursuant to section 41-1075, the agency shall refund to the applicant all fees charged for reviewing and acting on the application for the license and shall excuse payment of any such fees that have not yet been paid. The agency shall not require an applicant to submit an application for a refund pursuant to this subsection. The refund shall be made within thirty days after the expiration of the overall time frame or the time frame extension. The agency shall continue to process the application subject to subsection B of this section. Notwithstanding any other statute, the agency shall make the refund from the fund in which the application fees were originally deposited. This section applies only to license applications that were subject to substantive review.

B. Except for license applications that were not subject to substantive review, the agency shall pay a penalty to the state general fund for each month after the expiration of the overall time frame or the time frame extension until the agency issues written notice to the applicant granting or denying the license. The agency shall pay the penalty from the agency fund in which the application fees were originally deposited. The penalty shall be two and one-half per cent of the total fees received by the agency for reviewing and acting on the application for each license that the agency has not granted or denied on the last day of each month after the expiration of the overall time frame or time frame extension for that license.

§ 41-1079 Information required to be provided

A. An agency that issues licenses shall provide the following information to an applicant at the time the applicant obtains an application for a license:

A list of all of the steps the applicant is required to take in order to obtain the license.
The applicable licensing time frames.
The name and telephone number of an agency contact person who can answer questions or provide assistance throughout the application process.

B. This section does not apply to the Arizona peace officer standards and training board established by section 41-1821.

Article 7.2 Licensing Requirements

§ 41-1080 Licensing eligibility; authorized presence; documentation; applicability; definitions

A. Subject to subsections C and D of this section, an agency or political subdivision of this state shall not issue a license to an individual if the individual does not provide documentation of citizenship or alien status by presenting any of the following documents to the agency or political subdivision indicating that the individual's presence in the United States is authorized under federal law:

An Arizona driver license issued after 1996 or an Arizona nonoperating identification license.
A driver license issued by a state that verifies lawful presence in the United States.
A birth certificate or delayed birth certificate issued in any state, territory or possession of the United States.
A United States certificate of birth abroad.
A United States passport.
A foreign passport with a United States visa.
An I-94 form with a photograph.
A United States citizenship and immigration services employment authorization document or refugee travel document.
A United States certificate of naturalization.
A United States certificate of citizenship.
A tribal certificate of Indian blood.
A tribal or bureau of Indian affairs affidavit of birth.
Any other license that is issued by the federal government, any other state government, an agency of this state or a political subdivision of this state that requires proof of citizenship or lawful alien status before issuing the license.

B. This section does not apply to an individual if either:

Both of the following apply:

(a) The individual is a citizen of a foreign country or, if at the time of application, the individual resides in a foreign country.

(b) The benefits that are related to the license do not require the individual to be present in the United States in order to receive those benefits.

All of the following apply:

(a) The individual is a resident of another state.

(b) The individual holds an equivalent license in that other state and the equivalent license is of the same type being sought in this state.

(c) The individual seeks the Arizona license to comply with this state's licensing laws and not to establish residency in this state.

C. If, pursuant to subsection A of this section, an individual has affirmatively established citizenship of the United States or a form of nonexpiring work authorization issued by the federal government, the individual, on renewal or reinstatement of a license, is not required to provide subsequent documentation of that status.

D. If, on renewal or reinstatement of a license, an individual holds a limited form of work authorization issued by the federal government that has expired, the individual shall provide documentation of that status.

E. If a document listed in subsection A, paragraphs 1 through 12 of this section does not contain a photograph of the individual, the individual shall also present a government issued document that contains a photograph of the individual.

F. For the purposes of this section:

"Agency" means any agency, department, board or commission of this state or any political subdivision of this state that issues a license for the purposes of operating a business in this state or to an individual who provides a service to any person.
"License" means any agency permit, certificate, approval, registration, charter or similar form of authorization that is required by law and that is issued by any agency for the purposes of operating a business in this state or to an individual who provides a service to any person where the license is necessary in performing that service.

§ 41-1080.01 Licensing fees; waiver; annual report; definitions

A. Except for an individual who applies for a license pursuant to title 36, chapter 4, article 10 or chapter 28.1, an agency shall waive any fee charged for an initial license for any of the following individuals if the individual is applying for that specific license in this state for the first time:

Any individual applicant whose family income does not exceed two hundred percent of the federal poverty guidelines.
Any active duty military service member's spouse.
Any honorably discharged veteran who has been discharged not more than two years before application.

B. On or before March 1 of each year, the department of administration shall report to the president of the senate, the speaker of the house of representatives, the joint legislative budget committee and the governor's office of strategic planning and budgeting the total number of waived licensing fees by each agency. The report shall specify for which purpose the fee was waived pursuant to this section.

C. For the purposes of this section, "agency" and "license" have the same meanings prescribed in section 41-1080.

Article 8 Delegation of Functions, Powers or Duties

§ 41-1081 Standards for delegation

A. No agency may enter into or amend any delegation agreement unless the delegation agreement clearly sets forth all of the following:

Each function, power or duty being delegated by the agency, the term of the agreement and the procedures for terminating the agreement.
The standards of performance required to fulfill the agreement.
The types of fees that will be imposed on regulated parties and the legal authority for imposing any such fees.
The qualifications of the personnel of the political subdivision responsible for exercising the delegated functions, powers or duties.
Record keeping and reporting requirements.
Auditing requirements if the delegation agreement includes the transfer of funds from the delegating agency to the political subdivision.
A definition of the enforcement role if enforcement authority is being delegated.
Procedures for resolving conflicts between the parties to the delegation agreement.
Procedures for amending the delegation agreement.
The names and addresses of primary contact persons at both the delegating agency and the political subdivision.

B. An agency that seeks to delegate functions, powers or duties shall file with the secretary of state a summary of the proposed delegation agreement. The summary shall provide the name of a person to contact in the agency with questions or comments and shall state that a copy of the proposed delegation agreement may be obtained upon request from the agency. The secretary of state shall publish the summary in the next register.

C. For at least thirty days after publication of the notice of the proposed delegation agreement in the register, the agency shall provide persons the opportunity to submit in writing statements, arguments, data and views on the proposed delegation agreement and shall provide an opportunity for a public hearing if there is sufficient public interest.

D. A public hearing on the delegation agreement shall not be held earlier than thirty days after the notice of its location and time is published in the register. The agency shall determine a location and time for the public hearing that affords a reasonable opportunity for persons to participate. At that public hearing persons may present oral argument, data and views on the proposed delegation agreement.

E. After the conclusion of the public comment period and hearing, if any, the agency shall prepare a written summary, responding to the comments received, whether oral or written. The agency shall consider the comments received from the public in determining whether to enter into the proposed delegation agreement. The agency shall give written notice to those persons who submitted comments of the agency's decision on whether to enter into the proposed delegation agreement. The delegation agreement is effective thirty days after written notice of the agency's final decision is given unless an appeal is filed and pending before the council pursuant to subsection F.

F. A person who filed written comments with the delegating agency objecting to all or part of the proposed delegation agreement may appeal to the council the delegating agency's decision to enter into the delegation agreement within thirty days after the agency gives written notice to enter into the delegation agreement pursuant to subsection E. The council shall place the appeal of the delegation agreement on its next meeting agenda if at least three council members make such a request of the council chairman within two weeks of the filing of the appeal.

G. Delegation agreements that are appealed to and considered by the council shall become effective upon council approval of the delegation agreement. Delegation agreements that are appealed to the council and not considered by the council are effective either thirty days after written notice of the agency's final decision is given pursuant to subsection E, or two weeks after an appeal is filed if at least three council members do not request council consideration of the delegation agreement pursuant to subsection F, whichever date is later.

H. The council shall not approve the delegation agreement if it does not meet the provisions set forth in subsection A or if the agency has not provided adequate notice and an opportunity for comment to the public.

§ 41-1082 Existing delegation agreements

A. By January 1, 1995, each state agency shall compile and make public a list of all delegation agreements that it has entered into with political subdivisions and a list of all subdelegation agreements to the delegation agreements. Upon request and for a reasonable cost, a person may obtain a copy of any delegation agreement on the list.

B. By January 1, 1996, each state agency shall amend, if necessary, any delegation agreement entered into prior to the effective date of this article to conform with criteria set forth in section 41-1081, subsection A.

§ 41-1083 No presumption of funding authority

No political subdivision may assess any fee, tax or other assessment in the exercise of its delegated authorities pursuant to any delegation agreement unless the delegation agreement specifically authorizes the fee, tax or other assessment or the political subdivision is otherwise authorized by law to impose the fee, tax or other assessment.

§ 41-1084 Prohibition on subdelegation

No political subdivision that exercises delegated authority pursuant to a delegation agreement may subdelegate its delegated authority to another agency or political subdivision without first notifying the delegating agency.

Article 9 Substantive Policy Statements

§ 41-1091 Substantive policy statements; directory

A. An agency shall file substantive policy statements pursuant to section 41-1013, subsection B.

B. An agency shall ensure that the first page of each substantive policy statement includes the following notice:

This substantive policy statement is advisory only. A substantive policy statement does not include internal procedural documents that only affect the internal procedures of the agency and does not impose additional requirements or penalties on regulated parties or include confidential information or rules made in accordance with the Arizona administrative procedure act. If you believe that this substantive policy statement does impose additional requirements or penalties on regulated parties you may petition the agency under section 41-1033, Arizona Revised Statutes, for a review of the statement.

C. The agency shall publish at least annually a directory summarizing the subject matter of all currently applicable rules and substantive policy statements. The agency shall keep copies of this directory and all of its substantive policy statements at one location. The directory, rules and substantive policy statements and any materials incorporated by reference in the rules or substantive policy statements shall be open to public inspection at the office of the agency director.

§ 41-1091.01 Posting substantive policy statement and rules

An agency shall post on the agency's website:

The full text of each rule currently in use or the website address and location of the full text of each rule currently in use.
Each substantive policy statement currently in use, including its full text, if practicable.
The notice required by section 41-1091, subsection B.

Article 10 Uniform Administrative Hearing Procedures

§ 41-1092 Definitions

In this article, unless the context otherwise requires:

"Administrative law judge" means an individual or an agency head, board or commission that sits as an administrative law judge, that conducts administrative hearings in a contested case or an appealable agency action and that makes decisions regarding the contested case or appealable agency action.
"Administrative law judge decision" means the findings of fact, conclusions of law and recommendations or decisions issued by an administrative law judge.
"Adversely affected party" means:

(a) An individual who both:

(i) Provides evidence of an actual injury or economic damage that the individual has suffered or will suffer as a direct result of the action and not due to being a competitor or a general taxpayer.

(ii) Timely submits comments on the license application that include, with sufficient specificity, the questions of law, if applicable, that are the basis for the appeal.

(b) A group or association that identifies, by name and physical address in the notice of appeal, a member of the group or association who would be an adversely affected party in the individual's own right.

"Appealable agency action" means an action that determines the legal rights, duties or privileges of a party, including the administrative completeness of an application other than an application submitted to the department of water resources pursuant to title 45, and that is not a contested case. Appealable agency actions do not include interim orders by self-supporting regulatory boards, rules, orders, standards or statements of policy of general application issued by an administrative agency to implement, interpret or make specific the legislation enforced or administered by it or clarifications of interpretation, nor does it mean or include rules concerning the internal management of the agency that do not affect private rights or interests. For the purposes of this paragraph, administrative hearing does not include a public hearing held for the purpose of receiving public comment on a proposed agency action.
"Director" means the director of the office of administrative hearings.
"Final administrative decision" means a decision by an agency that is subject to judicial review pursuant to title 12, chapter 7, article 6.
"Licensee":

(a) Means any individual or business entity that has been issued a license by a state agency to engage in any business or activity in this state and that is subject to a licensing decision.

(b) Includes any individual or business entity that has applied for such a license and that appeals a licensing decision pursuant to section 41-1092.08 or 41-1092.12.

"Office" means the office of administrative hearings.
"Self-supporting regulatory board" means any of the following:

(a) The Arizona state board of accountancy.

(b) The barbering and cosmetology board.

(d) The Arizona state boxing and mixed martial arts commission.

(e) The state board of chiropractic examiners.

(f) The state board of dental examiners.

(g) The Arizona game and fish commission.

(h) The board of homeopathic and integrated medicine examiners.

(i) The Arizona medical board.

(j) The naturopathic physicians medical board.

(k) The Arizona state board of nursing.

(l) The board of examiners of nursing care institution administrators and assisted living facility managers.

(m) The board of occupational therapy examiners.

(n) The state board of dispensing opticians.

(o) The state board of optometry.

(p) The Arizona board of osteopathic examiners in medicine and surgery.

(q) The Arizona peace officer standards and training board.

(r) The Arizona state board of pharmacy.

(s) The board of physical therapy.

(t) The state board of podiatry examiners.

(u) The state board for private postsecondary education.

(v) The state board of psychologist examiners.

(w) The board of respiratory care examiners.

(x) The state board of technical registration.

(y) The Arizona state veterinary medical examining board.

(z) The acupuncture board of examiners.

(aa) The Arizona regulatory board of physician assistants.

(bb) The board of athletic training.

(cc) The board of massage therapy.

§ 41-1092.01 Office of administrative hearings; director; powers and duties; fund

A. An office of administrative hearings is established.

B. The governor shall appoint the director pursuant to section 38-211. At a minimum, the director shall have the experience necessary for appointment as an administrative law judge. The director also shall possess supervisory, management and administrative skills, as well as knowledge and experience relating to administrative law.

C. The director shall:

Serve as the chief administrative law judge of the office.
Make and execute the contracts and other instruments that are necessary to perform the director's duties.
Subject to chapter 4, article 4 of this title, hire employees, including full-time administrative law judges, and contract for special services, including temporary administrative law judges, that are necessary to carry out this article. An administrative law judge employed or contracted by the office shall have graduated from an accredited college of law or shall have at least two years of administrative or managerial experience in the subject matter or agency section the administrative law judge is assigned to in the office.
Make rules that are necessary to carry out this article, including rules governing ex parte communications in contested cases.
Submit a report to the governor, speaker of the house of representatives and president of the senate by November 1 of each year describing the activities and accomplishments of the office. The director's annual report shall include a summary of the extent and effect of agencies' utilization of administrative law judges, court reporters and other personnel in proceedings under this article and recommendations for changes or improvements in the administrative procedure act or any agency's practice or policy with respect to the administrative procedure act. The director shall provide a copy of the report to the secretary of state.
Secure, compile and maintain all decisions, opinions or reports of administrative law judges issued pursuant to this article and the reference materials and supporting information that may be appropriate.
Develop, implement and maintain a program for the continuing training and education of administrative law judges and agencies in regard to their responsibilities under this article. The program shall require that an administrative law judge receive training in the technical and subject matter areas of the sections to which the administrative law judge is assigned.
Develop, implement and maintain a program of evaluation to aid the director in the evaluation of administrative law judges appointed pursuant to this article that includes comments received from the public.
Annually report the following to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of this report to the secretary of state by December 1 for the prior fiscal year:

(a) The number of administrative law judge decisions rejected or modified by agency heads.

(b) By category, the number and disposition of motions filed pursuant to section 41-1092.07, subsection A to disqualify office administrative law judges for bias, prejudice, personal interest or lack of expertise.

Schedule hearings pursuant to section 41-1092.05 on the request of an agency or the filing of a notice of appeal pursuant to section 41-1092.03.

D. The director shall not require legal representation to appear before an administrative law judge.

E. Except as provided in subsection F of this section, all state agencies supported by state general fund sources, unless exempted by this article, and the registrar of contractors shall use the services and personnel of the office to conduct administrative hearings. All other agencies shall contract for services and personnel of the office to conduct administrative hearings.

F. An agency head, board or commission that directly conducts an administrative hearing as an administrative law judge is not required to use the services and personnel of the office for that hearing.

G. Each state agency, and each political subdivision contracting for office services pursuant to subsection I of this section, shall make its facilities available, as necessary, for use by the office in conducting proceedings pursuant to this article.

H. The office shall employ full-time administrative law judges to conduct hearings required by this article or other laws as follows:

The director shall assign administrative law judges from the office to an agency, on either a temporary or a permanent basis, at supervisory or other levels, to preside over contested cases and appealable agency actions in accordance with the special expertise of the administrative law judge in the subject matter of the agency.
The director shall establish the subject matter and agency sections within the office that are necessary to carry out this article. Each subject matter and agency section shall provide training in the technical and subject matter areas of the section as prescribed in subsection C, paragraph 7 of this section.

I. If the office cannot furnish an office administrative law judge promptly in response to an agency request, the director may contract with qualified individuals to serve as temporary administrative law judges. These temporary administrative law judges are not employees of this state.

J. The office may provide administrative law judges on a contract basis to any governmental entity to conduct any hearing not covered by this article. The director may enter into contracts with political subdivisions of this state, and these political subdivisions may contract with the director for the purpose of providing administrative law judges and reporters for administrative proceedings or informal dispute resolution. The contract may define the scope of the administrative law judge's duties. Those duties may include the preparation of findings, conclusions, decisions or recommended decisions or a recommendation for action by the political subdivision. For these services, the director shall request payment for services directly from the political subdivision for which the services are performed, and the director may accept payment on either an advance or reimbursable basis.

K. The office shall apply monies received pursuant to subsections E and J of this section to offset its actual costs for providing personnel and services.

L. The office shall receive complaints against a county, a local government as defined in section 9-1401 or a video service provider as defined in section 9-1401 or 11-1901 and shall comply with the duties imposed on the office pursuant to title 9, chapter 13 for complaints involving local governments and title 11, chapter 14 for complaints involving counties.

§ 41-1092.02 Appealable agency actions; application of procedural rules; exemption from article

A. This article applies to all contested cases as defined in section 41-1001 and all appealable agency actions, except contested cases with or appealable agency actions of:

The state department of corrections.
The board of executive clemency.
The industrial commission of Arizona.
The Arizona corporation commission.
The Arizona board of regents and institutions under its jurisdiction.
The state personnel board.
The department of juvenile corrections.
The department of transportation, except as provided in title 28, chapter 30, article 2.
The department of economic security except as provided in section 46-458.
The department of revenue regarding:

(a) Income tax or withholding tax.

(b) Any tax issue related to information associated with the reporting of income tax or withholding tax unless the taxpayer requests in writing that this article apply and waives confidentiality under title 42, chapter 2, article 1.

The board of tax appeals.
The state board of equalization.
The state board of education, but only in connection with contested cases and appealable agency actions related to either:

(a) Applications for issuance or renewal of a certificate and discipline of certificate holders and noncertificated persons pursuant to sections 15-203, 15-505, 15-534, 15-534.01, 15-535, 15-545 and 15-550.

(b) The Arizona empowerment scholarship account program pursuant to title 15, chapter 19.

The board of fingerprinting.
The department of child safety except as provided in sections 8-506.01 and 8-811.

B. Unless waived by all parties, an administrative law judge shall conduct all hearings under this article, and the procedural rules set forth in this article and rules made by the director apply.

C. Except as provided in subsection A of this section:

A contested case heard by the office of administrative hearings regarding taxes administered under title 42 shall be subject to section 42-1251.
A final decision of the office of administrative hearings regarding taxes administered under title 42 may be appealed by either party to the director of the department of revenue, or a taxpayer may file and appeal directly to the board of tax appeals pursuant to section 42-1253.

D. Except as provided in subsections A, B, E, F and G of this section and notwithstanding any other administrative proceeding or judicial review process established in statute or administrative rule, this article applies to all appealable agency actions and to all contested cases.

E. Except for a contested case or an appealable agency action regarding unclaimed property, sections 41-1092.03, 41-1092.08 and 41-1092.09 do not apply to the department of revenue.

F. The board of appeals established by section 37-213 is exempt from:

The time frames for hearings and decisions provided in section 41-1092.05, subsection A, section 41-1092.08 and section 41-1092.09.
The requirement in section 41-1092.06, subsection A to hold an informal settlement conference at the appellant's request if the sole subject of an appeal pursuant to section 37-215 is the estimate of value reported in an appraisal of lands or improvements.

G. Auction protest procedures pursuant to title 37, chapter 2, article 4.1 are exempt from this article.

§ 41-1092.03 Notice of appealable agency action or contested case; hearing; informal settlement conference; applicability

A. Except as provided in subsection D of this section, an agency shall serve notice of an appealable agency action or contested case pursuant to section 41-1092.04. The notice shall:

Identify the statute or rule that is alleged to have been violated or on which the action is based.
Identify with reasonable particularity the nature of any alleged violation, including, if applicable, the conduct or activity constituting the violation.
Include a description of the party's right to request a hearing on the appealable agency action or contested case.
Include a description of the party's right to request an informal settlement conference pursuant to section 41-1092.06.

B. A party may obtain a hearing on an appealable agency action or contested case by filing a notice of appeal or request for a hearing with the agency within thirty days after receiving the notice prescribed in subsection A of this section. The notice of appeal or request for a hearing may be filed by a party whose legal rights, duties or privileges were determined by the appealable agency action or contested case. A notice of appeal or request for a hearing also may be filed by a party who will be adversely affected by the appealable agency action or contested case and who exercised any right provided by law to comment on the action being appealed or contested, provided that the grounds for the notice of appeal or request for a hearing are limited to issues raised in that party's comments. The notice of appeal or request for a hearing shall identify the party, the party's address, the agency and the action being appealed or contested and shall contain at least the following:

A concise statement of the reasons for the appeal or request for a hearing.
Detailed and complete information regarding all questions of law, if applicable, that are the basis for the appeal.
All relevant supporting documentation.
How the party is an adversely affected party, if applicable.

C. The agency shall notify the office of the appeal or request for a hearing and the office shall schedule an appeal or contested case hearing pursuant to section 41-1092.05, except as provided in section 41-1092.01, subsection F.

D. If good cause is shown an agency head may accept an appeal or request for a hearing that is not filed in a timely manner.

E. This section does not apply to a contested case if the agency:

Initiates the contested case hearing pursuant to law other than this chapter and not in response to a request by another party.
Is not required by law, other than this chapter, to provide an opportunity for an administrative hearing before taking action that determines the legal rights, duties or privileges of an applicant for a license.

§ 41-1092.04 Service of documents

Unless otherwise provided in this article, every notice or decision under this article shall be served by personal delivery or certified mail, return receipt requested, or by any other method reasonably calculated to effect actual notice on the agency and every other party to the action to the party's last address of record with the agency. Each party shall inform the agency and the office of any change of address within five days of the change.

§ 41-1092.05 Scheduling of hearings; prehearing conferences

A. Except as provided in subsections B and C, hearings for:

Appealable agency actions shall be held within sixty days after the notice of appeal is filed.
Contested cases shall be held within sixty days after the agency's request for a hearing.

B. Hearings for appealable agency actions of or contested cases with self-supporting regulatory boards that meet quarterly or less frequently shall be held at the next meeting of the board after the board receives the written decision of an administrative law judge or the issuance of the notice of hearing, except that:

If the decision of the administrative law judge is received or the notice of hearing is issued within thirty days before the board meets, the hearing shall be held at the following meeting of the board.
If good cause is shown, the hearing may be held at a later meeting of the board.

C. The date scheduled for the hearing may be advanced or delayed on the agreement of the parties or on a showing of good cause.

D. The agency shall prepare and serve a notice of hearing on all parties to the appeal or contested case at least thirty days before the hearing. The notice shall include:

A statement of the time, place and nature of the hearing.
A statement of the legal authority and jurisdiction under which the hearing is to be held.
A reference to the particular sections of the statutes and rules involved.
A short and plain statement of the matters asserted. If the agency or other party is unable to state the matters in detail at the time the notice is served, the initial notice may be limited to a statement of the issues involved. After the initial notice and on application, a more definite and detailed statement shall be furnished.

E. Notwithstanding subsection D, a hearing shall be expedited as provided by law or upon a showing of extraordinary circumstances or the possibility of irreparable harm if the parties to the appeal or contested case have actual notice of the hearing date. Any party to the appeal or contested case may file a motion with the director asserting the party's right to an expedited hearing. The right to an expedited hearing shall be listed on any abatement order. The Arizona health care cost containment system administration may file a motion with every member grievance and eligibility appeal that cites federal law and that requests that a hearing be set within thirty days after the motion is filed.

F. Prehearing conferences may be held to:

Clarify or limit procedural, legal or factual issues.
Consider amendments to any pleadings.
Identify and exchange lists of witnesses and exhibits intended to be introduced at the hearing.
Obtain stipulations or rulings regarding testimony, exhibits, facts or law.
Schedule deadlines, hearing dates and locations if not previously set.
Allow the parties opportunity to discuss settlement.

§ 41-1092.06 Appeals of agency actions and contested cases; informal settlement conferences; applicability

A. If requested by the appellant of an appealable agency action or the respondent in a contested case, the agency shall hold an informal settlement conference within fifteen days after receiving the request. A request for an informal settlement conference shall be in writing and shall be filed with the agency no later than twenty days before the hearing. If an informal settlement conference is requested, the agency shall notify the office of the request and the outcome of the conference, except as provided in section 41-1092.01, subsection F. The request for an informal settlement conference does not toll the sixty day period in which the administrative hearing is to be held pursuant to section 41-1092.05.

B. If an informal settlement conference is held, a person with the authority to act on behalf of the agency must represent the agency at the conference. The agency representative shall notify the appellant in writing that 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 shall waive their right to object to the participation of the agency representative in the final administrative decision.

§ 41-1092.07 Hearings

A. A party to a contested case or appealable agency action is entitled to one peremptory change of administrative law judge. A party to a contested case or appealable agency action shall also be authorized to file a nonperemptory motion with the director to disqualify an administrative law judge from conducting a hearing for bias, prejudice, personal interest, conflict of interest, being a material witness in the action or lack of technical expertise necessary for a hearing.

B. The parties to a contested case or appealable agency action have the right to be represented by counsel or to proceed without counsel, to submit evidence and to cross-examine witnesses.

C. The administrative law judge may issue subpoenas to compel the attendance of witnesses and the production of documents. The subpoenas shall be served and, on application to the superior court, enforced in the manner provided by law for the service and enforcement of subpoenas in civil matters. The administrative law judge may administer oaths and affirmations to witnesses.

D. All parties shall have the opportunity to respond and present evidence and argument on all relevant issues. All relevant evidence is admissible, but the administrative law judge may exclude evidence if its probative value is outweighed by the danger of unfair prejudice, by confusion of the issues or by considerations of undue delay, waste of time or needless presentation of cumulative evidence. The administrative law judge shall exercise reasonable control over the manner and order of cross-examining witnesses and presenting evidence to make the cross-examination and presentation effective for ascertaining the truth, avoiding needless consumption of time and protecting witnesses from harassment or undue embarrassment.

E. All hearings shall be recorded. The administrative law judge shall secure either a court reporter or an electronic means of producing a clear and accurate record of the proceeding at the agency's expense. Any party that requests a transcript of the proceeding shall pay the costs of the transcript to the court reporter or other transcriber.

F. Unless otherwise provided by law, the following apply:

A hearing may be conducted in an informal manner and without adherence to the rules of evidence required in judicial proceedings. Neither the manner of conducting the hearing nor the failure to adhere to the rules of evidence required in judicial proceedings is grounds for reversing any administrative decision or order if the evidence supporting the decision or order is substantial, reliable and probative.
Copies of documentary evidence may be received in the discretion of the administrative law judge. On request, the parties shall be given an opportunity to compare the copy with the original.
Notice may be taken of judicially cognizable facts. In addition, notice may be taken of generally recognized technical or scientific facts within the agency's specialized knowledge. The parties shall be notified either before or during the hearing or by reference in preliminary reports or otherwise of the material noticed, including any staff memoranda or data and they shall be afforded an opportunity to contest the material so noticed. The agency's experience, technical competence and specialized knowledge may be used in the evaluation of the evidence. An agency-issued license that substantially complied with the applicable licensing requirements establishes a prima facie demonstration that the license meets all state and federal legal and technical requirements and the license would protect public health, welfare and the environment. An adversely affected party may rebut a prima facie demonstration by presenting clear and convincing evidence demonstrating that one or more provisions in the license violate a specifically applicable state or federal requirement. If an adversely affected party rebuts a prima facie demonstration, the applicant or licensee and the agency director may present additional evidence to support issuing the license.
On application of a party or the agency and for use as evidence, the administrative law judge may allow a deposition to be taken, in the manner and on the terms designated by the administrative law judge, of a witness who cannot be subpoenaed or who is unable to attend the hearing. The administrative law judge may order subpoenas for the production of documents if the party seeking the discovery demonstrates that the party has reasonable need of the materials being sought. All provisions of law compelling a person under subpoena to testify are applicable. Fees for attendance as a witness shall be the same as for a witness in court, unless otherwise provided by law or agency rule. Notwithstanding section 12-2212, subpoenas, depositions or other discovery shall not be allowed except as provided by this paragraph or subsection C of this section.
Informal disposition may be made by stipulation, agreed settlement, consent order or default.
Findings of fact shall be based exclusively on the evidence and on matters officially noticed.
A final administrative decision shall include findings of fact and conclusions of law, separately stated. Findings of fact, if set forth in statutory language, shall be accompanied by a concise and explicit statement of the underlying facts supporting the findings. Conclusions of law shall specifically address the agency's authority to make the decision consistent with section 41-1030.

G. Except as otherwise provided by law:

At a hearing on an agency's denial of a license or permit or a denial of an application or request for modification of a license or permit, the applicant has the burden of persuasion.
At a hearing on an agency action to suspend, revoke, terminate or modify on its own initiative material conditions of a license or permit, the agency has the burden of persuasion.
At a hearing on an agency's imposition of fees or penalties or any agency compliance order, the agency has the burden of persuasion.
At a hearing held pursuant to chapter 23 or 24 of this title, the appellant or claimant has the burden of persuasion.

H. Subsection G of this section does not affect the law governing burden of persuasion in an agency denial of, or refusal to issue, a license renewal.

§ 41-1092.08 Final administrative decisions; review; exception

A. The administrative law judge of the office shall issue a written decision within twenty days after the hearing is concluded. The written decision shall contain a concise explanation of the reasons supporting the decision, including the findings of fact and conclusions of law. The administrative law judge shall serve a copy of the decision on all parties to the contested case or appealable agency action. On request of the agency, the office shall also transmit to the agency the record of the hearing as described in section 12-904, except as provided in section 41-1092.01, subsection F.

B. Within thirty days after the date the office sends a copy of the administrative law judge's decision to the head of the agency, executive director, board or commission, the head of the agency, executive director, board or commission may review the decision and accept, reject or modify it. If the head of the agency, executive director, board or commission declines to review the administrative law judge's decision, the agency shall serve a copy of the decision on all parties. If the head of the agency, executive director, board or commission rejects or modifies the decision, the agency head, executive director, board or commission must file with the office, except as provided in section 41-1092.01, subsection F, and serve on all parties 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.

C. A board or commission whose members are appointed by the governor may review the decision of the agency head, as provided by law, and make the final administrative decision.

D. Except as otherwise provided in this subsection, if the head of the agency, the executive director or a board or commission does not accept, reject or modify the administrative law judge's decision within thirty days after the date the office sends a copy of the administrative law judge's decision to the head of the agency, executive director, board or commission, as evidenced by receipt of such action by the office by the thirtieth day, the office shall certify the administrative law judge's decision as the final administrative decision. If the board or commission meets monthly or less frequently, if the office sends the administrative law judge's decision at least thirty days before the next meeting of the board or commission and if the board or commission does not accept, reject or modify the administrative law judge's decision at the next meeting of the board or commission, as evidenced by receipt of such action by the office within five days after the meeting, the office shall certify the administrative law judge's decision as the final administrative decision.

E. For the purposes of subsections B and D of this section, a copy of the administrative law judge's decision is sent on personal delivery of the decision or five days after the decision is mailed to the head of the agency, executive director, board or commission.

F. The decision of the agency head is the final administrative decision unless one of the following applies:

The agency head, executive director, board or commission does not review the administrative law judge's decision pursuant to subsection B of this section or does not reject or modify the administrative law judge's decision as provided in subsection D of this section, in which case the administrative law judge's decision is the final administrative decision.
The decision of the agency head is subject to review pursuant to subsection C of this section.
The licensee accepts the administrative law judge's decision concerning the appeal of a licensing decision as final pursuant to subsection I of this section.

G. If a board or commission whose members are appointed by the governor makes the final administrative decision as an administrative law judge or on review of the decision of the agency head, the decision is not subject to review by the head of the agency.

H. A party may appeal a final administrative decision pursuant to title 12, chapter 7, article 6, except as provided in section 41-1092.09, subsection B and except that if a party has not requested a hearing on receipt of a notice of appealable agency action pursuant to section 41-1092.03, the appealable agency action is not subject to judicial review. The license is not stayed during the appeal unless the affected party that has appealed applies to the superior court for an order requiring a stay pending final disposition of the appeal as necessary to prevent an imminent and substantial endangerment to public health or the environment. The court shall determine the matter under the standards applicable for granting preliminary injunctions.

I. Except for a licensing decision concerning the administrative completeness of an application submitted by a licensee or a licensing decision where the agency, executive director, board or commission has determined that the licensee poses a threat of grave harm or danger to the public or has acted with complete disregard for the well-being of the public in engaging or in being allowed to engage in the licensee's regulated business activity, for any appealable agency action or contested case involving a licensing decision, the licensee may accept the decision not more than ten days after receiving the administrative law judge's written decision. If the licensee accepts the administrative law judge's written decision, the decision shall be certified as the final decision by the office. If the licensee does not accept the administrative law judge's written decision as the final decision in the matter, the head of the agency, executive director, board or commission may review the decision and accept, reject or modify the decision. If the head of the agency, executive director, board or commission intends to reject or modify the decision, the parties shall meet and confer, within thirty days after receiving the administrative law judge's decision pursuant to subsection A of this section, concerning the agency's proposed modifications to the findings of fact and conclusions of law. Within twenty days after conferring, the head of the agency, executive director, board or commission shall file its final decision in accordance with subsection B of this section. This subsection does not apply to any appealable agency actions of the department of water resources pursuant to title 45.

J. This section does not apply to the Arizona peace officer standards and training board established by section 41-1821.

§ 41-1092.09 Rehearing or review

A. Except as provided in subsection B of this section:

A party may file a motion for rehearing or review within thirty days after service of the final administrative decision.
The opposing party may file a response to the motion for rehearing within fifteen days after the date the motion for rehearing is filed.
After a hearing has been held and a final administrative decision has been entered pursuant to section 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.

B. A party to an appealable agency action of or contested case with a self-supporting regulatory board shall exhaust the party's administrative remedies by filing a motion for rehearing or review within thirty days after the service of the administrative decision that is subject to rehearing or review in order to be eligible for judicial review pursuant to title 12, chapter 7, article 6. The board shall notify the parties in the administrative decision that is subject to rehearing or review that a failure to file a motion for rehearing or review within thirty days after service of the decision has the effect of prohibiting the parties from seeking judicial review of the board's decision.

C. Service is complete on personal service or five days after the date that the final administrative decision is mailed to the party's last known address.

D. Except as provided in this subsection, the agency head, executive director, board or commission shall rule on the motion within fifteen 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. A self-supporting regulatory board shall rule on the motion within fifteen days after the response to the motion is filed or at the board's next meeting after the motion is received, whichever is later.

§ 41-1092.10 Compulsory testimony; privilege against self-incrimination

A. A person may not refuse to attend and testify or produce evidence sought by an agency in an action, proceeding or investigation instituted by or before the agency on the ground that the testimony or evidence, documentary or otherwise, required of the person may tend to incriminate the person or subject the person to a penalty or forfeiture unless it constitutes the compelled testimony or the private papers of the person that would be privileged evidence either pursuant to the fifth amendment of the Constitution of the United States or article II, section 10, Constitution of Arizona, and the person claims the privilege before the production of the testimony or papers.

B. If a person asserts the privilege against self-incrimination and the agency seeks to compel production of the testimony or documents sought, the office or agency as provided in section 41-1092.01, subsection F may issue, with the prior written approval of the attorney general, a written order compelling the testimony or production of documents in proceedings and investigations before the office or agency as provided in section 41-1092.01, subsection F or apply to the appropriate court for such an order in other actions or proceedings.

C. Evidence produced pursuant to subsection B of this section is not admissible in evidence or usable in any manner in a criminal prosecution, except for perjury, false swearing, tampering with physical evidence or any other offense committed in connection with the appearance made pursuant to this section against the person testifying or the person producing the person's private papers.

§ 41-1092.11 Licenses; renewal; revocation; suspension; annulment; withdrawal

A. If a licensee makes timely and sufficient application for the renewal of a license or a new license with reference to any activity of a continuing nature, the existing license does not expire until the application has been finally determined by the agency, and, in case the application is denied or the terms of the new license limited, until the last day for seeking review of the agency order or a later date fixed by order of the reviewing court.

B. Revocation, suspension, annulment or withdrawal of any license is not lawful unless, before the action, the agency provides the licensee with notice and an opportunity for a hearing in accordance with this article. If the agency finds that the public health, safety or welfare imperatively requires emergency action, and incorporates a finding to that effect in its order, the agency may order summary suspension of a license pending proceedings for revocation or other action. These proceedings shall be promptly instituted and determined.

§ 41-1092.12 Private right of action; recovery of costs and fees; definitions

A. If an agency takes an action against a party that is arbitrary, capricious or not in accordance with law, the action is an appealable agency action if all of the following apply:

Within ten days after receiving notification of the action that is arbitrary, capricious or not in accordance with law, the party notifies the director of the agency in writing of the party's intent to file a claim pursuant to this section. This notice shall include a description of the action the party claims to be arbitrary, capricious or not in accordance with law and reasons why the action is arbitrary, capricious or not in accordance with law.
The agency continues the action that is arbitrary, capricious or not in accordance with law more than ten days after the agency receives the notice.
The action is not excluded from the definition of appealable agency action as defined in section 41-1092.

B. This section only applies if an administrative remedy or an administrative or a judicial appeal of final agency action is not otherwise provided by law.

C. If the party prevails, the agency shall pay reasonable costs and fees to the party from any monies appropriated to the agency and available for that purpose or from other operating monies of the agency. If the agency fails or refuses to pay the award within fifteen days after the demand, and if no further review or appeal of the award is pending, the prevailing party may file a claim with the department of administration. The department of administration shall pay the claim within thirty days in the same manner as an uninsured property loss under chapter 3.1, article 1 of this title, except that the agency is responsible for the total amount awarded and shall pay it from its operating monies. If the agency had appropriated monies available for paying the award at the time it failed or refused to pay, the legislature shall reduce the agency's operating appropriation for the following fiscal year by the amount of the award and shall appropriate that amount to the department of administration as reimbursement for the loss.

D. If the administrative law judge determines that the appealable agency action is frivolous, the administrative law judge may require the party to pay reasonable costs and fees to the agency in responding to the appeal filed before the office of administrative hearings.

E. Notwithstanding any other law, a licensee may forgo an administrative appeal and seek judicial review of an agency's grant, denial, modification or revocation of a permit issued pursuant to title 49.

F. For the purposes of this section:

"Action against the party" means any of the following that results in the expenditure of costs and fees:

(a) A decision.

(b) An inspection.

(d) The entry of private property.

(e) A notice of violation.

"Agency" means the department of environmental quality established pursuant to title 49, chapter 1, article 1.
"Costs and fees" means reasonable attorney and professional fees.
"Notice of violation" means a written notice issued after an inspection or investigation pursuant to section 41-1009 that documents and communicates an alleged deficiency meeting one or more of the criteria listed in section 41-1009, subsection E.
"Party" means an individual, partnership, corporation, association and public or private organization at whom the action was directed and who has expended costs and fees as a result of the action against the party.

Article 11 Occupational Regulation

§ 41-1093 Definitions

In this article, unless the context otherwise requires:

"Health, safety or welfare":

(a) Means the protection of members of the public against harm, fraud or loss, including the preservation of public security, order or health.

(b) Does not include the protection of existing businesses or agencies, whether publicly or privately owned, against competition.

"Individual" means a natural person.
"Occupational regulation":

(a) Means a rule, regulation, practice or policy that allows an individual to use an occupational title or work in a lawful occupation, trade or profession or a cease and desist demand or other regulatory requirement that prevents an individual from using an occupational title or working in a lawful occupation, trade or profession.

(b) Does not include:

(i) A business license, facility license, building permit or zoning and land use regulation.

(ii) Any rule or regulation relating to an institution or individual that is subject to title 36, chapter 4, article 10 or chapter 20.

(iii) Any license or regulation that is required by federal law.

(iv) Any rule or regulation adopted by an agency that is authorized by statute and has been approved by the council pursuant to section 41-1052.

(v) Any rule or regulation relating to emergency medical and transportation services that originated with a public access system or medical transportation requested by a medical authority or by the patient for which a certificate of necessity is required under section 36-2233.

(vi) Any rule relating to the licensing of a securities dealer, securities salesman, investment adviser or investment adviser representative.

§ 41-1093.01 Occupational regulations; limitations

An agency shall limit all occupational regulations to regulations that are demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern.

§ 41-1093.02 Administrative proceedings

A. Any individual harmed by an occupational regulation may petition an agency to repeal or modify any occupational regulation within the agency's jurisdiction.

B. Within ninety days after a petition is filed, the agency shall repeal the occupational regulation, modify the occupational regulation to comply with section 41-1093.01, recommend legislative action, if required, to repeal or amend the occupational regulation to comply with section 41-1093.01 or state the basis on which the agency concludes that the occupational regulation complies with section 41-1093.01.

§ 41-1093.03 Enforcement; fees and costs

A. Whether or not a petition is filed pursuant to section 41-1093.02, any individual may file an action in a court of general jurisdiction to challenge an occupational regulation.

B. To prevail in an action challenging the occupational regulation, the court must find by a preponderance of the evidence that the challenged occupational regulation on its face or in its effect burdens the entry into or participation in an occupation, trade or profession and that this state has failed to prove by a preponderance of the evidence that the challenged occupational regulation is demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern.

C. If the court finds for the plaintiff, the court shall enjoin further enforcement of the challenged occupational regulation and shall award reasonable attorney fees and costs to the plaintiff.

§ 41-1093.04 Occupational license, permit or certificate or other state recognition rights; petition for review of criminal record; annual report

A. A person with a criminal record may petition an agency, at any time, including before obtaining any required education or experience, taking any examination or paying any fee, for a determination of whether the person's criminal record disqualifies the person from obtaining a license, permit, certificate or other state recognition.

B. In the petition, the person shall include:

The person's complete criminal history record or authorization for the agency to obtain the person's criminal history record.
Any additional information about the person's current circumstances, including the time since the offense was committed and the sentence was completed, the payment of any court-ordered restitution, evidence of rehabilitation, testimonials, employment history and employment aspirations.

C. The agency shall determine whether the person's criminal record disqualifies the person from obtaining a license, permit, certificate or other state recognition.

D. Notwithstanding any other law or rule, when making a determination regarding the person's petition, the agency may determine that the person's criminal record disqualifies the person from obtaining a license, permit, certificate or other state recognition only if the agency concludes that this state has an important interest in protecting public safety that is superior to the person's right and either of the following applies:

The person was convicted of any of the following, the conviction occurred within three years before the date of the petition, excluding any period of time that the person was imprisoned in the custody of the state department of corrections, and the conviction has not been set aside or sealed:

(a) A felony offense.

(b) A violent crime as defined in section 13-901.03.

(c) An offense included in title 13, chapter 20, 21 or 22 or section 13-2310 or 13-2311 if the license, permit, certificate or other state recognition is for an occupation in which the applicant would owe a fiduciary duty to a client.

The person was, at any time, convicted of either of the following:

(a) An offense that a law specifically requires the agency to consider when issuing a license, permit, certificate or other state recognition and the conviction has not been set aside or sealed.

(b) A dangerous offense as defined in section 13-105, a serious offense as defined in section 13-706, a dangerous crime against children as defined in section 13-705 or an offense included in title 13, chapter 14 or 35.1, and the conviction has not been set aside or sealed.

E. To conclude that the state has an important interest in protecting public safety that is superior to the person's right, as required by subsection D of this section, the agency must determine by clear and convincing evidence at the time of the petition that both of the following apply:

The specific offense that the person was convicted of:

(a) For an occupational or professional licensing board or a health profession regulatory board, substantially relates to the occupation or approval would pose a reasonable threat to public health and safety as prescribed by section 41-1093.08.

(b) For all other agencies, substantially relates to this state's interest and specifically and directly relates to the duties and responsibilities of the occupation, except offenses involving moral turpitude.

The person, based on the nature of the specific offense that the person was convicted of and the person's current circumstances, including the passage of time since the person committed the offense and any evidence of rehabilitation or treatment, is more likely to reoffend by virtue of having the license, permit, certificate or other state recognition than if the person did not have the license, permit, certificate or other state recognition.

F. In determining if a person's criminal record disqualifies the person from obtaining a license, permit, certificate or other state recognition pursuant to subsection D of this section, the agency may not consider negatively any of the following:

Nonconviction information, including information related to a deferred adjudication, participation in a diversion program or an arrest that was not followed by a conviction.
A conviction that has been sealed, dismissed, expunged or pardoned.
A juvenile adjudication.
A nonviolent misdemeanor.
Whether the person would qualify for a fingerprint clearance card issued pursuant to chapter 12, article 3.1 of this title without a good cause exception.

G. The agency shall issue a determination on the petition within ninety days after the agency receives the petition. The determination on the petition must be in writing and include all of the following:

Findings of fact and conclusions of law.
The grounds and reasons for the determination if the person's criminal history disqualifies the person.

H. If the agency determines that the state's interest to protect public safety is superior to the person's right, the agency shall advise the person of the actions that the person may take to remedy the disqualification, including:

An appeal of the determination as provided in title 12, chapter 7, article 6.
The earliest date the person may submit a new petition to the agency, which must be not later than two years after the final determination of the initial petition.

I. Subject to section 41-1093.08, if applicable, the agency shall rescind the determination any time after the determination is made but before issuing a license, permit, certificate or other state recognition if the person is convicted of an additional offense that is included in subsection D of this section.

J. Subsection D and subsection F, paragraphs 1, 2 and 4 of this section do not apply to any of the following:

Any law enforcement agency or the Arizona peace officer standards and training board.
Any license or registration certificate that is issued pursuant to title 32, chapter 24 or 26.
Any certification, license or permit that is issued pursuant to title 15.
Statutory requirements for a fingerprint clearance card issued pursuant to chapter 12, article 3.1 of this title.
Any criteria for license, permit or certificate eligibility that is established by an interstate compact.

K. Each agency shall submit a report on or before July 1 of each year to the governor and the legislature, provide a copy of this report to the secretary of state and post the report on the agency's website. The report shall include the following information for the previous calendar year:

The number of applicants who petitioned the agency for a determination.
The number of petitions that were granted and the types of offenses at issue.
The number of petitions that were denied and the types of offenses at issue.
The number of determinations that were rescinded.

L. An agency shall adopt forms for petitions as prescribed in subsections A and B of this section.

§ 41-1093.05 License applicants; notice

An agency shall prominently post the following on the agency's website and print on a license application, a communication denying a license, a cease and desist order or any other communication in which the agency asserts that a person is required to obtain a license:

Notice:

Pursuant to section 41-1093.01, Arizona Revised Statutes, an agency shall limit all occupational regulations to regulations that are demonstrated to be necessary to specifically fulfill a public health, safety or welfare concern. Pursuant to sections 41-1093.02 and 41-1093.03, Arizona Revised Statutes, you have the right to petition this agency to repeal or modify the occupational regulation or bring an action in a court of general jurisdiction to challenge the occupational regulation and to ensure compliance with section 41-1093.01, Arizona Revised Statutes.

§ 41-1093.06 Occupational licenses; drug offense conviction; eligibility; exceptions; definition

A. Notwithstanding any other law, an agency may not deny to an otherwise qualified applicant who has been convicted of an offense that involves a violation of title 13, chapter 34 or 34.1 or an offense committed in another jurisdiction that has the same elements as an offense listed in title 13, chapter 34 or 34.1 either of the following:

The regular occupational license for which the applicant applied.
A provisional occupational license.

B. This section does not apply to the following:

The state board of education for the purposes of certification of persons pursuant to section 15-501.01.
A health profession regulatory board as defined in section 32-3201.
The department of health services for the purposes of title 36, chapter 28.1.
A law enforcement agency and the Arizona peace officer standards and training board.

C. For the purposes of this section, "occupational license" means any agency permit, certificate, approval, registration or charter or any similar form of permission that allows an individual to use an occupational title or work in a lawful occupation, trade or profession.

§ 41-1093.07 Private employers; effect of article

This article does not:

Require a private employer to grant or deny employment to any individual.
Impair the right of private employers to establish and enforce eligibility criteria, ethics codes or disciplinary policies.

§ 41-1093.08 Occupational or professional licensing boards; health profession regulatory boards; denial, suspension or revocation; prior criminal offense; review; procedures; notice; definitions

A. Notwithstanding any other law, an occupational or professional licensing board or health profession regulatory board may not deny, suspend or revoke a license, registration or certificate for an applicant's, licensee's, registrant's or certificate holder's prior criminal offense unless either:

The offense is substantially related to the occupation.
Approving or not imposing disciplinary action against the license, registration or certificate would pose a reasonable threat to public health and safety.

B. In addition to other available remedies, an applicant, licensee, registrant or certificate holder may petition the office of administrative hearings to request a review of a denial, suspension or revocation of a license, registration or certificate for a prior criminal offense. A petition submitted pursuant to this subsection may not be more than five double-spaced pages. Review hearings shall be confidential and conducted in an informal manner. Article 10 of this chapter does not apply to reviews requested pursuant to this subsection.

C. On receipt of a properly submitted petition pursuant to subsection B of this section, the office of administrative hearings shall review the denial, suspension or revocation and determine whether the offense is substantially related to the applicant's, licensee's, registrant's or certificate holder's occupation or if approving or not imposing a disciplinary action against the license, registration or certificate would pose a reasonable threat to public health and safety. Questions from the office of administrative hearings shall be limited to only matters specified in the petition.

D. Each occupational or professional licensing board or health profession regulatory board shall post prominently on the board's website and on each license, registration or certificate denial a notice of an individual's right to petition the office of administrative hearings for review pursuant to this section.

E. This section does not impact a person's right to petition an agency for a criminal record review pursuant to section 41-1093.04 or an agency's requirement to determine whether the person's criminal record disqualifies the person from obtaining a license, permit, certificate or other state recognition.

F. For the purposes of this section:

"Health profession regulatory board" has the same meaning prescribed in section 32-3201.
"Reasonable threat" means the criminal conduct the person was convicted of involved an act or threat of harm against another person and has a direct bearing on the person's ability to safely serve the public or work with others in the occupation.
"Substantially related" means has a direct bearing on the ability to perform any duties or responsibilities related to the occupation.

Chapter 6.1 Rulemaking Review

Article 1 General Provisions

§ 41-1095 Review by agency; definitions

A. For an agency that the legislature has granted a one-time rulemaking exemption, within one year after a rule has been adopted the agency shall review the rule adopted under the rulemaking exemption to determine whether any rule adopted under the rulemaking exemption should be amended or repealed. The agency shall prepare and obtain council approval of a written report summarizing its findings, its supporting reasons and any proposed course of action. The report shall contain a certification that the agency is in compliance with section 41-1091. The report shall include a concise analysis of all of the following:

The rule's effectiveness in achieving its objectives, including a summary of any available data supporting the conclusions reached.
Written criticisms of the rule received since the rule was adopted, including any written analyses submitted to the agency questioning whether the rule is based on valid scientific or reliable principles or methods.
Authorization of the rule by existing statutes.
Whether the rule is consistent with statutes or other rules made by the agency and current agency enforcement policy.
The clarity, conciseness and understandability of the rule.
The estimated economic, small business and consumer impact of the rule.
Any analysis submitted to the agency by another person regarding the rule's impact on this state's business competitiveness as compared to the competitiveness of businesses in other states.
If applicable, that the agency completed any additional process required by law, including the requirement for the agency to publish otherwise exempt rules or provide the public with an opportunity to comment on the rules.
A determination that the probable benefits of the rule outweigh within this state the probable costs of the rule, and the rule 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.
A determination that the rule is not more stringent than a corresponding federal law unless there is statutory authority to exceed the requirements of that federal law.
For rules that require the issuance of a regulatory permit, license or agency authorization, whether the rule complies with section 41-1037.

B. An agency may also include as part of the report the text of a proposed expedited rule pursuant to section 41-1027.

C. The council may require the agency to propose an amendment or repeal of the rule by a date not earlier than six months after the date of the meeting at which the council considers the agency's report on its rule if the council determines the agency's analysis under subsection A of this section demonstrates that the rule is materially flawed, including that the rule:

Is not authorized by statute.
Is inconsistent with other statutes, rules or agency enforcement policies and the inconsistency results in a significant burden on the regulated public.
Imposes probable costs, including costs to the regulated person, that significantly exceed the probable benefits of the rule within this state.
Is more stringent than a corresponding federal law and there is no statutory authority to exceed the requirements of federal law.
Is not clear, concise and understandable.
Does not use general permits if required under section 41-1037.
Does not impose the least burden to persons regulated by the rule as necessary to achieve the underlying regulatory objective of the rule.
Does not rely on valid scientific or reliable principles and methods, including a study, if the rule relies on scientific principles or methods, and a person has submitted an analysis under subsection A of this section questioning whether the rule is based on valid scientific or reliable principles or methods. In making a determination of validity or reliability, the council shall consider the factors listed in section 41-1052, subsection G.

D. An agency may request an extension of not longer than six months from the date specified by the council pursuant to subsection C of this section by sending a written request to the council that:

Identifies the reason for the extension request.
Demonstrates good cause for the extension.

E. The agency shall notify the council of an amendment or repeal of a rule for which the council has set an expiration date under subsection C of this section. If the agency does not amend or repeal the rule by the date specified by the council under subsection C of this section or the extended date under subsection D of this section, the rule automatically expires. The council shall file a notice of rule expiration with the secretary of state and notify the agency of the expiration of the rule.

F. If an agency finds that it cannot provide the written report to the council by the date it is due, the agency may file an extension with the council before the due date indicating the reason for the extension. The timely filing for an extension permits the agency to submit its report on or before the date prescribed by the council.

G. If an agency fails to submit its report pursuant to subsection A of this section, or file an extension before the due date of the report or if it files an extension and does not submit its report within the extension period, the rule expires and the council shall:

Cause a notice to be published in the next register that states the rule has expired and is no longer enforceable.
Notify the secretary of state that the rule has expired and that the rule is to be removed from the code.
Notify the agency that the rule has expired and is no longer enforceable.

H. If a rule expires as provided in subsection G of this section and the agency wishes to reestablish the rule, the agency shall comply with the requirements of chapter 6 of this title.

I. At least ninety days before the due date of a report, the council shall send a written notice to the head of the agency whose report is due. The notice shall list the rule to be reviewed and the date the report is due.

J. For the purposes of this section, "agency", "council" and "rule" have the same meanings prescribed in section 41-1001.

Chapter 6.2 Rulemaking Exemptions

Article 1 General Provisions

§ 41-1097 Definitions

A. The definitions in section 41-1001 apply to this chapter.

B. In this chapter, unless the context otherwise requires:

"Notice of exempt rulemaking" means a notice of:

(a) An exemption pursuant to section 41-1005, except those exemptions that require notice and an opportunity for public comment.

(b) An exemption pursuant to section 41-1057.

(c) A rule adopted pursuant to an exemption, as provided exclusively to an agency in statute or session law, from all requirements of the act.

"Published" means a rulemaking that has been printed and distributed by an agency or posted on an agency's website or filed by an agency and published in the register or a combination of any of these requirements as provided in statute or session law.

§ 41-1097.01 Filing and publication of exempt rules

A. The secretary of state shall prescribe a uniform numbering system and have reasonable discretion to determine the form and style for exempt rules filed with and published by the secretary of state's office. The secretary of state shall refuse to accept a notice of exempt rulemaking if the notice or filing does not comply with the secretary of state's prescribed filing requirements, numbering system, form and style.

B. If an agency files a notice of exempt rulemaking, the secretary of state shall publish the notice in the register pursuant to the exemption requirements prescribed in statute or session law.

C. All exempt rules shall be codified and published in the code only as prescribed in statute or session law.

Chapter 7 Legislature

Article 1 Meeting and Organization

§ 41-1101 Time of assembly; organization; oaths

A. The legislature shall assemble at the seat of government at twelve o'clock noon on the second Monday of January each year.

B. At the hour of assemblage of the first regular session next after the general election the member of the senate holding seniority in age shall take the chair, call the senate to order, appoint a temporary secretary, and direct the secretary to call the list of senators from the several counties, who shall present their certificates of election and take the oath of office. The senate may thereupon, if a quorum is present, proceed to elect its officers. The house of representatives shall likewise proceed with its organization. The oath taken by the members shall be entered upon the journals of the respective houses.

C. The presiding officer of each house may administer the oath of office to members, officers and employees of the respective houses.

§ 41-1102 Officers and employees; appointment

A. The officers and employees of the senate shall consist of a president, a secretary and such other employees as the senate directs.

B. The officers and employees of the house of representatives shall be a speaker, a chief clerk and such other employees as the house directs.

§ 41-1103 Compensation; reimbursement of expenditures

A. Members of the legislature are each entitled to receive an annual salary established pursuant to the provisions of section 41-1904.

B. In addition to the salary provided in subsection A of this section, each member of the legislature shall also be reimbursed for travel and subsistence expenses incurred in attendance upon regular sessions or special sessions and for acting in a legislative matter, other than in a regular or special session, upon prior approval of the presiding officer of either house of the legislature at such rate and in such manner as may be prescribed by law.

§ 41-1104 Travel reimbursement and subsistence for members of legislature; claim required

A. Notwithstanding section 38-624, each member of the legislature shall be reimbursed for travel at the federal mileage reimbursement rate as determined annually by the United States general services administration, and such reimbursement shall include travel from the temporary or permanent residence of the member to the state capitol.

B. Each member of the legislature shall be paid for each day of subsistence during a regular or special session and for each day of subsistence when the member acts on a legislative matter, other than in a regular or special session, on the prior approval of the presiding officer of the house of which that member is a member in an amount as follows:

For a member whose permanent residence is within Maricopa county, $35.
For a member whose permanent residence is outside Maricopa county, one hundred percent of the average of the six highest months of the annual federal per diem rate for Maricopa county, including lodging, as determined by the United States general services administration. The director of the department of administration shall determine this amount annually.

C. Subsistence allowed to each member of the legislature during the regular session as provided in subsection B of this section shall be limited to the first one hundred twenty days of a regular session. After the first one hundred twenty days of a regular session, each member of the legislature whose permanent residence is within Maricopa county shall be paid the sum of $10 for subsistence for each day of the regular session beyond the first one hundred twenty days. Each member whose permanent residence is outside of Maricopa county shall receive fifty percent of the amount determined annually by the director of the department of administration pursuant to subsection B of this section for each day beyond the first one hundred twenty days of a regular session as subsistence.

D. Each member of the legislature may elect to opt out of receiving subsistence payments prescribed by subsections B and C of this section.

E. Each member of the legislature, for authorized travel out of state, shall receive travel and subsistence expenses as prescribed by law for state officers.

F. For payment of travel expenses and subsistence, as prescribed by the terms of this section, each member of the legislature shall submit a claim for travel expenses and subsistence that is countersigned by the presiding officer of the respective body.

§ 41-1105 Monies for promotion of state interests and public service; procedures; uses

A. The governor or either presiding officer of the legislature may accept and expend public or private gifts, grants, donations or monies for the purpose of promoting the interests of the state or to promote and encourage citizen public service to the state.

B. All monies received pursuant to subsection A of this section shall be deposited, pursuant to sections 35-146 and 35-147, and held and retained in separate state promotional fund accounts according to the specified source and purpose of the fund. Public and private monies shall not be commingled in any fund account.

C. The department of administration shall issue warrants for disbursements from any account established pursuant to this section on receipt of vouchers properly establishing the nature of the disbursement and on the signature of the person authorized to approve expenditures from the fund pursuant to section 35-149, subsection A, paragraph 4. The department of administration shall issue the warrants for disbursements from any account established pursuant to this section containing private monies without regard to any other restrictions or limits placed on expenditures of public monies by any other provision of law.

D. The person authorized pursuant to section 35-149, subsection A, paragraph 4 shall approve expenditures from accounts established pursuant to this section only to the extent that the expenditures are consistent with any terms and conditions under which the monies were received and for a purpose authorized by subsection A of this section.

E. Annually before January 1, the person authorized pursuant to section 35-149, subsection A, paragraph 4 shall prepare a written report to the governor and the legislature that includes a detailed listing naming the contributors to the accounts established pursuant to this section and a detailed listing of expenditures from the accounts established by this section. The report shall be considered a public record.

§ 41-1106 Records; debate and testimony; definition

Each house of the legislature shall keep, for a period of three years, an audiotape or verbatim transcription or other similar accurate record of debate and testimony occurring in committee and on the chamber floor. For purposes of this section "committee" includes standing committees, subcommittees, conference committees, interim committees and committees that are established by law or by either presiding officer.

§ 41-1107 Legislative intent clauses

All legislation that diminishes a previous grant of authority to a political subdivision of this state shall contain an intent clause that explains the reason for the diminution of authority.

Article 3 Standing Committees

§ 41-1131 Appointment

Standing committees of the legislature shall be appointed by the presiding officer of the respective houses, but each house may, by resolution or rule, direct otherwise.

§ 41-1132 Interim committee meetings; attendance at conferences; report

A. The president of the senate or speaker of the house of representatives may at any time when the legislature is not in session call a meeting of any standing legislative committee appointed according to law or rules of the house of which he is the presiding officer. The call shall state the time and place of meeting and the subject matter to be considered.

B. The presiding officer of either house may authorize any member of a standing committee of the house over which he presides to attend a conference or convention, either in the state or without the state, when such attendance, in the opinion of the presiding officer, will promote the best interests of the state.

C. Not less than ten days after convening the next session of the legislature following such a committee meeting, conference or convention, the chairman shall submit a written report of the committee's findings to the presiding officer of the house it represents.

§ 41-1133 Powers of committees at interim meetings

A committee called to meet under the provisions of section 41-1132 shall have the powers conferred by law upon legislative committees.

Article 4 Witnesses and Punishment of Contempts

§ 41-1151 Issuance and service of legislative subpoena

A subpoena may be issued by the presiding officer of either house or the chairman of any committee before whom the attendance of a witness is desired. The subpoena is sufficient if it states whether the proceeding is before the senate, house of representatives or a committee, is addressed to the witness, requires the attendance of the witness at a certain time and place, and is signed by either presiding officer or a committee chairman. The subpoena may be served and returned in like manner as civil process.

§ 41-1152 Immunity of witnesses

Testimony or evidence produced pursuant to this article may not be admitted in evidence or used in any manner in any criminal prosecution against a natural person sworn and examined before either house of the legislature or any committee of either house, except for perjury, false swearing, tampering with physical evidence or any other offense committed in connection with an appearance required by section 41-1151 if it constitutes either the compelled testimony or the private papers of such person which would be privileged evidence pursuant to the fifth amendment of the Constitution of the United States or article II, section 10 of the Constitution of Arizona and such person claimed the privilege against self-incrimination and a majority of the committee, after consultation with the attorney general, votes to order such person to testify or produce such papers.

§ 41-1153 Disobedience of subpoena as legislative contempt

A. If a witness neglects or refuses to obey a legislative subpoena, or, appearing, neglects or refuses to testify, the senate or the house may, by resolution entered in the journal, commit him for contempt.

B. A witness neglecting or refusing to attend in obedience to a subpoena may be arrested by the sergeant-at-arms and brought before the senate or house upon authority of a copy of the resolution signed by the president or speaker, and countersigned by the secretary or chief clerk.

§ 41-1154 Disobedience of legislative subpoena or refusal to give testimony or produce papers; classification

A person who, being subpoenaed to attend as a witness before either house of the legislature or any committee thereof, knowingly fails or refuses without lawful excuse to attend pursuant to such subpoena, or being present knowingly refuses to be sworn or to answer any material or proper question, or to produce, upon reasonable notice, any material and relevant books, papers or documents in his possession or under his control, is guilty of a class 2 misdemeanor.

§ 41-1155 Offenses punishable by legislature; limitation on imprisonment

A. Each house of the legislature may punish as a contempt, and by imprisonment, a breach of its privileges, or the privileges of its members, but only for one or more of the following offenses:

Arresting a member or officer of the house, or procuring such member or officer to be arrested, in violation of his privilege from arrest.
Disorderly conduct in immediate view of the house, and directly tending to interrupt its proceedings.
Refusing to attend, or to be examined as a witness, either before the house or a committee, or before any person authorized by the house or by a committee to take testimony in legislative proceedings.
Giving or offering a bribe to a member, or attempting by menace, or other corrupt means or device, directly or indirectly, to control or influence a member in giving or preventing his vote.

B. No term of imprisonment shall extend beyond final adjournment of the session.

Article 5 Legislative Printing

§ 41-1171 Legislative printing

A. The speaker of the house of representatives and the president of the senate may at any time jointly or separately contract for the purchase of legislative printing services as is deemed appropriate under conditions and requirements prescribed by the speaker and president.

B. The speaker of the house of representatives and president of the senate may jointly or separately prescribe the standards of quality, technical specifications, delivery arrangements and financial arrangements applicable to a contract for the purchase of legislative printing services.

C. The chief clerk of the house of representatives and the secretary of the senate shall maintain a copy of any current contract for legislative printing services applicable to the respective legislative body for public inspection during usual office hours.

D. If the speaker of the house of representatives and the president of the senate contract separately for the purchase of legislative printing services pursuant to this section, the speaker and president shall agree upon a uniform format applicable to both houses for the style of bills, resolutions and memorials of the legislature.

Article 5.1 Legislative Services

§ 41-1176.01 Sale of publications by legislature and legislative council

A. Copies of reports or any other publications not including legislative bills produced by the senate, the house of representatives or the legislative council may be sold to the public by the legislative body or agency by which they are produced.

B. Copies sold pursuant to this section shall be sold at a price sufficient to cover the cost of printing and binding such report or publication. All monies derived from the sale of such copies are appropriated and shall be credited to the appropriation account of the legislative body or agency by which they were received.

§ 41-1177 Distribution of statutes and session laws to legislators

A. On request, the legislature shall provide to any member one copy of the session laws and one set of the statutes and shall provide supplements of the statutes to the member during each year the member remains in office.

B. The legislature may provide for use by any employee authorized by the president of the senate or speaker of the house of representatives one copy of the session laws and one set of the statutes and supplements of the statutes.

§ 41-1177.01 Preparation of legislative journals; costs

A. Each house of the legislature shall prepare copies of its own legislative journal for each legislative session and superintend the printing of such journals. Proof sheets of such printing shall be compared to the originals and corrected prior to printing.

B. Each house shall bear the costs of printing its own journal.

§ 41-1177.03 Distribution and sale of legislative journals and session laws

A. The legislature shall supply to the director of the Arizona state library, archives and public records for the purpose of exchange with other states, territories, the United States and foreign countries the number of copies of the session laws and journals of the legislature as required pursuant to section 41-151.05.

B. The legislature shall sell printed copies of the session laws and journals to the public at a price equal to the cost of publishing and distributing each copy.

C. The senate shall provide to any member of the senate, at the member's request, a senate journal.

D. The house of representatives shall provide to any member of the house of representatives, at the member's request, a house journal.

Article 5.2 Agency Reports

§ 41-1178 Reports; audits; submission

A. If a statute or law requires an agency as defined in section 41-2952 or a person to submit a report, an audit or the report of a consultant that contracted with an agency to the legislature, the agency or person shall submit a copy of the report or audit to:

The president of the senate.
The speaker of the house of representatives.
The joint legislative audit committee.

B. The agency or person that submits a report, an audit or the report of a consultant that contracted with an agency to the legislature shall notify each legislator of the submission and that a copy of the report or audit shall be provided to the legislator on request.

C. Unless an exception to this subsection is specifically authorized by the director of the department of administration, all reports mandated by statute or law shall be printed in monochromatic ink.

Article 6 Approval or Veto of Legislative Acts

§ 41-1181 Endorsement and approval of bills

A. Every bill shall, as soon as delivered to the governor, be endorsed as follows:

"This bill was received by the governor this _____ day of _______."

B. The endorsement shall be signed by the secretary to the governor. When the governor approves a bill he shall sign his name thereto, with the date of approval.

§ 41-1182 Effect of failure of governor to approve or veto bill within certain time; certification of bill as law

If a bill has remained with the governor five days while the legislature is in session, or ten days after adjournment of the legislature, without approval or veto, the governor shall deliver the bill to the secretary of state, who shall certify thereon, if the legislature is in session as follows:

"This bill having remained with the governor five days, Sundays excluded, and the legislature being in session, it has become a law this _________ day of _____, 19."

If the legislature has adjourned the secretary of state shall certify thereon as follows:

"This bill having remained with the governor ten days, Sundays excluded, after final adjournment of the legislature, and not having been filed with his objections, has become a law this _________ day of _____, 19."

Article 7 Vacancies

§ 41-1201 Definition of vacancy

In this article, unless the context otherwise requires, "vacancy" means a vacancy as defined by section 38-291 and includes a vacancy which occurs before the person has taken the oath of office as provided by section 41-1101.

§ 41-1202 Vacancy in legislature; precinct committeemen; appointment; definition

A. If a vacancy occurs or exists in the legislature and the vacant seat was represented by a political party that is organized pursuant to title 16, chapter 5, article 2 and that has at least thirty elected committeemen who are from precincts that are in the legislative district and that are in the county in which the vacancy occurred, the following apply:

The secretary of state shall immediately notify the state party chairman of the appropriate political party of the vacancy. Within three calendar days after notification of the vacancy by the secretary of state, the state party chairman of the appropriate political party or the chairman's designee shall give written notice of the meeting for selecting nominees to fill the vacancy to all elected precinct committeemen of the appropriate political party from precincts that are in the legislative district and that are in the county in which the vacancy occurred.
The meeting prescribed by paragraph 1 of this subsection shall occur within five calendar days after the date of the written notice of the meeting for selecting nominees if the legislature is in session, the governor has called a special session or if the presiding officer or minority leader of the house in which the vacancy has occurred notifies the chair of the board that a special session is pending or within twenty-one calendar days after the date of notice of the vacancy from the secretary of state if the legislature is not in session, the governor has not called a special session and the chair of the board has not been notified that a special session is pending.
At the meeting for selecting nominees to fill the vacancy, those elected precinct committeemen shall nominate by a majority vote three qualified electors to fill the vacancy who meet the requirements for service in the legislature, who belong to the same political party and who reside at the time of nomination in the same district and county as the person elected to or appointed to the office immediately before the vacancy.
The meeting to select nominees to fill the vacancy is subject to title 38, chapter 3, article 3.1, and the state party chairman of the appropriate political party shall oversee the nominations. Fifty percent or more of the elected precinct committeemen of the district who are in the legislative district and from the county in which the vacancy occurred, or their proxies, meeting together constitutes a quorum for the purposes of this subsection. A precinct committeeman may choose to allow the use of a proxy that:

(a) Is given by the precinct committeeman to another elected precinct committeeman for the legislative district in which the vacancy occurred for use at the meeting to fill the vacancy.

(b) Only is valid for the length of the meeting for which it was given.

The state party chairman of the appropriate political party shall immediately forward the names of the three persons named pursuant to paragraph 3 of this subsection to the board of supervisors of the county of residence of the person elected or appointed to the office immediately before the vacancy occurred. The board of supervisors shall appoint a person to fill the vacancy from the three nominees submitted. If the legislature is in session, the governor has called a special session or if the presiding officer or minority leader of the house in which the vacancy has occurred notifies the chair of the board that a special session is pending, the board of supervisors shall make the appointment within ten calendar days after receiving the names and if the legislature is not in session, the governor has not called a special session and the chair of the board has not been notified that a special session is pending, the board of supervisors shall make the appointment within twenty-one calendar days after receiving the names. If the board of supervisors fails to fill the vacancy from the three nominees within the time prescribed by this paragraph, the state party chairperson shall appoint from among the three nominees submitted to the county board of supervisors a person to fill the vacancy within three calendar days after the time for the board of supervisors to fill the vacancy has elapsed.
If the elected precinct committeemen of the appropriate political party fail to nominate by a majority vote three qualified electors to fill the vacancy at the meeting to select nominees as prescribed by paragraph 3 of this subsection, the state party chairman shall immediately notify the board of supervisors of the appropriate county and the board of supervisors shall fill the vacancy as provided in subsection B of this section. The time frame for appointing a citizens panel shall run from receipt of notification from the state party chairman.

B. If a vacancy occurs in the legislature and the vacant seat was represented by a political party that is organized pursuant to title 16, chapter 5, article 2 and that has fewer than thirty elected committeemen who are from precincts that are in the legislative district and that are in the county in which the vacancy occurred or if the vacant seat was not represented by a political party that is organized pursuant to title 16, chapter 5, article 2, the following apply:

The secretary of state shall immediately notify the board of supervisors of the county of residence of the person elected to or appointed to the office immediately before the vacancy of the vacancy.
Within seven calendar days after notification of the vacancy by the secretary of state, the board of supervisors shall appoint a citizens panel to submit to the board the names of three qualified electors to fill the vacancy who meet the requirements for service in the legislature and who belong to the same political party and reside at the time of nomination in the same district and county as the person elected to or appointed to the office immediately before the vacancy. If the person elected to or appointed to the office immediately before the vacancy was not registered with a political party that is organized pursuant to title 16, chapter 5, article 2, the qualified electors shall be qualified electors who are not registered with a political party that is organized pursuant to title 16, chapter 5, article 2.
The meeting of the citizens panel prescribed by paragraph 2 of this subsection shall occur within five calendar days after the citizens panel is appointed by the board of supervisors if the legislature is in session, the governor has called a special session or the chair of the board has been notified that a special session is pending, or within twenty-one calendar days after the citizens panel is appointed if the legislature is not in session, the governor has not called a special session and the chair of the board has not been notified that a special session is pending.
The board of supervisors, by a majority vote of the board, shall appoint one person from the list of names submitted by the citizens panel to fill the vacancy. If the legislature is in session, if the governor has called a special session or if the presiding officer or minority leader of the house in which the vacancy has occurred notifies the chair of the board that a special session is pending, the board of supervisors shall make the appointment within ten calendar days after receiving the names and if the legislature is not in session, the governor has not called a special session and the chair of the board has not been notified that a special session is pending, the board of supervisors shall make the appointment within twenty-one calendar days after receiving the names. If the board of supervisors fails to fill the vacancy from the three nominees within the time prescribed, the state party chairman shall appoint a person to fill the vacancy from the three nominees submitted and shall make that appointment within three calendar days after the time for the board of supervisors to fill the vacancy has elapsed.

C. If any person who is nominated pursuant to subsection A or B of this section withdraws from consideration, the state party chairman of the appropriate political party shall immediately nominate an alternative qualified elector to fill the vacancy who meets the requirements for service in the legislature, who belongs to the same political party and who resides at the time of nomination in the same district and county as the person elected to or appointed to the office immediately before the vacancy.

D. For the purposes of this section, "appropriate political party" means the same political party of which the person who was elected to or appointed to the office was a member immediately before the vacancy occurred except that if the person vacating the office changed political party affiliation after taking office, the person who is appointed to fill the vacancy shall be of the same political party that the vacating officeholder was when the vacating officeholder was elected or appointed to that office.

Article 8 Penal Provisions

§ 41-1221 Preventing meeting of or disturbing legislature; classification

A. A person who knowingly, by force or fraud, prevents the legislature, or either house of the legislature, or any member thereof, from meeting or organizing, is guilty of a class 5 felony.

B. A person who knowingly disturbs the legislature, or either house of the legislature, while in session, or who commits any disorderly conduct in the immediate view and presence of either house, tending to interrupt its proceedings or impair the respect due its authority, is guilty of a class 2 misdemeanor.

§ 41-1224 Altering or illegally removing enrolled copy of bill or resolution; classification; exception

A. A person is guilty of a class 4 felony who:

Fraudulently alters the enrolled copy of a bill or resolution which has been passed or adopted by the legislature with intent to procure its approval by the governor, or its certification by the secretary of state, or its printing or publication, in language different from that with which it was passed or adopted by the legislature.
Knowingly and without authority of law, changes, alters or causes to be changed or altered, a bill or resolution after the bill or resolution has been introduced in either house of the legislature.
Knowingly and without authority of law removes or causes to be removed, a bill or resolution from possession of the lawful custodian thereof, after the bill or resolution has been introduced in either house of the legislature.

B. The enrolling and engrossing clerk may make corrections in capitalization, spelling, form or punctuation necessary for proper style and composition of the bill which do not alter its meaning or intent.

§ 41-1225 Forfeiture of office of legislator

A member of the legislature who is convicted of any felony in this article or sections 41-1282 or 41-1283, shall, in addition to the punishment prescribed, forfeit his office and is forever disqualified from holding any office in this state.

Article 8.1 Registration and Regulation of Lobbyists

§ 41-1231 Definitions

In this article, unless the context otherwise requires:

"Authorized lobbyist" means any person, other than a designated lobbyist or lobbyist for compensation, who is employed by, retained by or representing a principal, with or without compensation, for the purpose of lobbying and who is listed as an authorized lobbyist by the principal in its registration pursuant to section 41-1232.
"Authorized public lobbyist" means a person, other than a designated public lobbyist, who is employed by, retained by or representing a public body, with or without compensation, for the purpose of lobbying and who is listed as an authorized public lobbyist by the public body in its registration pursuant to section 41-1232.01.
"Designated lobbyist" means the person who is designated by a principal as the single point of contact for the principal and who is listed as the designated lobbyist by the principal in its registration pursuant to section 41-1232.
"Designated public lobbyist" means the person who is designated by a public body as the single point of contact for the public body and who is listed as the designated public lobbyist by the public body in its registration pursuant to section 41-1232.01.
"Entertainment" means the amount of any expenditure paid or incurred for admission to any sporting or cultural event or for participation in any sporting or cultural activity.
"Expenditure" means a payment, distribution, loan, advance, deposit or gift of money or anything of value and includes a contract, promise or agreement, whether or not legally enforceable, to make an expenditure that provides a benefit to an individual state officer or state employee and that is incurred by or on behalf of one or more principals, public bodies, lobbyists, designated public lobbyists or authorized public lobbyists.
"Family gift" means a gift to a state officer or employee or a member of the officer's or employee's household from a principal, lobbyist, designated public lobbyist or authorized public lobbyist who is a relative of the state officer or employee or a member of the household of the state officer or employee if the donor is not acting as the agent or intermediary for someone other than a person covered by this paragraph.
"Food or beverage" means the amount of any expenditure paid or incurred for food or beverages for a state officer or employee provided at a location at which the principal, public body, lobbyist, designated public lobbyist or authorized public lobbyist who made the expenditure is present.
"Gift" means a payment, distribution, expenditure, advance, deposit or donation of money, any intangible personal property or any kind of tangible personal or real property. For the purposes of this article, gift does not include:

(a) A gift, devise or inheritance from an individual's spouse, child, parent, grandparent, grandchild, brother, sister, parent-in-law, brother-in-law, sister-in-law, nephew, niece, aunt, uncle or first cousin or the spouse of any such individual if the donor is not acting as the agent or intermediary for someone other than a person covered by this subdivision.

(b) Expenditures that are either properly reported or exempt from reporting under this chapter for:

(i) A speaking engagement.

(ii) Food or beverages.

(iii) Travel and lodging.

(iv) Flowers.

(d) The value, cost or price of professional or consulting services that are not rendered to obtain a benefit for any registered principal, public body, lobbyist, designated public lobbyist or authorized public lobbyist or the clients of a principal or lobbyist.

(e) Expenses relating to a special event or function to which all members of the legislature, either house of the legislature or any committee of the legislature is invited.

(f) A plaque or other form of recognition similar to a plaque to a state officer or state employee to signify the honorary recognition of a service or other notable accomplishment.

(g) Informational material such as books, reports, pamphlets, calendars or periodicals.

(h) An item that is not used and that is returned within fifteen days of receipt to the donor or that is delivered within fifteen days of receipt to a charitable organization and that is not claimed as a charitable contribution for state or federal income tax purposes.

(i) A campaign contribution that is properly received and reported as required by law.

(j) An item that is given to a state officer or employee if the state officer or employee gives an item of approximately the same value to the giver of the item at the same time that the item is given or on a similar occasion as the one that prompted the original item to be given.

(k) Gifts of a personal nature that were customarily received by an individual from the donor before the individual became a state officer or employee.

(l) An item that is given to the general public at an event.

"Legislation" means bills, resolutions, memorials, amendments, nominations and other matters that are pending or proposed in either house of the legislature of this state.
"Lobbying":

(a) Means attempting to influence the passage or defeat of any legislation by directly communicating with any legislator or attempting to influence any formal rulemaking proceeding pursuant to chapter 6 of this title or rulemaking proceedings that are exempt from chapter 6 of this title by directly communicating with any state officer or employee.

(b) Includes, for a person who is otherwise required to be registered as a lobbyist for compensation pursuant to this article, attempting to influence the procurement of materials, services or construction by an agency as defined in section 41-1001, including the office of the governor.

(i) Interagency communications between state agency employees.

(ii) Communications between a public official or employee of a public body, designated public lobbyist or authorized public lobbyist and any state officer, except for a member of the legislature, or an employee of the legislature.

(iii) Oral questions or comments made by a person to a state officer or employee regarding a proposed rule and made in public at a meeting or workshop that is open to the public and that is sponsored by a state agency, board, commission, council or office.

(iv) Communications between a public body and a self-employed person or person employed by a partnership or company regarding the procurement of materials, services or construction unless the self-employed person or person employed by a partnership or company is otherwise required to register pursuant to this article or is employed by, supervised by at any level or contracted by a person who is otherwise required to register as a lobbyist for compensation pursuant to this article.

"Lobbyist" means any person, other than a designated public lobbyist or authorized public lobbyist, who is employed by, retained by or representing a person other than himself, with or without compensation, for the purpose of lobbying and who is listed as a lobbyist by the principal in its registration pursuant to section 41-1232. Lobbyist includes a lobbyist for compensation, designated lobbyist and authorized lobbyist.
"Lobbyist for compensation" means a lobbyist who is compensated for the primary purpose of lobbying on behalf of a principal and who is listed by the principal in its registration pursuant to section 41-1232.
"Person" means an individual, partnership, committee, association or corporation and any other organization or group of persons, except legislators and political parties qualified for representation on the ballot pursuant to section 16-801 or 16-804.
"Personal hospitality" means hospitality, meals, beverages, transportation or lodging furnished but not commercially provided by a person on property or facilities owned or possessed by the person or the person's family.
"Principal" means any person, other than a public body, that employs, retains, engages or uses, with or without compensation, a lobbyist. Principal includes any subsidiary of a corporation.
"Procurement" has the same meaning prescribed in section 41-2503.
"Public body" means the Arizona board of regents, a university under the jurisdiction of the Arizona board of regents, the judicial department, any state agency, board, commission or council, any county, any county elected officer who elects to appoint a designated public lobbyist or any city, town, district or other political subdivision of this state that receives and uses tax revenues and that employs, retains, engages or uses, with or without compensation, a designated public lobbyist or authorized public lobbyist.
"Public official" means a person who is duly elected, appointed or retained through election to an elected state, county or local office.
"Single expenditure" means an expenditure that provides a benefit of more than twenty dollars to an individual state officer or state employee and that is incurred by or on behalf of one or more principals, public bodies, lobbyists, designated public lobbyists or authorized public lobbyists.
"Speaking engagement":

(a) Means the amount of any expense paid or incurred for entrance fees, lodging, food and beverage, entertainment, travel and other expenses for the state officer's or employee's attendance at an event, committee, meeting, conference or seminar, including meetings of state, regional or national organizations or their committees concerned with legislative or governmental activities if the state officer or employee participates in the event as a speaker or panel participant by presenting information relating to the state officer's or employee's legislative or official duties or by performing a ceremonial function appropriate to the state officer's or employee's position.

(b) Does not include expenditures for an honorarium or any other similar fee paid to a speaker.

"State employee" means an employee of the legislature, a university under the jurisdiction of the Arizona board of regents, the judicial department or a state office, agency, board, commission or council.
"State officer" means a person who is duly elected, appointed or retained through election to any state office, or a member of any state board, commission or council, and includes a member of the legislature.

§ 41-1232 Registration of principals; fee

A. Except as provided in subsection B of this section, before any principal causes any lobbying to occur on its behalf, the principal shall register with the secretary of state by filing a written statement in a format prescribed by the secretary of state, subscribed under penalty of perjury, containing the following information:

The name and business address of the principal.
The name and business address of a person who is the designated lobbyist for the principal, regardless of whether the person is engaged to lobby for compensation.
The name and business address of each lobbyist for compensation or authorized lobbyist employed by, retained by or representing the principal.
For each lobbyist for compensation, designated lobbyist or authorized lobbyist that is not an individual, the name and business address of all employees of that lobbyist who lobby on the principal's behalf.
The nature of the primary business or activity, issue, interest or purpose of the principal.
The duration of the engagement of any lobbyist.
A description of the expenses for which each lobbyist is to be reimbursed by the principal.
A listing of the state entities the lobbyist has been engaged or designated to lobby including the legislature and state agencies, boards, commissions or councils.

B. If a registration as required by subsection A of this section cannot be accomplished or is not practicable in advance of the first attempt or occasion to lobby, registration must occur within five business days after the day on which the first lobbying attempt, occasion or activity occurs.

C. Each principal shall reregister not later than 5:00 p.m. on the second Monday in January of each odd numbered year unless at that time the principal no longer engages any lobbyist. A principal shall file its registration at any time beginning December 1 in the even numbered year until 5:00 p.m. on the second Monday in January in the odd numbered year. Each principal shall amend its registration statement within five business days of any change in the information required by subsection A of this section.

D. A principal shall provide notice to each lobbyist for compensation, authorized lobbyist and designated lobbyist who is named in the principal's registration or reregistration statement. The notice shall state that the principal has listed the lobbyist for compensation, authorized lobbyist or designated lobbyist on the principal's registration or reregistration statement and that this listing obligates the lobbyist for compensation or designated lobbyist to register and file all reports required by this article. The notice shall be accompanied by a summary of the lobbyist laws published by the secretary of state, the first page of the principal's registration and the page of the schedule on which the name of the lobbyist for compensation, authorized lobbyist or designated lobbyist appears.

E. Each principal that registers a lobbyist for compensation or a designated lobbyist who receives compensation for lobbying from the principal, at the time of registering or reregistering, shall pay a registration or reregistration fee of $25 to the secretary of state. A principal may not be charged more than one $25 fee per registration period. Registration and reregistration fees collected by the secretary of state shall be deposited, pursuant to sections 35-146 and 35-147, in the state general fund, and, subject to legislative appropriation, the registration and reregistration fees for principals shall be used to reduce the costs associated with enforcing the lobbyist registration laws.

§ 41-1232.01 Registration by public bodies; fee

A. Except as provided in subsection B of this section, before any public body causes any lobbying to occur on its behalf, the public body shall register with the secretary of state by filing a written statement in a format prescribed by the secretary of state, subscribed under penalty of perjury, containing the following information:

The name and business address of the public body.
The name and business address of a person who is the designated public lobbyist for the public body, regardless of whether this person is engaged to lobby for compensation.
The name and business address of each authorized public lobbyist employed by, retained by or representing the public body.
For each designated public lobbyist or authorized public lobbyist that is not an individual, the name and business address of all employees of the designated public lobbyist or authorized public lobbyist who may lobby on the public body's behalf.
A description of the expenses for which each designated public lobbyist and authorized public lobbyist is to be reimbursed by the public body.

C. Each public body shall reregister not later than 5:00 p.m. on the second Monday in January of each odd numbered year unless at that time the public body no longer engages any designated public lobbyist or authorized public lobbyist. A public body shall file its registration at any time beginning December 1 in the even numbered year until 5:00 p.m. on the second Monday in January in the odd numbered year. Each public body shall amend its registration statement within five business days of any change in the information required by subsection A of this section.

D. A public body shall provide notice to each designated public lobbyist or authorized public lobbyist who is named in the public body's registration or reregistration statement. The notice shall state that the public body has listed the designated public lobbyist or authorized public lobbyist on the public body's registration or reregistration statement and that this listing obligates the designated public lobbyist to register and file all reports required by this article. The notice shall be accompanied by a summary of the lobbyist laws published by the secretary of state, the first page of the public body's registration and the page of the schedule on which the designated or authorized public lobbyist's name appears.

E. Each public body that registers a designated public lobbyist who receives compensation for lobbying from the public body, at the time of registering or reregistering, shall pay a registration or reregistration fee of $25 to the secretary of state. A public body may not be charged more than one $25 fee per registration period. Registration and reregistration fees collected by the secretary of state shall be deposited, pursuant to sections 35-146 and 35-147, in the state general fund, and, subject to legislative appropriation, the registration and reregistration fees for public bodies shall be used to reduce the costs associated with enforcing the lobbyist registration laws.

§ 41-1232.02 Expenditure reporting; principals and lobbyists; gifts

A. Each principal shall report annually all single expenditures, whether or not the expenditures were made in the course of lobbying. These single expenditures shall be itemized separately, and each itemization shall include the date of the expenditure, the amount of the expenditure, the name of each state officer or employee receiving or benefitting from the expenditure, the category of the expenditure and the name of the lobbyist or other person who made the expenditure on behalf of the principal. In addition each principal shall report annually the aggregate of all expenditures of $20 or less received by or benefitting a state officer or employee, whether or not the expenditures were made in the course of lobbying. The report shall be filed by March 1 and shall list the annual expenditures made on behalf of the principal. If March 1 is a Saturday, Sunday or other legal holiday, the report shall be filed on the next business day.

B. Each lobbyist for compensation and designated lobbyist shall report quarterly all single expenditures incurred in the preceding calendar quarter by the lobbyist for compensation or designated lobbyist, whether or not the single expenditures were made in the course of lobbying. These single expenditures shall be itemized separately, and each itemization shall include the date of the expenditure, the amount of the expenditure, the name of the state officer or employee receiving or benefitting from the expenditure, the category of the expenditure and the principal on whose behalf the expenditure was made. If the expenditure was made by the lobbyist and was not made on behalf of a principal, it shall be itemized separately. The quarterly report shall be filed not later than the last day of the month following the end of the calendar quarter, unless the last day of the month is a Saturday, Sunday or other legal holiday. In that case, the report shall be filed on the next business day.

C. Each lobbyist for compensation and designated lobbyist shall also report quarterly the aggregate of all expenditures of $20 or less received by or benefitting a state officer or employee, whether or not the expenditures were made in the course of lobbying. The report shall list separately the aggregate of expenditures made on behalf of each principal and the aggregate not made on behalf of any principal. In the fourth calendar quarter, these expenditures shall also be listed by cumulative total for the calendar year. Each quarterly lobbyist report shall include all reportable expenditures made by any employee of the lobbyist for compensation or designated lobbyist, regardless of whether that employee is listed as a lobbyist on any registration filed by a principal engaging the lobbyist. The quarterly report shall be filed not later than the last day of the month following the end of the calendar quarter, unless the last day of the month is a Saturday, Sunday or other legal holiday. In that case, the report shall be filed the next business day.

D. The reports required by subsections A and B of this section shall identify each single expenditure according to the following categories:

Food or beverages.
Speaking engagement.
Travel and lodging.
Flowers.
Other expenditures.

E. Expenditures by principals and lobbyists such as those for the lobbyist's personal sustenance, office expenses, filing fees, legal fees, employees' compensation, lodging and travel are not required to be reported. In addition, expenditures by a principal or a lobbyist for family gifts, personal hospitality or those items excluded from the definition of gift pursuant to section 41-1231, paragraph 9, subdivision (a), (c), (d), (f), (g), (h), (i), (j), (k) or (l) are not required to be reported.

F. All expenditures incurred by a principal or lobbyist for special events for legislators, including parties, dinners, athletic events, entertainment and other functions, to which all members of the legislature, either house of the legislature or any committee of the legislature are invited shall be reported. Expenditures are not required to be allocated to individual legislators, but for each such event a description of the event and the date, location, name of the legislative body invited and total expenditures incurred shall be reported. Expenditures for special events held in conjunction with state, national or regional meetings of an organization or association concerned or dealing with legislative or other governmental activities to which all state officers or state employees in attendance at such event are invited shall be reported in the same manner.

G. All information required to be filed pursuant to this section with the secretary of state shall be filed in that office and preserved by the secretary of state for five years from the date of filing, after which time the information shall be destroyed. The information is a public record and open to public inspection.

H. If a principal, lobbyist for compensation or designated lobbyist makes no expenditures that it would otherwise be required to report during a specified reporting period, the principal, lobbyist for compensation or designated lobbyist may sign a form under penalty of perjury prescribed by the secretary of state indicating that there were no expenditures during the specific reporting period.

I. A person or organization shall not make a gift to or an expenditure on behalf of a state officer or employee through another person or organization for the purpose of disguising the identity of the person making the gift or expenditure.

J. A principal or lobbyist or any other person acting on behalf of a principal or lobbyist shall not give to any state officer or state employee and a state officer or state employee shall not accept from a principal or lobbyist either of the following:

Gifts with a total value of more than $10 during any calendar year.
Gifts that are designed to influence the state officer's or state employee's official conduct.

§ 41-1232.03 Expenditure reporting; public bodies and public lobbyists; gifts

A. Each public body shall report annually all single expenditures received by or benefitting a member of the legislature whether or not the expenditures were made in the course of lobbying. These expenditures shall be itemized separately, and each itemization shall include the date of the expenditure, the amount of the expenditure, the name of each member of the legislature receiving or benefitting from the expenditure, the category of the expenditure and the name of the designated public lobbyist or authorized public lobbyist who made the expenditure on behalf of the public body. In addition each public body shall report annually the aggregate of all expenditures of $20 or less received by or benefitting a member of the legislature, whether or not the expenditures were made in the course of lobbying. The report shall list all expenditures by the public body made in the course of lobbying for the personal sustenance, filing fee, legal fees, employees' compensation, meals, lodging and travel of the designated public lobbyist and all authorized public lobbyists employed or retained by, and representing, the public body. The public body shall apportion expenditures that are attributable both to lobbying and to other activities of the public body and shall report only the portion attributable to lobbying. For the purpose of reporting employee compensation, a public body, on establishing a time allocation schedule for apportioned lobbying activity based on actual experience under this article, may submit after the 1993 calendar year an affidavit to the secretary of state stating the compensation attributable to lobbying for subsequent years for the designated public lobbyist and all authorized public lobbyists whose job responsibilities have not been significantly altered since the time allocation schedule was established. The report shall be filed by March 1 and shall list the annual expenditures made on behalf of the public body. If March 1 is a Saturday, Sunday or other legal holiday, the report shall be filed on the next business day.

B. Each designated public lobbyist shall report quarterly all single expenditures received by or benefitting a member of the legislature and incurred in the preceding calendar quarter by the designated public lobbyist, whether or not the single expenditures were made in the course of lobbying. Each designated public lobbyist's report shall also include all single expenditures incurred in the preceding calendar quarter by each authorized public lobbyist who is registered pursuant to section 41-1232.01 by the same public body that registered the designated public lobbyist. This subsection does not apply to an expenditure that was made by a designated public lobbyist or authorized public lobbyist and that was received by or benefitted an employee of a public body, if the employee is not a member or employee of the legislature or a member of the household of a member or employee of the legislature. These expenditures shall be itemized separately, and each itemization shall include the date of the expenditure, the amount of the expenditure, the name of the member or employee receiving or benefitting from the expenditure, the category of the expenditure and the public body on whose behalf the expenditure was made. If the expenditure was made by the designated public lobbyist or authorized public lobbyist and was not made on behalf of a public body, it shall be itemized separately. The quarterly report shall be filed not later than the last day of the month following the end of the calendar quarter, unless the last day of the month is a Saturday, Sunday or other legal holiday. In that case, the report shall be filed on the next business day.

C. Each designated public lobbyist shall also report quarterly the aggregate of all expenditures of $20 or less received by or benefitting a member of the legislature, whether or not the expenditures were made in the course of lobbying. Each designated public lobbyist's report shall also include the aggregate of all expenditures of $20 or less that were received by or benefitted a member of the legislature and that were made by an authorized public lobbyist who is registered pursuant to section 41-1232.01 by the same public body that registered the designated public lobbyist. This subsection does not apply to an expenditure that was made by a designated public lobbyist or authorized public lobbyist and that was received by or benefitted an employee of a public body, if the employee is not a member or employee of the legislature or a member of the household of a member or employee of the legislature. The report shall list separately the aggregate of expenditures made on behalf of each public body and the aggregate not made on behalf of any public body. In the fourth calendar quarter, these expenditures shall also be listed by cumulative total for the calendar year. Each quarterly lobbyist report shall include all reportable expenditures made by any employee of the designated public lobbyist or authorized public lobbyist, regardless of whether that employee is listed as a designated public lobbyist or authorized public lobbyist on any registration filed by a public body engaging the designated public lobbyist or authorized public lobbyist. The quarterly report shall be filed not later than the last day of the month following the end of the calendar quarter, unless the last day of the month is a Saturday, Sunday or other legal holiday. In that case, the report shall be filed on the next business day.

D. The reports required by subsections A and B of this section shall identify the nature of each single expenditure according to the following categories:

Food or beverages.
Speaking engagement.
Travel and lodging.
Flowers.
Other expenditures.

E. Expenditures by a public body, designated public lobbyist or authorized public lobbyist for personal sustenance, family gifts, personal hospitality or those items excluded from the definition of gift pursuant to section 41-1231, paragraph 9, subdivision (a), (c), (d), (f), (g), (h), (i), (j), (k) or (l) are not required to be reported.

F. All expenditures incurred by a public body, designated public lobbyist or authorized public lobbyist in the case of special events for legislators, including parties, dinners, athletic events, entertainment and other functions, to which all members of the legislature, either house of the legislature or any committee of the legislature are invited shall be reported. Expenditures are not required to be allocated to individual legislators, but for each such event a description of the event and the date, location, name of the legislative body invited and total expenditures incurred shall be reported. Expenditures for special events held in conjunction with state, national or regional meetings of an organization or association concerned or dealing with legislative or other governmental activities to which all members or employees of the legislature in attendance at such event are invited shall be reported in the same manner.

H. If a public body or designated public lobbyist makes no expenditures that it would otherwise be required to report during a specified reporting period, the public body or designated public lobbyist may sign a form under penalty of perjury prescribed by the secretary of state indicating that there were no expenditures during the specific reporting period.

I. A person or organization shall not make a gift to or an expenditure on behalf of a member or employee of the legislature through another person or organization for the purpose of disguising the identity of the person making the gift or expenditure.

J. A public body, designated public lobbyist or authorized public lobbyist or any other person acting on behalf of a public body, designated public lobbyist or authorized public lobbyist shall not give to any member of the legislature and a member of the legislature shall not accept from a public body, designated public lobbyist or authorized public lobbyist either of the following:

Gifts with a total value of more than $10 during any calendar year.
Gifts that are designed to influence the member's or employee's official conduct.

K. Subsection J of this section does not apply to gifts given by a public body, designated public lobbyist or authorized public lobbyist to an employee of a public body, if the employee is not a public official or a member of the household of a public official or if the gift is accepted on behalf of the public body and remains the property of the public body.

§ 41-1232.04 Registration; exceptions

Sections 41-1232, 41-1232.01, 41-1232.02 and 41-1232.03 do not apply to a person if that person is acting in the following capacity:

A natural person who merely appears for himself before a committee of the legislature or before a state officer or employee or a state agency, board, commission or council to lobby in support of or in opposition to legislation or official action.
A natural person who, acting in his own behalf, sends a letter to, converses on the telephone with or has a personal conversation with a state officer or employee for the purpose of supporting or opposing any legislation or official action.
A duly elected or retained public official, judge or justice, a person duly appointed to an elective public office, or an appointed member of a state, county or local board, advisory committee, commission or council acting in his official capacity on matters pertaining to his office, board, advisory committee, commission or council.
A person who answers technical questions or provides technical information at the request of a lobbyist, designated public lobbyist, authorized public lobbyist or legislator and who makes no expenditures required to be reported by this article.
A person who performs professional services in drafting bills or in advising and rendering opinions to clients as to the construction and effect of proposed or pending legislation.
An attorney who represents clients before any court or before any quasi-judicial body.
A person who contacts a state officer or state employee solely for the purpose of acquiring information.
A natural person who is a member of an association, who is not the lobbyist for compensation, designated lobbyist or authorized lobbyist for the association and who does not make any expenditures that would otherwise be required to be reported by this article if the natural person were a lobbyist, a designated public lobbyist or an authorized public lobbyist.

§ 41-1232.05 Lobbyist registration; handbook; requirement

A. A person who is listed by a principal or public body on a registration form pursuant to section 41-1232 or 41-1232.01 as a lobbyist for compensation, designated lobbyist or designated public lobbyist shall file a lobbyist registration form with the secretary of state in a format prescribed by the secretary of state no later than 5:00 p.m. on the second Monday in January of each even numbered year and shall read a handbook containing statutes and rules governing lobbyists for compensation, designated lobbyists and designated public lobbyists, written guidelines and forms and samples for completing the lobbyist disclosure forms. A person shall file the registration at any time beginning December 1 in the odd numbered year until 5:00 p.m. on the second Monday in January in the even numbered year. The lobbyist handbook shall be written and prescribed by the secretary of state. A person who is originally listed as a lobbyist for compensation, designated lobbyist or designated public lobbyist for a month other than January shall file, within thirty days, a registration form and shall file a registration form for January of each even numbered year thereafter if the person continues to be listed as a lobbyist for compensation, designated lobbyist or designated public lobbyist.

B. The lobbyist registration form shall include:

The name of the lobbyist for compensation, designated lobbyist or designated public lobbyist.
The business name and address of the lobbyist for compensation, designated lobbyist or designated public lobbyist.
A statement that the lobbyist for compensation, designated lobbyist or designated public lobbyist has read the lobbyist handbook prescribed in subsection A of this section.

§ 41-1232.06 Exemption; unpaid volunteers

This article does not apply to expenditures made for or gifts given to members of any state agency, board, commission, committee or council who are not publicly elected and who serve without compensation provided that the expenditure or gift is not made in the course of lobbying that member. If the expenditure or gift is made in the course of lobbying, the reporting requirements of sections 41-1232 and 41-1232.01 shall apply. Payments made to a member of any state agency, board, commission, committee or council pursuant to title 38, chapter 4, article 2 shall not be considered compensation for the purposes of this section.

§ 41-1232.07 Electronic filings

A. Any report or registration form that is required to be filed pursuant to this article may be filed in an electronic format that is approved by the secretary of state. The secretary of state may require that reports or registration forms be filed with an additional written or printed copy.

B. A report or registration form that is filed in electronic format pursuant to this section is not required to bear a notarized signature but is deemed to be filed under penalty of perjury.

C. An electronic filing made pursuant to this section is sufficient to comply with the filing requirements of this article if the filing is properly formatted as prescribed by this article and the information contained in the filing is complete and correct.

§ 41-1232.08 Entertainment ban; state and political subdivisions; exceptions

A. A principal, designated lobbyist, authorized lobbyist, lobbyist for compensation, public body, designated public lobbyist or authorized public lobbyist or any other person acting on that person's behalf shall not make an expenditure or single expenditure for entertainment for a state officer or state employee. A state officer or state employee shall not accept an expenditure or single expenditure for entertainment from a principal, designated lobbyist, authorized lobbyist, lobbyist for compensation, public body, designated public lobbyist or authorized public lobbyist or any other person acting on that person's behalf.

B. A person who for compensation attempts to influence the procurement of materials, services or construction by an agency as defined in section 41-1001, including the office of the governor, or the passage or defeat of legislation, ordinances, rules, regulations, nominations and other matters that are pending or proposed or that are subject to formal approval by the corporation commission, a county board of supervisors, a city or town governing body or a school district governing board or any person acting on that person's behalf shall not make an expenditure or single expenditure for entertainment for an elected or appointed member of the corporation commission, a county board of supervisors, a city or town governing body or a school district governing board. An elected or appointed member of the corporation commission, a county board of supervisors, a city or town governing body or a school district governing board shall not accept an expenditure or single expenditure for entertainment from a person who for compensation attempts to influence the procurement of materials, services or construction by an agency as defined in section 41-1001, including the office of the governor, or the passage or defeat of legislation, ordinances, rules, regulations, nominations and other matters that are pending or proposed or that are subject to formal approval by the corporation commission, a county board of supervisors, a city or town governing body or a school district governing board.

C. This section shall not apply to:

Entertainment in connection with a special event properly reported pursuant to this article.
Entertainment that is incidental to a speaking engagement.
The following persons while attending or participating in any sporting or cultural event or activity, sponsored by the board, district or institution, in a facility that is owned or operated by the board, district or institution:

(a) Employees of a school district governing board.

(b) Employees of a community college district governing board.

D. The provisions of this article that define special events for legislators apply to special events for members of the Arizona board of regents.

§ 41-1233 Prohibited acts

No person shall:

Retain or employ another person to promote or oppose legislation for compensation contingent in whole or in part on the passage or defeat of any legislation, or the approval or veto of any legislation by the governor, and no person shall accept employment or render service for compensation on a contingent basis.
Lobby the legislature for compensation within one year after the person ceases to be a member of the senate or house of representatives.
In any manner improperly seek to influence the vote of any member of the legislature through communication with that member's employer.
Lobby the public body that employed the person in a capacity having a significant procurement role as defined in section 41-741 in the procurement of materials, services or construction within one year after the person ceases to be employed by the public body.

§ 41-1233.01 Disclosure

A person who is registered pursuant to this article or who is a designated lobbyist, lobbyist for compensation, authorized lobbyist, designated public lobbyist or authorized public lobbyist shall disclose that fact to:

Any legislator the person is lobbying for the first time or on any subsequent request of a legislator.
Any public official or employee of a public body each time that the person is lobbying for the procurement of materials, services or construction. The person also shall disclose the name of that person's client.

§ 41-1234 Publicly funded contract lobbyists; prohibition; definition

A. Notwithstanding any other law, a state agency, office, department, board or commission and any person acting on behalf of a state agency, office, department, board or commission shall not:

Enter into a contract or other agreement with a person or entity for lobbying services.
Spend monies for any person or entity to lobby on behalf of that agency, office, department, board or commission unless that person is a state employee.

B. This section does not apply to any state agency, office, department, board or commission that is either:

Headed by one or more elected officials.
Exempt from title 41, chapter 23 for the purposes of contracts for professional lobbyists.

C. This section does not apply to the employment relationship of a lobbyist who is a state employee directly employed by a state governmental unit for whom the employee acts as a lobbyist or lobbying is part of the employee's job description.

D. For the purposes of this section, "state employee" has the same meaning prescribed in section 41-1231.

§ 41-1234.01 Contributions prohibited during session; exceptions

A. While registered under this article, a principal, public body, lobbyist, designated public lobbyist or authorized public lobbyist shall not make or promise to make a campaign contribution to or solicit or promise to solicit campaign contributions for:

A member of the legislature when the legislature is in regular session.
The governor when the legislature is in regular session or when regular session legislation is pending executive approval or veto.

B. Subsection A of this section only prohibits campaign contributions by principals, lobbyists, designated public lobbyists or authorized public lobbyists and the solicitation of campaign contributions by principals or lobbyists during any time that the legislature is in regular session but does not prohibit principals or lobbyists from raising monies for any other purpose during the regular session of the legislature.

C. A member of the legislature or the governor may accept a campaign contribution that is received by a member of the legislature or the governor within three calendar days after the first day of the regular session of the legislature if the campaign contribution was mailed and postmarked before the first day of the regular legislative session.

§ 41-1235 Spurious communications; classification

Whoever shall transmit, utter or publish to the legislature, or to any member or members of the legislature, or any committee, officer or employee of either house of the legislature, or to any state officer, agency, board, commission or council any communication materially related to any matter within the jurisdiction of the legislature, or be a party to the preparation thereof, knowing such communication or signature thereto is false, forged, counterfeit or fictitious shall be guilty of a class 2 misdemeanor.

§ 41-1236 Reports and statements under penalty of perjury

All reports and statements required under this article shall be made under penalty of perjury.

§ 41-1237 Violation; classification

A. Any person who knowingly violates any of the provisions of this article and any person who knowingly files any document provided for in this article that contains any materially false statement or material omission or any person who knowingly fails to comply with any material requirement of this article is guilty of a class 1 misdemeanor unless another classification is specifically prescribed in this article.

B. Any alleged violation of any provisions of this article may be investigated and prosecuted by the attorney general or by the county attorney of the county in which the alleged offense was committed.

§ 41-1237.01 Compliance orders; injunctive relief; civil penalties

A. If the secretary of state has reasonable cause to believe that a person is violating any provision of this article, the secretary of state shall notify the attorney general and the attorney general may serve on the person an order requiring compliance with that provision. The order shall state with reasonable particularity the nature of the violation and shall require compliance within twenty days from the date of issuance of the order. The alleged violator has twenty days from the date of issuance of the order to request a hearing pursuant to chapter 6, article 10 of this title.

B. If a person does not request a hearing and fails to take corrective action within the time specified in the compliance order issued pursuant to subsection A of this section or if, after the hearing, the person fails to take corrective action in compliance with an order issued after the hearing within the time specified in the order, the attorney general shall issue an order assessing a civil penalty of not more than one thousand dollars. The person alleged to have violated the compliance order has thirty days from the date of issuance of the order assessing the civil penalty to request a hearing pursuant to chapter 6, article 10 of this title.

C. Except as provided in section 41-1092.08, subsection H, any party aggrieved by a final order or decision of the attorney general may appeal to the superior court pursuant to title 12, chapter 7, article 6.

§ 41-1238 Limitations

No provision of this article shall be construed, interpreted or enforced so as to limit, impair, abridge or destroy any person's right of freedom of expression and participation in government processes, or freedom of the press.

§ 41-1239 Duties of secretary of state

A. The secretary of state shall:

Prescribe and publish the registration and registration amendment forms and the annual and quarterly expenditure forms, handbooks and rules necessary to carry out the provisions of this article.
Refer to the attorney general or county attorney for investigation any matter which the secretary of state has reason to believe constitutes a violation of any of the provisions of this article.
Provide for the cross-referencing of the registration required by sections 41-1232 and 41-1232.01 so that each lobbyist authorized by a principal pursuant to section 41-1232, subsection A and each public lobbyist authorized by a public body pursuant to section 41-1232.01, subsection A shall be identified with such principal.
Advise incumbents and nonincumbent candidates regarding campaign finance laws and public officer reporting and disclosure laws. At the request of the person asking for advice, the secretary of state shall log the request and the response.
Compile and issue an annual report of all expenditures reported by principals, public bodies, lobbyists and public lobbyists. The annual report shall accurately summarize all expenditures for lobbying but shall not double report expenditures by a lobbyist that were reimbursed and reported by a principal or public body. The report shall list the name of each principal or public body along with the name of each lobbyist or public lobbyist that is listed on the principal's registration statement.

B. The secretary of state may adopt rules regarding initiative, referendum and recall. Rules adopted pursuant to this subsection apply to statewide and county initiatives, referenda and recalls.

Article 9 Joint Committee on Capital Review

§ 41-1251 Joint committee on capital review; members; chairperson; meetings

A. The joint committee on capital review is established consisting of fourteen members, including the chairpersons of the senate and house of representatives appropriations committees, the majority and minority leaders of the senate and the house of representatives, four members of the senate appropriations committee appointed by the president of the senate and four members of the house of representatives appropriations committee appointed by the speaker of the house of representatives.

B. The chairperson of the senate appropriations committee has a term as chairperson of the joint committee on capital review from the first day of the first regular session to the first day of the second regular session of each legislature, and the chairperson of the house of representatives appropriations committee has a term from the first day of the second regular session to the first day of the next legislature's first regular session.

C. The joint committee on capital review shall meet as often as the members deem necessary, and a majority of the members constitutes a quorum for the transaction of business.

§ 41-1252 Powers and duties; staffing

A. The joint committee on capital review shall:

Develop and approve a uniform formula for computing annual building renewal funding needs and a uniform format for the collection of data for the formula pursuant to section 41-793.01.
Approve building systems for the purposes of computing and funding building renewal pursuant to section 41-793.01 and for preparing capital improvement plans pursuant to section 41-793.
Review the state capital improvement plan prepared pursuant to section 41-793 and make recommendations to the legislature concerning funding for land acquisition, capital projects and building renewal.
Review the expenditure of all monies appropriated for land acquisition, capital projects and building renewal.

B. In making its recommendations to the legislature, the joint committee on capital review should give priority to funding fire and life safety projects.

C. Before the release of monies for construction of a new capital project that has an estimated total cost of more than two hundred fifty thousand dollars, the joint committee on capital review shall review the scope, purpose and estimated cost of the project. A construction contract shall not divide a new capital project into projects with an estimated cost of two hundred fifty thousand dollars or less for the purpose of evading committee review. The joint committee on capital review may review any capital project regardless of its cost.

D. The joint committee on capital review has the powers conferred by law on legislative committees.

E. In performing its duties, the joint committee on capital review shall be staffed by the joint legislative budget committee staff.

§ 41-1253 Public and private gifts and grants

The joint committee on capital review may accept and expend in the name of the legislature public and private gifts and grants.

Article 10 Joint Legislative Budget Committee

§ 41-1271 Joint legislative budget committee; members; chairman; meetings

A. There is established a joint legislative budget committee which consists of sixteen members, including the majority leaders of the senate and house of representatives, the chairmen of the senate and house of representatives appropriations committees, the chairman of the senate finance committee and the chairman of the house ways and means committee, five members of the senate and five members of the house of representatives who are members of their respective appropriations committees. The president of the senate and the speaker of the house of representatives shall each appoint the five members from their appropriations committee to the joint legislative budget committee.

B. The chairman of the house of representatives appropriations committee has a term as chairman of the joint legislative budget committee from the first day of the first regular session to the first day of the second regular session of each legislature, and the chairman of the senate appropriations committee has a term from the first day of the second regular session to the first day of the next legislature's first regular session.

C. The joint legislative budget committee shall meet as often as they deem necessary, and a majority of the members shall constitute a quorum for the transaction of business.

§ 41-1272 Powers and duties; finances

A. The joint legislative budget committee shall:

Ascertain facts and make recommendations to the legislature relating to the state budget, revenues and expenditures of the state, future fiscal needs, the organization and functions of state agencies or their divisions and such other matters incident to the above functions as may be provided for by rules of the joint legislative budget committee.
Implement a system of fiscal notes to apply to those bills introduced in the legislature that have a fiscal impact. These fiscal notes shall also reflect the fiscal impact of legislation on cities, counties and all other political subdivisions of the state.
Implement a system of fiscal notes for any rule as defined by section 41-1001 which has a fiscal impact.
Analyze the state tax structure, tax burdens on individuals and businesses and tax incentives for existing and prospective businesses. The analyses shall include:

(a) Projection of the impact of industry specific tax incentive proposals on the state revenue base.

(b) Comparison among states of relative tax burdens on existing and prospective businesses.

Implement a system of fiscal analysis that applies to those bills introduced in the legislature that involve one or more proposed changes in the tax laws. Unless it is unreasonable to do so, the fiscal analysis shall be based on assumptions that estimate the probable behavioral response of taxpayers, businesses and other citizens and shall include within the analysis a statement identifying those assumptions.
Adopt rules.

B. The joint legislative budget committee may:

Make studies, conduct inquiries and investigations and hold hearings.
Meet and conduct its business any place within the state during the sessions of the legislature or any recess of the legislature and in the period when the legislature is not in session.
Establish subcommittees from the membership of the legislature and assign to such subcommittee any study, inquiry, investigation or hearing with the right to call witnesses which the joint legislative budget committee has authority to undertake.

C. The joint legislative budget committee may obtain operational and maintenance assistance for any facility under the control of the committee without charge from the department of administration, may obtain security assistance from the department of public safety, may employ personnel to discharge operational, maintenance and security functions or may contract for outside services payable from joint legislative budget committee appropriations.

D. The joint legislative budget committee shall have the powers conferred by law upon legislative committees.

E. Members of the joint legislative budget committee shall be reimbursed by their respective houses in the same manner as is provided by law for a member of the legislature who attends a duly called meeting of a standing committee.

§ 41-1273 Budget analyst; employees; duties; reports

A. The joint legislative budget committee shall appoint a budget analyst and other clerical and technical employees that may be required.

B. The budget analyst shall serve full time as staff director and receive compensation as determined pursuant to section 38-611. The budget analyst, as a prerequisite for appointment, shall have demonstrated the budget analyst's competency and ability in the field of finance either in private business or public work.

C. The budget analyst may be removed from office prior to expiration of the budget analyst's term if, voting separately, a majority of the members of each body constituting the joint legislative budget committee votes in favor of removal.

D. The budget analyst shall prepare for distribution an analysis of the governor's budget as soon after the budget is presented to the legislature as is possible. The analysis, among other things, shall include recommendations of the budget analyst for revisions in expenditures.

E. In consultation with the governor's office of strategic planning and budgeting, the budget analyst shall determine and report to the governor and the legislature an estimate of appropriations subject to the limit imposed by article IX, section 17, Constitution of Arizona. The report shall be published on or before February 15 of each year for the preceding fiscal year, for the current fiscal year and for the ensuing fiscal year to reflect the budget recommendations of the joint legislative budget committee.

F. On or before December 1 of each year, the budget analyst shall report to the committee a listing of statutorily deleted and newly created funds and funds that changed appropriated status from the prior fiscal year.

G. On or before January 31 of each year, the budget analyst shall report to the committee the expenditures for each retirement system for the preceding fiscal year, including the expenditures made by this state for the employer contribution for each retirement system.

H. The legislature in making its appropriation for the operation of the legislature shall allocate a portion thereof for the operation of the joint legislative budget committee.

I. On or before December 1, 2019 and once every seven years thereafter, the budget analyst shall report to the committee the following:

The current amount of each surcharge and assessment that is authorized by law to be collected on every fine, penalty and forfeiture imposed and collected by the courts for criminal offenses and every civil penalty imposed and collected for a civil traffic violation and fine, penalty or forfeiture for a violation of the motor vehicle statutes, for any local ordinance relating to the stopping, standing or operation of a vehicle or for a violation of the game and fish statutes in title 17.
The items for which the collected surcharge or assessment monies are used.

§ 41-1274 Authority to accept and expend in the name of the legislature public and private gifts and grants

The joint legislative budget committee may accept and expend in the name of the legislature public and private gifts and grants.

§ 41-1276 Truth in taxation levy for equalization assistance to school districts

(Caution: 1998 Prop. 105 applies)

A. On or before February 15 of each year, the joint legislative budget committee shall compute and transmit the truth in taxation rates for equalization assistance for school districts for the following fiscal year to:

The chairpersons of the house of representatives ways and means committee and the senate finance committee, or their successor committees.
The chairpersons of the appropriations committees of the senate and the house of representatives, or their successor committees.

B. The truth in taxation rates consist of the qualifying tax rate for a high school district or a common school district within a high school district that does not offer instruction in high school subjects pursuant to section 15-971, subsection B, paragraph 1 and a qualifying tax rate for a unified district, a common school district not within a high school district or a common school district within a high school district that offers instruction in high school subjects pursuant to section 15-971, subsection B, paragraph 2 that will offset the change in net assessed valuation of property that was subject to tax in the prior year.

C. The joint legislative budget committee shall compute the truth in taxation rates as follows:

Determine the statewide net assessed value for the preceding tax year as provided in section 42-17151, subsection A, paragraph 3.
Determine the statewide net assessed value for the current tax year, excluding the net assessed value of property that was not subject to tax in the preceding year.
Divide the amount determined in paragraph 1 of this subsection by the amount determined in paragraph 2 of this subsection.
Adjust the qualifying tax rates for the current fiscal year by the percentage determined in paragraph 3 of this subsection in order to offset the change in net assessed value.

D. Except as provided in subsections E and G of this section, the qualifying tax rate for a high school district or a common school district within a high school district that does not offer instruction in high school subjects and the qualifying tax rate for a unified school district, a common school district not within a high school district or a common school district within a high school district that offers instruction in high school subjects for the following fiscal year shall be the rate determined by the joint legislative budget committee pursuant to subsection C of this section. The committee shall transmit the rates to the superintendent of public instruction and the county boards of supervisors by March 15 of each year.

E. If the legislature proposes qualifying tax rates that exceed the truth in taxation rate:

The house of representatives ways and means committee and the senate finance committee, or their successor committees, shall hold a joint hearing on or before February 28 and publish a notice of a truth in taxation hearing subject to the following requirements:

(a) The notice shall be published twice in a newspaper of general circulation in this state that is published at the state capital. The first publication shall be at least fourteen but not more than twenty days before the date of the hearing. The second publication shall be at least seven but not more than ten days before the date of the hearing.

(b) The notice shall be published in a location other than the classified or legal advertising section of the newspaper.

(c) The notice shall be at least one-fourth page in size and shall be surrounded by a solid black border at least one-eighth inch in width.

(d) The notice shall be in the following form, with the "truth in taxation hearing — notice of tax increase" headline in at least eighteen-point type:

Truth in Taxation Hearing

Notice of Tax Increase

In compliance with section 41-1276, Arizona Revised Statutes, the state legislature is notifying property taxpayers in Arizona of the legislature's intention to raise the property tax levy over last year's level.

The proposed tax increase will cause the taxes on a $100,000 home to be $(total proposed taxes including the tax increase). Without the proposed tax increase, the total taxes that would be owed on a $100,000 home would have been $_______.

All interested citizens are invited to attend a public hearing on the tax increase that is scheduled to be held (date and time) at (location).

(e) For the purposes of computing the tax increase on a $100,000 home as required by the notice, the joint meeting of the house of representatives ways and means committee and the senate finance committee, or their successor committees, shall consider the difference between the truth in taxation rate and the proposed increased rate.

The joint meeting of the house of representatives ways and means committee and the senate finance committee, or their successor committees, shall consider any motion to recommend the proposed tax rates to the full legislature by roll call vote.

F. In addition to publishing the truth in taxation notice under subsection E, paragraph 1 of this section, the joint meeting of the house of representatives ways and means committee and the senate finance committee, or their successor committees, shall issue a press release containing the truth in taxation notice.

G. Notwithstanding any other law, the legislature shall not adopt a state budget that provides for qualifying tax rates pursuant to section 15-971 that exceed the truth in taxation rates computed pursuant to subsection A of this section unless the rates are adopted by a concurrent resolution approved by an affirmative roll call vote of two-thirds of the members of each house of the legislature before the legislature enacts the general appropriations bill. If the resolution is not approved by two-thirds of the members of each house of the legislature, the rates for the following fiscal year shall be the truth in taxation rates determined pursuant to subsection C of this section and shall be transmitted to the superintendent of public instruction and the county boards of supervisors.

H. Notwithstanding subsection C of this section and if approved by the qualified electors voting at a statewide general election, the legislature shall not set a qualifying tax rate that exceeds $2.1265 for a common or high school district or $4.253 for a unified school district. The legislature shall not set a county equalization assistance for education rate that exceeds $0.5123.

I. Pursuant to subsection C of this section, the qualifying tax rate in tax year 2025 for a high school district or a common school district within a high school district that does not offer instruction in high school subjects as provided in section 15-447 is $1.5606 and for a unified school district, a common school district not within a high school district or a common school district within a high school district that offers instruction in high school subjects as provided in section 15-447 is $3.1212.

§ 41-1277 Joint legislative budget committee; annual report; state debt and obligations; definitions

(L21, Ch. 405, sec. 24)

A. On or before January 31 of each year, the joint legislative budget committee staff shall present to the appropriations committees of the senate and the house of representatives a report on state debt and obligations, including:

Outstanding general obligation bonds.
Long-term notes and obligations.
Certificates of participation and other obligations pursuant to any lease-purchase agreements.
Revenue bonds.
Deferred rollover payment obligations.

B. The report shall contain, for the next fiscal year:

The statewide aggregate level of outstanding principal and the principal and interest payments, by type of debt or obligation.
An itemization, by budget unit, of the original due date of each deferred payment for deferred rollover payment obligations, the amount of interest paid to date due to the deferral and the amount of yearly interest to be paid in the most recent and the next fiscal year due to the deferral.
Information on per capita state debt and obligations.
Information on the ten-year history of state debt and obligations based on available data.

C. The report shall be posted on the joint legislative budget committee's website, and a copy of the report shall be provided to any member of the public who makes a request.

D. For the purposes of this section:

"Deferred rollover payment obligation" means an obligation to make a payment in a fiscal year that was due in and deferred from a previous fiscal year.
"State debt and obligations" means debt and obligations for which the principal or interest is paid with state funds.

Article 10.1 Joint Legislative Audit Committee and Auditor General

§ 41-1278 Definitions

In this article, unless the context otherwise requires:

"Committee" means the joint legislative audit committee.
"Investigation" means an inquiry into specified acts or allegations of impropriety, malfeasance or nonfeasance in the obligation, expenditure, receipt or use of public monies or into specified financial transactions or practices that may involve such impropriety, malfeasance or nonfeasance.
"Performance audit" means an audit that determines with regard to the purpose, functions and duties of the audited agency one or more of the following:

(a) Whether the audited agency is managing or using its resources, including public monies of this state, personnel, property, equipment and space, in an economical and efficient manner.

(b) Causes of inefficiencies or uneconomical practices, including inadequacies in management information systems, internal and administrative procedures, organizational structure, use of resources, allocation of personnel, purchasing policies and equipment.

(d) Whether objectives established by the legislature or other authorizing body are being met.

"Special audit" means an audit of limited scope.
"Special research request" means research and analysis of issues or questions that are designated as a special research request by the committee, but does not include a performance audit, financial audit, compliance audit, procedural review, special audit, investigation or evaluation required by law.
"State agency" means all departments, agencies, boards, commissions, institutions and instrumentalities of this state.

§ 41-1279 Joint legislative audit committee; composition; meetings; powers and duties

A. The joint legislative audit committee is established consisting of five members of the senate who are appointed by the president of the senate, one of whom is a member of the senate appropriations committee, and five members of the house of representatives who are appointed by the speaker of the house of representatives, one of whom is a member of the house of representatives appropriations committee. Selection of members shall be based on their understanding of and interest in legislative audit oversight functions. Not more than three appointees of each house shall be of the same political party. The president and the speaker shall designate one of their appointed members as chairperson of their respective delegation. The chairperson of the audit committee shall serve for the term of each legislature. The chairmanship of the audit committee shall alternate between the chairperson of the senate delegation and the chairperson of the house of representatives delegation beginning with the chairperson of the senate delegation. The president of the senate and the speaker of the house of representatives shall also serve as ex officio members of the committee.

B. The committee shall meet at least quarterly and on call of the chairperson. Members of the committee are eligible for reimbursement by their respective houses in the same manner as a member of the legislature who attends a meeting of a standing committee.

C. The committee shall:

Oversee all audit functions of the legislature and state agencies, including sunset, performance, special and financial audits, special research requests and the preparation and introduction of legislation resulting from audit report findings.
Appoint an auditor general subject to approval by a concurrent resolution of the legislature and direct the auditor general to perform all sunset, performance, special and financial audits and investigations.
Have the power of legislative subpoena in accordance with article 4 of this chapter.
Require state agencies to comply with findings and directions of the committee regarding sunset, performance, special and financial audits.
Perform all functions required by chapter 27 of this title relating to the sunset review of state agencies.

§ 41-1279.01 Auditor general; qualifications; term; compensation

A. There shall be an auditor general who shall be appointed by the committee and approved by a concurrent resolution of the legislature. The auditor general must be a certified public accountant licensed to practice in this state and is subject to the standards and ethics of the accounting profession as regulated by the Arizona state board of accountancy.

B. The term of office for the person serving as auditor general is five years beginning on the date of the person's appointment. A person serving as auditor general is eligible for reappointment.

C. A person serving as auditor general may be removed from office at any time by a concurrent resolution of the legislature receiving the concurrence of a majority of the members of each house.

D. The auditor general shall serve full time and is eligible to receive an annual salary as determined pursuant to section 38-611.

§ 41-1279.02 Personnel; criminal history records

A. The auditor general, with the approval of the committee, may appoint and prescribe the duties of such additional professional, technical, clerical and other employees, or contract for such services, necessary to administer the duties of the auditor general's office. The employees shall receive compensation as determined pursuant to section 38-611 and serve at the pleasure of the auditor general.

B. The auditor general may obtain criminal history record information pursuant to section 41-1750, subsection G from the department of public safety for the purpose of employment of personnel by the auditor general.

C. Information obtained pursuant to subsection B of this section shall not be disclosed by the auditor general except to members of the auditor general's staff pursuant to the requirements prescribed by the department of public safety and solely for the purpose of employment of personnel by the auditor general.

§ 41-1279.03 Powers and duties

A. The auditor general shall:

Prepare an audit plan for approval by the committee and report to the committee the results of each audit and investigation and other reviews conducted by the auditor general.
Conduct or cause to be conducted annual financial and compliance audits of financial transactions and accounts kept by or for all state agencies subject to the federal single audit requirements. The audits shall be conducted in accordance with generally accepted governmental auditing standards and accordingly shall include tests of the accounting records and other auditing procedures as may be considered necessary in the circumstances. The audits shall include the issuance of suitable reports as required by the federal single audit requirements so that the legislature, the federal government and others will be informed as to the adequacy of financial statements of this state in compliance with generally accepted accounting principles and to determine whether this state has complied with laws and regulations that may have a material effect on the financial statements and on major federal assistance programs.
Perform procedural reviews for all state agencies at times determined by the auditor general. These reviews may include evaluation of administrative and accounting internal controls and reports on these reviews.
Perform special research requests, special audits and related assignments as designated by the committee and conduct performance audits, special audits, special research requests and investigations of any state agency, whether created by the constitution or otherwise, as may be requested by the committee.
Annually on or before the fourth Monday of December, prepare a written report to the governor and to the committee that contains a summary of activities for the previous fiscal year.
In the fifth year and in each fifth year thereafter in which a transportation excise tax is in effect in a county as provided in section 42-6106 or 42-6107, conduct a performance audit that:

(a) Reviews past expenditures and future planned expenditures of the transportation excise revenues and determines the impact of the expenditures in solving transportation problems within the county and, for a transportation excise tax in effect in a county as provided in section 42-6107, determines whether the expenditures of the transportation excise revenues comply with section 28-6392, subsection B.

(b) Reviews projects completed to date and projects to be completed during the remaining years in which a transportation excise tax is in effect. Within six months after each review period, the auditor general shall present a report to the speaker of the house of representatives and the president of the senate detailing findings and making recommendations.

(c) Reviews, determines, reports and makes recommendations to the speaker of the house of representatives and the president of the senate whether the distribution of Arizona highway user revenues complies with title 28, chapter 18, article 2.

If requested by the committee, conduct performance audits of counties and incorporated cities and towns receiving Arizona highway user revenue fund monies pursuant to title 28, chapter 18, article 2 to determine whether the monies are being spent as provided in section 28-6533, subsection B.
Perform special audits designated pursuant to law if the auditor general determines that there are adequate monies appropriated for the auditor general to complete the audit. If the auditor general determines the appropriated monies are inadequate, the auditor general shall notify the committee. Based on information provided by the auditor general, for any legislative measure that requires the auditor general to perform a special audit, the joint legislative budget committee staff shall notify all the members of the legislature as soon as practicable of the cost to conduct the special audit.
Establish a schoolwide audit team in the office of the auditor general to conduct performance audits and monitor school districts to determine the percentage of every dollar spent in the classroom by the school district. Each school district shall prominently post on its website home page a copy of its profile pages that displays the percentage of every dollar spent in the classroom by that school district from the most recent status report issued by the auditor general pursuant to this paragraph. The auditor general shall determine, through random selection, the school districts to be audited each year, subject to review by the joint legislative audit committee. A school district that is subject to an audit pursuant to this paragraph shall notify the auditor general in writing whether the school district agrees or disagrees with the findings of the audit and whether the school district will implement the recommendations, implement modifications to the recommendations or refuse to implement the recommendations. The school district shall submit to the auditor general a written status report on the implementation of the audit recommendations at the request of the auditor general, within the two-year period following the issuance of an audit conducted pursuant to this paragraph. The auditor general shall review the school district's progress toward implementing the recommendations of the audit and provide status reports of the reviews to the joint legislative audit committee during this two-year period. The auditor general may review a school district's progress beyond this two-year period for recommendations that have not yet been implemented by the school district. The school district shall participate in any hearing scheduled during this review period by the joint legislative audit committee or by any other legislative committee designated by the joint legislative audit committee.
Annually review per diem compensation and reimbursement of expenses for employees of this state and members of a state board, commission, council or advisory committee by judgmentally selecting samples and evaluating the propriety of per diem compensation and expense reimbursements.

B. The auditor general may:

Subject to approval by the committee, adopt rules necessary to administer the duties of the office.
Hire consultants to conduct the studies required by subsection A, paragraphs 6 and 7 of this section.

C. If approved by the committee, the auditor general may charge a reasonable fee for the cost of performing audits or providing accounting services for auditing federal funds, special audits or special services requested by political subdivisions of this state. Monies collected pursuant to this subsection shall be deposited in the audit services revolving fund.

D. The department of transportation, the county treasurer, the county transportation excise tax recipients and the board of supervisors of a county that has approved a county transportation excise tax as provided in section 42-6106 or 42-6107 and the governing bodies of counties, cities and towns receiving Arizona highway user revenue fund monies shall cooperate with and provide necessary information to the auditor general or the auditor general's consultant.

E. The department of transportation or the county transportation excise tax recipients shall reimburse the auditor general as follows, and the auditor general shall deposit the reimbursed monies in the audit services revolving fund:

For the cost of conducting the studies or hiring a consultant to conduct the studies required by subsection A, paragraph 6, subdivisions (a) and (b) of this section, from monies collected pursuant to a county transportation excise tax levied pursuant to section 42-6106 or 42-6107.
For the cost of conducting the studies or hiring a consultant pursuant to subsection A, paragraph 6, subdivision (c) and paragraph 7 of this section, from the Arizona highway user revenue fund.

§ 41-1279.04 Authority to examine records; violation; classification; attorney general supervision

A. The auditor general or the auditor general's authorized representatives, in the performance of official duties, shall have access to employees and the authority to examine any and all books, accounts, reports, vouchers, correspondence files and other records, bank accounts, criminal history record information as defined in section 41-1701 and in accordance with section 41-1750, monies and other property of any state agency, board, commission, department, institution, program, advisory council or committee or political subdivision of this state, whether created by the constitution or otherwise, or such documents and property of a contractor relating to a contract with this state pursuant to section 35-214. Any such agency or political subdivision that has such records under the officer's or employee's control, shall allow access to and examination of the records on the request of the auditor general or the auditor general's authorized representative.

B. The auditor general or the auditor general's authorized representatives, in the performance of official duties, shall have access to financial institutions' or financial enterprises' information, accounts, books, records, statements, reports, communications, transactions or any other information relating to any state agency, board, commission, department, institution, program, advisory council or committee or political subdivision of this state, whether created by the constitution or otherwise. On request of the auditor general or the auditor general's representatives and in the form and at the time prescribed by the auditor general, the financial institution or financial enterprise shall provide all information requested by the auditor general or the auditor general's authorized representative. An authorized representative of the financial institution or financial enterprise shall certify all information provided to the auditor general or auditor general's authorized representatives. Costs or fees associated with producing the information requested by the auditor general or auditor general's authorized representatives shall be paid by the state agency, board, commission, department, institution, program, advisory council or committee or political subdivision. A financial institution or financial enterprise is not liable to the state agency, board, commission, department, institution, program, advisory council or committee or political subdivision for providing to the auditor general or auditor general's authorized representatives information requested pursuant to this subsection.

C. For the purpose of complying with section 41-1279.03, subsection A, paragraphs 4 and 9, the auditor general or the auditor general's authorized representative, in the performance of official duties, may attend executive sessions of the governing body of any state agency or school district in this state.

D. For the purpose of auditing the department of revenue, the auditor general and the auditor general's authorized representatives have access to state tax returns, except that a report of the auditor general shall not violate the confidentiality of state tax laws.

E. For the purpose of complying with subsection A of this section, all officers of any state agency, board, commission, department, institution, program, advisory council or committee or political subdivision of this state shall provide reasonable space for auditor general staff and make records available, in the form and at the time prescribed.

F. Any officer or person who knowingly fails or refuses to allow access and examination pursuant to this section or who knowingly obstructs or misleads the auditor general in the execution of the auditor general's duties is guilty of a class 2 misdemeanor.

G. The attorney general shall supervise the prosecution of all offenders under this section.

§ 41-1279.05 Confidential records of auditor general; exemptions; divulgence of restricted information; violation; classification

A. Working papers and other audit files maintained by the auditor general are not public records and are exempt from title 39, chapter 1. The information contained in such working papers and audit files prepared pursuant to a specific audit is not subject to disclosure, except to the attorney general and to any county attorney in connection with an investigation made or action taken in the course of their official duties.

B. If the committee approves a special research request, on request for disclosure by the president of the senate or the speaker of the house of representatives, the auditor general shall disclose information contained in the special research request working papers and audit files to the president of the senate or the president's designee, the speaker of the house of representatives or the speaker's designee and the chairman of the joint legislative audit committee for the purpose of overseeing the special research request. Information contained in the special research request working papers and audit files is not a public record, is exempt from title 39, chapter 1 and is not subject to disclosure except as provided in this section. A person shall not further disclose the information that is obtained from the auditor general.

C. If the auditor general, any member of the auditor general's staff, any other employee or any person who has obtained information pursuant to subsection B knowingly divulges or makes known in any manner not permitted by law any particulars of any record, document, or information the disclosure of which is restricted by law, the person is guilty of a class 5 felony.

§ 41-1279.06 Audit services revolving fund; use; exemption from lapsing

A. The audit services revolving fund is established. The auditor general shall administer the fund. The fund consists of any monies received by the auditor general from:

State budget units for audits of federal funds required under federal law and federal rules and regulations.
State budget units and counties, community college districts and school districts for which the auditor general performs special audits, financial statement audits or audits of federal funds received under federal laws, rules and regulations or provides accounting services.
Counties where the auditor general conducts a performance audit of the transportation excise tax as prescribed by section 41-1279.03.
Any other source authorized by law.

B. The auditor general shall use the fund monies for the purpose of conducting audits required under federal law, special audits or financial statement audits or accounting services requested by state budget units and counties, community college districts and school districts or to pay for certified public accountants to conduct such audits or provide such services.

C. Monies in the audit services revolving fund are exempt from the provisions of section 35-190, relating to lapsing of appropriations.

§ 41-1279.07 Uniform expenditure reporting system; reports by counties, community college districts, cities and towns; certification and attestation; assistance by auditor general; attorney general investigation; violation; classification

A. The auditor general shall prescribe a uniform expenditure reporting system for all political subdivisions subject to the constitutional expenditure limitations prescribed by article IX, sections 20 and 21, Constitution of Arizona. The system shall include:

For counties:

(a) An annual expenditure limitation report that includes at least the following information:

(i) The expenditure limitation established for the reporting fiscal year by the economic estimates commission.

(ii) Total expenditures, by fund, for the reporting fiscal year.

(iii) Total exclusions from local revenues, as defined by article IX, section 20, Constitution of Arizona, by fund, for the reporting fiscal year.

(iv) Total amounts, by fund, of expenditures subject to the expenditure limitation for the reporting fiscal year.

(b) Annual financial statements prepared in accordance with generally accepted accounting principles.

(c) A reconciliation of the total expenditures reported within the financial statements to the total expenditures stated within the expenditure limitation report.

For community college districts:

(a) An annual budgeted expenditure limitation report that includes at least the following information:

(i) The expenditure limitation established for the reporting fiscal year by the economic estimates commission.

(ii) Total budgeted expenditures for the reporting fiscal year.

(iii) Total exclusions from local revenues, as defined by article IX, section 21, Constitution of Arizona, for the reporting fiscal year.

(iv) Total amounts of budgeted expenditures subject to the expenditure limitation for the reporting fiscal year.

(b) Annual financial statements prepared in accordance with generally accepted accounting principles.

(c) A reconciliation of the total expenditures reported within the financial statements to the total expenditures reported within the expenditure limitation report.

For cities and towns:

(a) An annual expenditure limitation report that includes at least the following information:

(i) The expenditure limitation established for the reporting fiscal year by the economic estimates commission and, if applicable, the voter approved alternative expenditure limitation.

(ii) Total expenditures, by fund, for the reporting fiscal year.

(iii) Total exclusions from local revenues, as defined by article IX, section 20, Constitution of Arizona, by fund, for the reporting fiscal year or, if applicable, the total exclusions from the voter approved alternative expenditure limitation.

(iv) Total amounts, by fund, of expenditures subject to the expenditure limitation for the reporting fiscal year.

(b) Financial statements prepared in accordance with generally accepted accounting principles.

(c) A reconciliation of the total expenditures reported within the financial statements to the total expenditures reported within the expenditure limitation report.

B. The auditor general shall provide detailed instructions for completion and submission of the reports described in subsection A of this section. The auditor general shall prescribe definitions for terms used in and the form of the reports described in subsection A of this section. The reports described in subsection A of this section are required of counties and community college districts beginning with fiscal year 1981-1982. The reports described in subsection A of this section are required of cities and towns beginning with the fiscal year the political subdivision is subject to the expenditure limitation. The annual reporting requirements also apply to political subdivisions subject to an alternative expenditure limitation enacted pursuant to article IX, section 20, subsection (9), Constitution of Arizona.

C. The reports described in subsection A of this section must be filed with the auditor general within nine months after the close of each fiscal year.

D. The auditor general or a certified public accountant performing the annual audit required pursuant to sections 41-1279.21 and 9-481 shall attest to the expenditure limitation reports and financial statements for counties, community college districts and cities. The certified public accountant performing the annual or biennial audit required pursuant to section 9-481 shall attest to the expenditure limitation reports and financial statements for towns.

E. The governing body of each political subdivision shall provide to the auditor general by July 31 each year the name of the chief fiscal officer designated by the governing body of the political subdivision to officially submit the current fiscal year's expenditure limitation report on behalf of the governing body. The governing body of the political subdivision shall notify the auditor general of any changes of individuals designated to file the required reports. The designated chief fiscal officer shall certify to the accuracy of the annual expenditure limitation report.

F. The auditor general shall prescribe forms for the uniform reporting system and may provide assistance to individuals, certified public accountants or public accountants responsible for attesting to the expenditure limitation reports and financial statements.

G. Each political subdivision, subject to the expenditure limitations prescribed by article IX, sections 20 and 21, Constitution of Arizona, shall comply with the uniform expenditure reporting system, instructions and forms prescribed by the auditor general. The auditor general may notify the committee and the attorney general if any political subdivision does not comply with the uniform expenditure reporting system, instructions or forms prescribed by the auditor general. The attorney general may file a petition for special action in any court of competent jurisdiction to compel any political subdivision to comply with this section. The attorney general may apply for injunctive relief in any court of competent jurisdiction to enjoin any political subdivision from violating this section. Injunctive and special action proceedings are in addition to all other penalties and other remedies prescribed by law.

H. A chief fiscal officer, designated pursuant to subsection E of this section, who subsequent to July 1, 1983 refuses to file the reports required by this section within the prescribed time periods or who intentionally files erroneous reports is guilty of a class 1 misdemeanor. A city or town exceeding the expenditure limitation prescribed or authorized pursuant to article IX, section 20, Constitution of Arizona, for any fiscal year, without authorization pursuant to such section, shall have the amount specified in subsection I of this section of its allocations of the state income tax, distributed pursuant to section 43-206, withheld and redistributed to other cities and towns in the same manner as determined pursuant to that section, except that the population of the city or town exceeding the expenditure limitation shall not be included in the computation, and the city or town exceeding the expenditure limitation shall not be entitled to share in the redistribution. A community college district exceeding the expenditure limitation prescribed pursuant to article IX, section 21, Constitution of Arizona, for any fiscal year, without authorization pursuant to such section or section 15-1471, shall have the amount specified in subsection I of this section of its allocations of state aid, distributed pursuant to section 15-1466, withheld.

I. The auditor general shall hold a hearing to determine if any political subdivision has exceeded the expenditure limitations prescribed pursuant to article IX, sections 20 and 21, Constitution of Arizona. If a county has exceeded the expenditure limitations prescribed pursuant to article IX, section 20, Constitution of Arizona, without authorization pursuant to that section, the auditor general shall notify the board of supervisors of the county to reduce the allowable levy of primary property taxes of the county pursuant to section 42-17051, subsection C. If any political subdivision other than a county has exceeded the expenditure limitations prescribed pursuant to article IX, sections 20 and 21, Constitution of Arizona, without authorization, the auditor general shall notify the state treasurer to withhold a portion of the political subdivision's allocations of the revenues described in subsection H of this section for the fiscal year subsequent to the auditor general's hearing as follows:

If the excess expenditures are less than five percent of the limitation, an amount equal to the excess expenditures.
If the excess expenditures are equal to or greater than five percent but less than ten percent of the limitation, or are less than five percent of the limitation but it is at least the second consecutive instance of excess expenditures, an amount equal to triple the excess expenditures.
If the excess expenditures are equal to or greater than ten percent of the limitation, an amount equal to five times the excess expenditures or one-third of the allocation of the revenues described in subsection H of this section, whichever is less.

J. A county, city or town is not deemed to have exceeded the expenditure limitation if the county, city or town makes expenditures for capital improvements from utility revenues pursuant to title 9, chapter 5, article 3 or from excise taxes levied by the county, city or town for a specific purpose and the county, city or town repays the expenditure from the proceeds of bonds or other lawful long-term obligations before the hearing required by subsection I of this section.

Article 10.2 Postaudit of Counties, Community College Districts and School Districts

§ 41-1279.21 Powers and duties of auditor general relating to counties, school districts, community colleges and county treasurers

A. In addition to other powers and duties prescribed by law, the auditor general shall:

Conduct or cause to be conducted annual financial statement audits of financial transactions and accounts kept by or for all counties. For a county that is required to comply with the federal single audit requirements, audits shall include compliance audits of financial transactions and applicable accounts kept by or for the county. The audits shall be conducted in accordance with generally accepted governmental auditing standards and, accordingly, shall include tests of the accounting records and other auditing procedures as may be considered necessary under the circumstances. Each county shall provide financial information for inclusion in the annual audit that verifies that Arizona highway user revenue fund monies received by the county pursuant to title 28, chapter 18, article 2 and any other dedicated state transportation revenues received by the county are being used solely for the authorized transportation purposes.
Perform procedural reviews for school districts that are not required to comply with the federal single audit requirements at times determined by the auditor general. These reviews may include evaluation of administrative and accounting internal controls and reports on such reviews.
Conduct or cause to be conducted annual financial statement audits of financial transactions and accounts kept by or for community college districts. For a community college district that is required to comply with the federal single audit requirements, audits shall include compliance audits of financial transactions and applicable accounts kept by or for the community college district. The audits shall be conducted in accordance with generally accepted governmental auditing standards and, accordingly, shall include tests of the accounting records and other auditing procedures as may be considered necessary under the circumstances.
Approve contracts for financial and compliance auditing services except if specific statutory authority is otherwise provided. The auditor general shall ensure that such contract audits are conducted in accordance with generally accepted governmental auditing standards and shall determine if such audits meet minimum audit standards prescribed by the auditor general. An audit shall not be accepted as meeting the requirements of this paragraph until it has been approved by the auditor general.
Order and enforce a correct and uniform system of accounting by county, community college district and school district officers and instruct them in the proper mode of keeping accounts of their offices.
Require of county treasurers and custodians of county, community college district or school district funds, as often as the auditor general deems necessary, a verified statement of their accounts.
Report to the committee and to the attorney general the refusal or neglect of any county, community college district or school district officer to conform to rules and regulations of the auditor general's office.
Report to the committee and to the governor the result of the auditor general's examinations of county, community college district and school district offices as often as required by public interest.
Perform procedural reviews of county treasurers' offices. These reviews may include evaluating compliance with the uniform system of accounting for county treasurers prescribed by the auditor general and administrative and accounting internal controls. The auditor general shall provide in writing the results of the procedural review, including any recommendations, to the county treasurer, county board of supervisors and joint legislative audit committee. A county treasurer's office that is subject to a review pursuant to this paragraph shall notify the auditor general in writing whether the county treasurer's office agrees or disagrees with the findings of the review and whether the county treasurer's office will implement the recommendations, implement modifications to the recommendations or refuse to implement the recommendations. At the request of the auditor general, the county treasurer shall submit to the auditor general a written status report on correcting the deficiencies and implementing the recommendations of the procedural review within a one-year period after receiving the results of the procedural review. The auditor general shall follow up and review the county treasurer's progress toward correcting the deficiencies and implementing the recommendations of the procedural review and provide a status report to the county board of supervisors and the joint legislative audit committee during the one-year period. The auditor general may review a county treasurer's progress after the one-year period if there are deficiencies that the county treasurer has not corrected or recommendations that the county treasurer has not implemented. The county treasurer shall participate in any hearing scheduled during this review period by the joint legislative audit committee or by any other legislative committee designated by the joint legislative audit committee.

B. The auditor general may adopt rules providing for disapproving contracts, and suspending or debarring any contractor providing financial and compliance auditing services to a school district based on applicable standards similar to those adopted by this state under section 41-2613.

C. Notwithstanding any other law, the disapproval of a contract or the suspension or debarment may be appealed to the superior court pursuant to title 12, chapter 7, article 6.

Article 11 Bribery

§ 41-1281 Definitions

In this article, unless the context otherwise requires:

"Bribe" means any money, goods, right in action, property, thing of value or advantage, present or prospective, asked, offered, given, accepted or promised with a corrupt intent to influence, unlawfully, the person to whom it is given in his action, vote or opinion, in any official capacity.

Article 12 Joint Legislative Committees

§ 41-1292 Joint legislative oversight committee on the department of child safety

A. The joint legislative oversight committee on the department of child safety is established consisting of the following members:

The chairperson of the senate committee that addresses child safety issues.
The chairperson of the house of representatives committee that addresses child safety issues.
Two members of the senate who are appointed by the president of the senate and who are members of different political parties.
Two members of the house of representatives who are appointed by the speaker of the house of representatives and who are members of different political parties.

B. The chairperson of the senate committee that addresses child safety issues and the chairperson of the house of representatives committee that addresses child safety issues shall serve as cochairpersons.

C. The committee shall meet at least biannually, and a majority of the members constitutes a quorum for the transaction of business.

D. The committee shall review:

The department's implementation of policy and procedures and program effectiveness.
All reports on program outcomes released by the department to the legislature for trends and areas for statutory improvement and audits issued by the office of the auditor general related to the department.
Policies and procedures relating to guardianships and dependency proceedings.
Systemic factors related to alleged child maltreatment fatalities and near fatalities. In reviewing alleged child maltreatment fatalities or near fatalities, the committee may:

(a) Critically analyze the systemic factors that may have contributed to an alleged child maltreatment fatality or near fatality, including the laws, policies and practices of the department of child safety, the department of economic security, the Arizona health care cost containment system and any other state agency that may have been involved in the safety and welfare of the child or with the child's family and the perpetrator, including any economic, health, social services, supports and resources, to identify improvements that could mitigate future child maltreatment fatalities or near fatalities.

(b) Review interagency coordination and communication.

(c) Identify best practices and services that may prevent future maltreatment fatalities or near fatalities and review the recommendations submitted by the child safety fatality and near fatality review team established by section 8-469 and the state fatality review team established by section 36-3501.

(d) Enter into executive session when necessary to promote the privacy and safety of the decedent’s family or employees of the department of child safety.

(e) Review reports produced and presented by the child safety fatality and near fatality review team established by section 8-469 and request additional information and follow up on details associated with a report.

Chapter 8 Agencies of the Legislative Department

Article 1 Legislative Council

§ 41-1301 Legislative council; members; terms; meetings

A. There is established a legislative council which consists of the president of the senate and six members of the senate appointed by the president, and the speaker of the house of representatives and six members of the house of representatives appointed by the speaker, who serve for terms of two years terminating upon the convening of the regular session of the legislature each odd numbered year. The term of a member terminates immediately upon his ceasing to be a member of the legislature, but a member appointed to fill a vacancy caused otherwise than by expiration of term shall be appointed by the president of the senate or the speaker of the house of representatives, as the case may be, from the same body of the legislature from which his predecessor was appointed. The president of the senate and the speaker of the house of representatives shall cooperate in the selection of members to serve on the legislative council to the end that, insofar as possible, each geographical area of the state has representation on the council.

B. The speaker of the house of representatives shall chair the council in even numbered years, and the president of the senate shall chair the council in odd numbered years. The council shall meet and organize by electing from among its membership additional officers as are deemed necessary or advisable. The council shall meet as often as the members deem necessary, and a majority of the members constitutes a quorum for the transaction of business.

§ 41-1303 Minutes; reports

A. The council shall keep complete minutes of its meetings which shall be filed with the secretary of the senate and the chief clerk of the house of representatives.

B. The council shall prepare an annual report to be submitted to each regular session of the legislature containing such recommendations and other material as the council deems advisable. The council may, from time to time, make special reports for presentation to the legislature.

§ 41-1304 Powers and duties

A. The legislative council shall:

Provide bill drafting, research and other services to the legislature deemed necessary or advisable by the council to improve the quality of legislation and to ensure full participation by the legislative branch in determining and reviewing policy and the administration of state affairs.
Adopt rules and formulate policies for the administration of this article and for the conduct of the affairs of the council.
Appoint clerical, technical and professional assistants deemed necessary or advisable to carry out this article, fix their compensation and prescribe their powers and duties.
Maintain a legislative reference library.
Procure information at the request of members of the legislature on any legislative subject.
Prepare or revise bills and other legislative measures for members or committees of the legislature and, on request of a member of the legislature, for state officers and agencies.
Prepare and issue styles and forms for drafting bills, amendments and other legislative measures for the use of the legislature, state officers and persons interested in drafting amendments and bills or measures for introduction in the legislature, except that a font color other than black shall be used when preparing or revising temporary law for bills and amendments. The styles and forms for drafting amendments shall be developed and adopted in consultation and cooperation with the senate and the house of representatives.
Prepare and file with the secretary of state, not later than ten days preceding the regular primary election, an analysis of the provisions of each ballot proposal of a measure or proposed amendment.

B. The legislative council may purchase, lease and otherwise acquire land and buildings and make improvements to land and buildings it acquires or uses for the purpose of providing suitable facilities for the use of the legislative department. The council may obtain operational and maintenance assistance for any legislative facilities without charge from the department of administration, may obtain security assistance from the department of public safety, may employ personnel to discharge operational, maintenance and security functions or may contract for outside services payable from council appropriations.

C. The legislative council shall pay legal fees incurred jointly by the house of representatives and the senate on the authorization of the speaker of the house of representatives and the president of the senate.

§ 41-1304.01 Continuing code revision

A. The director of the Arizona legislative council shall provide for:

The preparation and submission to the legislature of a report as to defects in the constitution and laws of Arizona.
The drafting in the form of bills and resolutions of proposed legislation to carry out the recommendations contained in the report as to defects in the constitution and laws of Arizona. All drafting in the form of bills and resolutions of proposed legislation to correct defects in the constitution and laws of Arizona that were subject to a successful referendum shall be submitted to the legislature separately from all other drafts to correct reported defects.
The arranging for publication of annotations of decisions of the supreme court of Arizona.
The preparation, arranging and correlation for publication, at the end of each legislative session, of the laws enacted during the session.
The preparation, arranging and correlation for publication of other laws enacted.

B. The director may prepare for submission to the legislature a rewriting and revision, in simplified style, phraseology and order, of any title, chapter, article or sections of the Arizona Revised Statutes.

§ 41-1304.02 Preparing the statutes for publication; revisions

A. The director of the Arizona legislative council, in carrying out section 41-1304.01, subsection A, paragraphs 4 and 5, shall not alter the sense, meaning or effect of any law but may:

Renumber sections and parts of sections of newly enacted text.
Rearrange sections, parts of sections, articles, chapters and titles.
Change reference numbers to agree with renumbered sections, parts of sections, articles, chapters or titles.
Substitute the proper section, article, chapter or title for the terms "the preceding section", "this article" and "this act" and similar terms.
Substitute the actual date for the terms "the effective date of this section" and "the effective date of this amendment to this section" and similar terms.
Strike out figures where they are merely a repetition of written words.
Change capitalization for the purpose of uniformity.
Correct manifest clerical, typographical and electronic database errors in statutory and nonstatutory text.

B. The director shall:

Omit from the statutes all temporary laws, all titles to acts, all enacting and repealing clauses, all declarations of emergency, and all purpose, validity and construction clauses unless, from their nature, it may be necessary to retain some of them to preserve the full meaning and intent of the law.
Include in the statutes any provision that was enacted as temporary law but that, by its nature, will have continuing application or effect.

C. The director shall not undertake to make any change of:

Existing laws, it being the intention of this section that the director shall in no manner assume to exercise legislative power.
A provision that is subject to a referendum until the provision becomes law as provided in the Constitution of Arizona.

§ 41-1304.03 Authority to blend sections amended or added more than once before publication

When a section of the statutes is added or amended by two or more enactments, or if a section of the Constitution of Arizona is amended by vote of the people on two or more ballot propositions, after the most recent official publication of the statutes, the director of the Arizona legislative council may, when preparing the laws for the next publication, combine the multiple versions of each respective section into a single section, except that:

In so doing the director may not effect a substantive change in the existing statutes or the provisions of the new enactment.
A provision that is subject to a referendum shall not be combined with any other amendment or addition of the same section until the provision becomes law as provided in the Constitution of Arizona.

§ 41-1304.04 Authority to accept and expend in the name of the legislature public and private gifts and grants

The Arizona legislative council may accept and expend in the name of the legislature public and private gifts and grants.

§ 41-1304.05 Architect of the capitol; state capitol building areas and other facilities; jurisdiction; maintenance; definition

A. The office of the architect of the capitol is established in the Arizona legislative council. The director of the Arizona legislative council shall select an architect of the capitol and other personnel necessary to develop and maintain a master plan for the state capitol complex. The architect of the capitol appointed by the director of the Arizona legislative council must have master planning experience and experience working with the state historic preservation office and historic government buildings. The architect of the capitol shall submit the master plan to the members of the Arizona legislative council for approval at least once during each regular session of the legislature.

B. The Arizona legislative council is responsible for the allocation of space, operation, alteration, renovation and control of the following:

The original 1898 statehouse area of the state capitol building known as the state capitol museum.
The 1919 wing and the 1938 justice addition of the state capitol building known jointly as the legislative services wing.
Any other facility acquired for legislative use and placed under legislative council jurisdiction and the grounds adjacent to it.
Except as provided in subsection D, paragraph 2 of this section, the Wesley Bolin memorial plaza east of the state capitol building.
Except as provided in subsections C and D of this section, the grounds adjacent to the state capitol museum, the legislative services wing, the house of representatives wing and the senate wing and comprising the area east of the state capitol executive tower with a northern boundary of West Adams street, an eastern boundary of Seventeenth avenue and a southern boundary of West Jefferson street in Phoenix, Arizona.

C. The speaker of the house of representatives is responsible for the following:

The allocation of space, operation, alteration, renovation and control of the house of representatives wing of the state capitol building.
The allocation of space and control of the parking lot area adjacent to the house of representatives wing, the parking lot area with a southern boundary of West Adams street, an eastern boundary of seventeenth avenue and a northern boundary of West Monroe street in Phoenix, Arizona and comprised of one hundred five parking spaces and the southeast portion of the parking lot area with a southern boundary of West Monroe street and an eastern boundary of Seventeenth avenue in Phoenix, Arizona and comprised of fifty parking spaces.

D. The president of the senate is responsible for the following:

The allocation of space, operation, alteration, renovation and control of the senate wing of the state capitol building.
The allocation of space and control of the parking lot area adjacent to the senate wing and the southwest portion of the parking lot area of the Wesley Bolin memorial plaza east of the state capitol building and comprised of one hundred twenty parking spaces.

E. The joint legislative budget committee is responsible for the allocation of space, operation, alteration, renovation and control of the building located at 1716 West Adams street in Phoenix.

F. The director of the department of administration is responsible for the maintenance of the entire state capitol building.

G. For the purposes of this section, "control" includes security services.

§ 41-1304.06 Authorization for collection of rental; basis of payment; exception; definition

A. Each state department and each state agency when using space under the jurisdiction of the legislative council or the speaker of the state house of representatives or the president of the state senate shall pay a rental as prescribed in subsection B to the legislative council, speaker or president, as appropriate, for deposit in the capital outlay stabilization fund.

B. The rental authorized by the terms of subsection A shall be determined by the joint legislative budget committee after recommendation by the speaker and president prior to the beginning of each fiscal year. The agency shall pay rent in one annual payment regardless of whether the department or agency is funded in whole or in part by state monies.

C. This section does not apply to the secretary of state if the space used pursuant to this section is primarily being used by the Arizona state library, archives and public records for the purposes prescribed by statute.

D. For the purposes of this section, "state department" or "state agency" means any department or agency of the executive or judicial branch of state government.

§ 41-1304.07 Presidential executive orders; review; attorney general

A. At the request of one or more members of the legislature, the executive director of the legislative council shall review any executive order issued by the president of the United States that has not been affirmed by a vote of Congress and signed into law as prescribed by the Constitution of the United States.

B. On review, a member of the legislature may recommend to the attorney general that the order be further examined by the attorney general to determine the legality of the order. If the attorney general determines the order is illegal, the attorney general may file a declaratory judgment action in federal district court.

§ 41-1305 Publications

Beginning in fiscal year 1995-1996 and each year thereafter, the legislative council in conjunction with the senate and the house of representatives shall prepare copies of all laws, memorials, resolutions and other official legislative actions enacted or adopted in each session of the legislature, provide for their printing as session laws and provide for their distribution and sale pursuant to chapter 7, article 5.1 of this title.

§ 41-1306 State capitol museum; management

The director of the Arizona legislative council shall direct and manage the state capitol museum.

§ 41-1307 Museum gift shop revolving fund; exemption

A. The museum gift shop revolving fund is established consisting of gift shop proceeds received from the sale of goods, gifts, nonfederal grants and donations. The director of the Arizona legislative council shall administer the fund. Monies in the fund are continuously appropriated. The director shall use the monies in the fund to provide to the public goods for sale that are reflective of the themes of the state capitol museum and this state.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

Article 4 Legislative Governmental Mall

§ 41-1362 Department of administration; powers and duties; governmental mall description; duty of city of Phoenix; general plan application

A. The department of administration may:

Accept gifts or grants of monies or other property from any person, including the United States or any agencies, departments or officers of the state.
Prescribe rules as necessary to carry out this article.

B. The department of administration shall:

Develop and maintain and amend as necessary a comprehensive long-range general plan for the development of the governmental mall composed of the area described in subsection C of this section.
Encourage public agencies as defined in section 11-951 to enter into intergovernmental agreements or contracts pursuant to title 11, chapter 7, article 3 as necessary to implement the general plan for the development of the governmental mall.
Review and approve or disapprove in writing requests for permission to develop structures or sites or award construction contracts for new buildings or improvements within the governmental mall. The department shall review requests submitted by this state or a political subdivision of this state in which this state or political subdivision has a contractual interest to ensure consistency with the approved general plan.
Review all planning activities within governmental mall boundaries.
Publish an annual report on the issues brought before the department and its recommendations.

C. The governmental mall is composed of the area with a western boundary of nineteenth avenue, a northern boundary of all lots abutting Van Buren street, an eastern boundary of seventh avenue and a southern boundary of the Harrison street alignment.

D. The city of Phoenix annually shall inform the department of administration of new major development projects and new major infrastructure improvements, including parks, streets and street-scaping within the downtown area redevelopment plan as defined in section 36-1471.

E. If the general plan of the city, county or state agency for land development does not conform with the general plan developed by the department of administration for the development of the governmental mall, the general plan developed by the department for the development of the governmental mall applies and shall be enforced.

§ 41-1363 Monuments and memorials within governmental mall; legislative authorization; approval; procedure

A. Notwithstanding section 34-225 or any other law, a monument or memorial recognizing or honoring a person, group, entity or event shall be located in the governmental mall only if a prior legislative act authorizes the monument or memorial.

B. After legislative authorization, a monument or memorial may be established by the following procedures:

The proponents shall submit a concept to the legislative council for the design, dimensions and location of the monument or memorial.
The legislative council shall review the concept and determine the most appropriate location that highlights the monument or memorial and preserves the integrity of the governmental mall.
After recommendations from the historical advisory commission regarding the historical integrity of the monument or memorial and after any necessary negotiations with the proponents, the legislative council shall approve the final design, dimensions, location and maintenance requirements of the monument or memorial, the minimum dollar amount required for deposit in the state monument and memorial repair fund established by section 41-1365 and any statement, declaration, writing or inscription that will be imprinted or stamped on the monument or memorial.
Before construction of the monument or memorial begins, the proponents shall enter into a contract with the legislative council specifying the conditions of the design, dimensions and location of the monument or memorial, a list of the artists, contractors and subcontractors that will be employed, the minimum dollar amount required for deposit in the state monument and memorial repair fund established by section 41-1365 and a verification that all employees for the project are insured and that this state is indemnified against any liability in regard to the construction.
An approved monument or memorial shall be completed and dedicated to this state within two years after the effective date of the legislative act authorizing the monument or memorial.

C. Except as otherwise provided in this section or section 41-1365, all fundraising and the establishment and administration of a fund for deposit of monies and contracts for artistic design and construction of the monument or memorial are the sole responsibility of the proponents.

D. If the completed monument or memorial deviates from the final design or dimension that was approved by the legislative council or any statement, declaration, writing or inscription that is imprinted or stamped on the monument or memorial deviates from that which was approved by the legislative council, the proponents are responsible for any costs incurred to conform the monument or memorial to the approved form.

E. The proponents shall collect an amount equal to at least ten percent of the artistic design and construction costs of the monument or memorial or the amount approved by the legislative council as provided in subsection B of this section. The legislative council shall deposit these monies in the state monument and memorial repair fund established by section 41-1365 for the maintenance, repair, reconditioning or relocation of that monument or memorial. The monies must be deposited in the fund before the beginning of construction of the monument or memorial.

F. The legislative council may relocate monuments or memorials that are located in the governmental mall.

G. This section does not apply to monuments or memorials in which a political subdivision has a contractual interest and that are located in the governmental mall but that are outside Wesley Bolin plaza.

§ 41-1364 Alteration or modification to monuments and memorials within governmental mall; procedures; approval

A. Any alteration or modification to an existing monument or memorial that was completed pursuant to section 41-1363 must abide by the following procedures:

The proponents of the monument or memorial that submitted the concept pursuant to section 41-1363 shall submit the proposed alteration or modification to the legislative council.
After recommendations from the historical advisory commission regarding what impact the proposed alteration or modification would have on the historical integrity of the existing monument or memorial and after any necessary negotiations with the proponents, the legislative council shall approve or reject the proposed alteration or modification.
If the proposed alteration or modification is approved and before the beginning of construction involved in implementing the alteration or modification to the monument or memorial, the proponents shall enter into a contract with the legislative council specifying the scope of the alteration or modification to the monument or memorial, a list of the artists, contractors and subcontractors that will be employed and a verification that all employees for the project are insured and that this state is indemnified against any liability in regard to the construction involved in implementing the alteration or modification to the monument or memorial.
The alteration or modification to an existing monument or memorial shall be completed and dedicated to this state within two years after the effective date of the approval of the alteration or modification by the legislative council.

B. All fundraising and the establishment and administration of a fund for deposit of monies and contracts for artistic design and construction of the alteration or modification to the existing monument or memorial are the sole responsibility of the proponents.

§ 41-1365 State monument and memorial repair fund; purpose; annual report; exemption

A. The state monument and memorial repair fund is established consisting of:

Donations.
Monies from fundraising activities.
Monies that are collected by the proponents of a monument or memorial and that are deposited pursuant to section 41-1363.
Grants received for monuments or memorials, except for otherwise specifically dedicated grants.
Legislative appropriations.

B. The legislative council shall administer the fund. All monies in the fund are continuously appropriated. Subject to this section, the legislative council shall use monies in the fund to:

Maintain, repair, recondition or relocate monuments or memorials.
Support mechanical equipment in the governmental mall.

C. The legislative council shall separately account for monies to a specific monument or memorial that is dedicated to this state for maintaining, repairing, reconditioning or relocating that monument or memorial as follows:

Monies that are donated for the benefit of the specific monument or memorial.
Monies that are derived from fundraising activities and that are collected for the benefit of a specific monument or memorial.
Monies that are collected and deposited pursuant to subsection A, paragraph 3 of this section.

D. On or before November 1 of each year, the legislative council shall submit to the joint legislative budget committee a report that accounts for all monies deposited in the fund. The report shall include the sources of the monies received for deposit, by category, and the purposes for which the monies were used during the preceding fiscal year.

E. The legislative council shall hold the monies in the fund in trust for the citizens of this state until spent on an authorized monument or memorial, and monies in the fund shall not be spent or appropriated for any other purpose.

F. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

Article 5 Office of Ombudsman-Citizens Aide

§ 41-1371 Definitions

In this article, unless the context otherwise requires:

"Administrative act" means an action, decision, omission, recommendation, practice, policy or procedure of an agency but does not include the preparation or presentation of legislation or the substantive content of a judicial order, decision or opinion.
"Agency" means a department, office, corporation, authority, organization, commission, council or board of the executive branch of state government, a department, office, institution, authority, organization, commission, committee, council or board of state government that is independent of the executive or legislative branches of state government or an officer, employee or member of an agency acting or purporting to act in the exercise of official duties. Agency does not mean the judicial department of state government, the board of regents, universities or community college districts.
"Record" means any document, photograph, film, exhibit or other item developed or received under law or in connection with the transaction of official business except an attorney's work product, communications that are protected under the attorney-client privilege and confidential information as defined in section 41-1378, subsection D, paragraph 4.

§ 41-1372 Exemptions

This article does not apply to:

Any elected state official.
Chief advisors who maintain a direct, confidential and advisory relationship with:

(a) The governor.

(b) The secretary of state.

(d) The state treasurer.

(e) The state mine inspector.

(f) The superintendent of public instruction.

(g) A commissioner of the corporation commission.

An agency attorney who maintains an attorney-client relationship with either:

(a) An officer or employee of an agency acting in the exercise of the officer's or employee's duty.

(b) An elected official who is listed under paragraph 2.

The staff of the legislature.

§ 41-1373 Ombudsman-citizens aide selection committee

A. When there is a vacancy in the office of ombudsman-citizens aide, or within twelve months before the expiration of the term of office, the ombudsman-citizens aide selection committee is established consisting of:

Two members of the senate appointed by the president of the senate. One member shall be from each political party.
Two members of the house of representatives appointed by the speaker of the house of representatives. One member shall be from each political party.
One public member who is appointed by the president of the senate and who represents a large business that is regulated by this state.
One public member who is appointed by the speaker of the house of representatives and who represents a small business that is regulated by this state.
Three members who are appointed by the governor and who represent:

(a) A consumer group that is not regulated by this state.

(b) State employees who hold managerial positions.

B. The appointing officers shall appoint the members of the committee when a vacancy occurs in the office of ombudsman-citizens aide. The committee shall receive applications and nominate by a two-thirds vote one candidate for ombudsman-citizens aide according to its adopted procedures. The appointment of the ombudsman-citizens aide from this nomination is made by passage of a bill on a roll call vote of two-thirds of the membership of each house of the legislature. Membership on the ombudsman-citizens aide selection committee expires when the appointment is approved. If the governor disapproves the bill, he shall return it to the house in which it originated. If after reconsideration, it again passes on a roll call vote of three-fourths of the membership of each house of the legislature, it shall become law notwithstanding the governor's objection.

C. Meetings of the committee are open to the public except for meetings to interview candidates and to make preliminary choices among the candidates. The meeting held to vote for the nominee is open to the public.

D. The identity of all candidates shall be public.

E. Committee members are eligible to receive reimbursement of expenses pursuant to title 38, chapter 4, article 2 but are not eligible to receive compensation.

§ 41-1374 Qualifications

A person may not serve as ombudsman-citizens aide within one year of the last day the person served as a state elected officer. As minimum qualifications, the ombudsman-citizens aide shall be a resident of this state for at least six months, shall be at least twenty-five years of age and shall have investigatory experience.

§ 41-1375 Ombudsman-citizens aide; term; compensation

A. The office of ombudsman-citizens aide is established.

B. The ombudsman-citizens aide who is appointed and approved under section 41-1373 shall serve full time and shall be a public officer subject to the conflict of interest provisions of title 38, chapter 3, article 8.

C. The term of office of the ombudsman-citizens aide is five years beginning on the date of appointment. Except as provided in subsection D of this section, the ombudsman-citizens aide shall not serve more than three full terms.

D. If the term of the ombudsman-citizens aide expires without the appointment of a successor, the incumbent ombudsman-citizens aide may continue in office until either:

A successor is appointed.
The ombudsman-citizens aide is removed from office pursuant to subsection E of this section.

E. The ombudsman-citizens aide may be removed from office at any time by a concurrent resolution approved by two-thirds of the membership of each house of the legislature, but only for neglect of duty, conviction of improperly divulging confidential information, misconduct or disability. The ombudsman-citizens aide may forfeit the office of ombudsman-citizens aide without legislative action pursuant to section 38-510. If the ombudsman-citizens aide is removed, resigns, dies or becomes incapacitated, a deputy ombudsman may serve as acting ombudsman-citizens aide until a new ombudsman-citizens aide is appointed.

F. The ombudsman-citizens aide is eligible to receive compensation as determined pursuant to section 38-611.

G. The ombudsman-citizens aide may incur, subject to appropriation, expenses that are necessary to carry out the duties under this article.

§ 41-1376 Powers and duties

A. The ombudsman-citizens aide shall:

Investigate the administrative acts of agencies pursuant to section 41-1377, subsections A and B except as provided in section 41-1377, subsections C, D and E. The ombudsman-citizens aide shall investigate the administrative acts of an agency without regard to the finality of the administrative act.
Annually before January 1 prepare a written report to the governor, the legislature and the public that contains a summary of the ombudsman-citizens aide's activities during the previous fiscal year. The ombudsman-citizens aide shall present this report annually before the legislative council and distribute copies of the report to the director of the governor's office of strategic planning and budgeting, the chairperson of the joint legislative budget committee and the cochairpersons of the administrative rules oversight committee. This report shall include:

(a) The ombudsman-citizens aide's mission statement.

(b) The number of matters that were within each of the categories specified in section 41-1379, subsection B.

(d) Selected case studies that illustrate the ombudsman-citizens aide's work and reasons for complaints.

(e) Ombudsman-citizens aide's contact statistics.

(f) A description of the public awareness and outreach activities conducted by the ombudsman-citizens aide.

(g) Ombudsman-citizens aide's staff.

Before conducting the first investigation, adopt rules that ensure that confidential information that is gathered will not be disclosed.
Appoint a deputy ombudsman and prescribe the duties of employees or, subject to appropriation, contract for the services of independent contractors necessary to administer the duties of the office of ombudsman-citizens aide. All staff serves at the pleasure of the ombudsman-citizens aide, and they are exempt from chapter 4, articles 5 and 6 of this title. All staff are subject to the conflict of interest provisions of title 38, chapter 3, article 8.
Before conducting the first investigation, adopt rules that establish procedures for receiving and processing complaints, including guidelines to ensure each complainant has exhausted all reasonable alternatives within the agency, conducting investigations, incorporating agency responses into recommendations and reporting findings.
Notify the chief executive or administrative officer of the agency in writing of the intention to investigate unless notification would unduly hinder the investigation or make the investigation ineffectual.
Appoint an assistant to help the ombudsman-citizens aide investigate complaints relating to the department of child safety. The assistant shall have expertise in the department of child safety procedures and laws. Notwithstanding any law to the contrary, the ombudsman-citizens aide and the assistant have access to the department of child safety records and direct remote access to any automated case management system used by the department of child safety.
On or before December 31 of each year, submit a report to the president of the senate, the speaker of the house of representatives, the minority leader of the senate, the minority leader of the house of representatives, the chairperson of the senate judiciary committee, or its successor committee, and the chairperson of the house of representatives judiciary committee, or its successor committee, that includes the number of complaints made regarding the state department of corrections, the topic of each complaint and how each complaint was resolved.

B. After the conclusion of an investigation and notice to the head of the agency pursuant to section 41-1379, the ombudsman-citizens aide may present the ombudsman-citizens aide's opinion and recommendations to the governor, the legislature, the office of the appropriate prosecutor or the public, or any combination of these persons. The ombudsman-citizens aide shall include in the opinion the reply of the agency, including those issues that were resolved as a result of the ombudsman-citizens aide's preliminary opinion or recommendation.

§ 41-1376.01 Additional powers and duties; definitions

A. In addition to the powers and duties prescribed in section 41-1376, the ombudsman-citizens aide shall appoint one assistant who is an attorney to help the ombudsman-citizens aide investigate complaints relating to public access laws involving an agency and complaints and compliance with reporting requirements pursuant to this article. The assistant shall train public officials and educate the public on the rights of the public and the responsibilities of public agencies under the public access laws. The assistant shall prepare interpretive and educational materials and programs in cooperation with the ombudsman-citizens aide and shall distribute to elected or appointed public officials the public access laws and educational materials concerning the public access laws.

B. The annual report of the ombudsman-citizens aide shall include the following information about public access:

The number of inquiries that are received from the public, the media and government agencies.
The number of inquiries that are received about state agencies, county agencies, city or town agencies, school districts and other local jurisdictions.
The number of requests that are received concerning public records and public meetings.
The number of investigations that are conducted and the results of the investigations.

C. For investigations made pursuant to this section, the ombudsman-citizens aide may:

Make inquiries and obtain information considered necessary subject to the restrictions in section 41-1377.
Enter without notice to inspect agency premises with agency staff on the premises.
Hold hearings.
Notwithstanding any other law, have access to all agency records, including confidential records, except:

(a) Sealed court records without a subpoena.

(b) Active criminal investigation records.

(d) Attorney work product and communications that are protected under attorney-client privilege.

(e) Confidential information as defined in section 42-2001, except as provided in section 42-2003, subsection L.

(f) Information protected by section 6103(d), 6103(p) or 7213 of the internal revenue code.

(g) Confidential information relating to section 36-2903, subsection I, section 36-2917, section 36-2932, subsection F or section 36-2972.

(h) Confidential information relating to sections 36-507, 36-509 and 36-2220.

(i) Documents that are protected by section 214 of the critical infrastructure information act of 2002 (6 United States Code section 133(a)) or by 49 Code of Federal Regulations part 1520.

(j) Information that is protected by section 214 of the critical infrastructure information act of 2002 (6 United States Code section 133(a)) or 49 Code of Federal Regulations part 1520 or critical infrastructure information as defined in section 41-1801 on government owned facilities that are classified as critical infrastructure by the federal government or as defined in section 41-1801.

Issue subpoenas if necessary to compel the attendance and testimony of witnesses and the production of books, records, documents and other evidence to which the ombudsman-citizens aide may have access pursuant to paragraph 4 of this subsection. The ombudsman-citizens aide may only issue a subpoena if the ombudsman-citizens aide has previously requested testimony or evidence and the person or agency to which the request was made has failed to comply with the request in a reasonable amount of time.

D. It is contrary to the public policy of this state for any agency or any individual acting for an agency to take any adverse action against an individual in retaliation because the individual cooperated with or provided information to the ombudsman-citizens aide or the ombudsman-citizens aide's staff.

E. For the purposes of this section:

"Agency" has the same meaning prescribed in section 41-1371 but includes a public body as defined in section 39-121.01, subsection A, paragraph 2.
"Public access laws" means:

(a) Title 39, chapter 1.

(b) Title 38, chapter 3, article 3.1.

§ 41-1377 Scope of investigations

A. On receiving a complaint the ombudsman-citizens aide may investigate administrative acts of agencies that the ombudsman-citizens aide has reason to believe may be:

Contrary to law.
Unreasonable, unfair, oppressive, arbitrary, capricious, an abuse of discretion or unnecessarily discriminatory, even though they may be in accordance with law.
Based on a mistake of fact.
Based on improper or irrelevant grounds.
Unsupported by an adequate statement of reasons.
Performed in an inefficient or discourteous manner.
Otherwise erroneous.

B. On receiving a complaint the ombudsman-citizens aide may investigate to find an appropriate remedy.

C. On receiving a complaint the ombudsman-citizens aide may refuse to investigate an administrative act of an agency that otherwise qualifies for investigation under subsection A of this section if:

There is presently available an adequate remedy for the grievance stated in the complaint.
The complaint relates to a matter that is outside the duties of the ombudsman-citizens aide.
The complaint relates to an administrative act that the complainant has had knowledge of for an unreasonable time period before filing the complaint.
The complainant does not have a sufficient personal interest in the subject matter of the complaint.
The complaint is trivial or made in bad faith.
The resources of the office of ombudsman-citizens aide are insufficient to adequately investigate the complaint.

D. The ombudsman-citizens aide shall refuse to investigate complaints filed by a person in the custody of the state department of corrections.

E. On receiving a complaint that involves confidential information as defined in section 42-2001, the ombudsman-citizens aide shall either:

Work with the department of revenue problem resolution officer or an employee of the department of revenue who is authorized to access confidential taxpayer information.
Obtain a power of attorney from the taxpayer to access confidential information specific to the complainant in a form acceptable to the department of revenue.

F. On receiving a complaint that involves confidential information relating to section 36-2903, subsection I, section 36-2917, section 36-2932, subsection F or section 36-2972, the ombudsman-citizens aide shall either:

Work with the Arizona health care cost containment system administration employee who is authorized to access confidential information.
Obtain a power of attorney from the complainant to access confidential information specific to the complainant in a form acceptable to the Arizona health care cost containment system administration.

G. On receiving a complaint that involves confidential information relating to sections 36-507, 36-509 and 36-2220, the ombudsman-citizens aide shall either:

Work with the department of health services employee who is authorized to access confidential information.
Obtain a power of attorney from the complainant to access confidential information specific to the complainant in a form acceptable to the department of health services.

§ 41-1378 Complaint; investigation; investigative authority; violation; classification

A. All complaints shall be addressed to the ombudsman-citizens aide. If an agency receives correspondence between a complainant and the ombudsman-citizens aide, it shall hold that correspondence in trust and shall promptly forward the correspondence, unopened, to the ombudsman-citizens aide.

B. Within thirty days of receipt of the complaint, the ombudsman-citizens aide shall notify the complainant of the decision to investigate or not to investigate the complaint. If the ombudsman-citizens aide decides not to investigate and if requested by the complainant, the ombudsman-citizens aide shall provide the reasons for not investigating in writing.

C. The ombudsman-citizens aide shall not charge any fees for investigations or complaints.

D. In an investigation, the ombudsman-citizens aide may:

Make inquiries and obtain information considered necessary subject to the restrictions in section 41-1377.
Enter without notice to inspect agency premises with agency staff on the premises.
Hold hearings.
Notwithstanding any other law, have access to all state agency records, including confidential records, except:

(a) Sealed court records without a subpoena.

(b) Active criminal investigation records.

(d) Attorney work product and communications that are protected under the attorney-client privilege.

(e) Confidential information as defined in section 42-2001, except as provided in section 42-2003, subsection L.

(f) Information protected by section 6103(d), 6103(p)(8) or 7213 of the internal revenue code.

(g) Confidential information relating to section 36-2903, subsection I, section 36-2917, section 36-2932, subsection F or section 36-2972.

(h) Confidential information relating to sections 36-507, 36-509 and 36-2220.

Issue subpoenas if necessary to compel the attendance and testimony of witnesses and the production of books, records, documents and other evidence to which the ombudsman-citizens aide may have access pursuant to paragraph 4 of this subsection. The ombudsman-citizens aide may only issue a subpoena if the ombudsman-citizens aide has previously requested testimony or evidence and the person or agency to which the request was made has failed to comply with the request in a reasonable amount of time.

E. It is contrary to the public policy of this state for any state agency or any individual acting for a state agency to take any adverse action against an individual in retaliation because the individual cooperated with or provided information to the ombudsman-citizens aide or the ombudsman-citizens aide's staff.

F. If requested by the complainants or witnesses, the ombudsman-citizens aide shall maintain confidentiality with respect to those matters necessary to protect the identities of the complainants or witnesses. The ombudsman-citizens aide shall ensure that confidential records are not disclosed by either the ombudsman-citizens aide or staff to the ombudsman-citizens aide. The ombudsman-citizens aide shall maintain the confidentiality of an agency record. With respect to requests made pursuant to title 39, chapter 1, article 2 or other requests for information, the ombudsman-citizens aide shall maintain all records that are received from a custodial agency in the same manner as the custodial agency would if it had received the request.

G. The ombudsman-citizens aide or any staff member or other employee of the ombudsman-citizens aide who knowingly divulges or makes known in any manner not permitted by law any particulars of any record, document or information for which the law restricts disclosure is guilty of a class 5 felony.

§ 41-1379 Procedures after an investigation

A. If an opinion or recommendation of the ombudsman-citizens aide is critical of a person or agency, the ombudsman-citizens aide shall first consult with the person or agency before rendering the opinion or recommendation. A preliminary opinion or preliminary recommendation is confidential and shall not be publicly disclosed by any party.

B. The ombudsman-citizens aide shall report the ombudsman-citizens aide's opinion and recommendations to an agency, if the ombudsman-citizens aide finds, after investigation, that:

A matter should be further considered by that agency.
A matter should be referred to the presiding officers of both houses of the legislature for further investigation or legislative action.
A statute or rule on which an administrative act is based should be amended.
An administrative act should be modified or cancelled.
Reasons should be given for an administrative act.
There are no grounds or there are insufficient grounds for action by the agency.
Any other action should be taken by the agency.
The agency's action was arbitrary or capricious, constituted an abuse of discretion or was not according to law.

C. The ombudsman-citizens aide may request the agency to notify the office within a specified time of any action taken on his recommendations.

D. The ombudsman-citizens aide shall notify the complainant of the ombudsman-citizens aide's recommendations and the actions taken by the agency.

E. If the ombudsman-citizens aide believes there is a breach of duty or misconduct by an officer or employee of an agency in the conduct of the officer's or employee's duty, the ombudsman-citizens aide shall refer the matter to the chief executive officer of the agency, to the presiding officer of both houses of the legislature, to a prosecutor's office or to another appropriate official or agency.

§ 41-1380 Ombudsman-citizens aide protections

A. A civil action may not be brought against the ombudsman-citizens aide or the staff of the ombudsman-citizens aide for any action or omission in performing the duties under this article except for gross negligence or intentional wrongful acts or omissions except as provided in title 38, chapter 3, article 8.

B. A proceeding or decision of the ombudsman-citizens aide may be reviewed in superior court only to determine if it is contrary to this article.

C. The ombudsman-citizens aide and the staff of the ombudsman-citizens aide shall not be required to testify in court regarding matters that come to their attention in the exercise of their duties except as may be necessary to enforce this article.

D. Records and files maintained by the ombudsman-citizens aide are not public records and are exempt from title 39, chapter 1. The information contained in these records and files that were prepared pursuant to an investigation conducted under this article are not subject to disclosure except to the attorney general or any county attorney in connection with an investigation that has been referred to the attorney general or a county attorney pursuant to section 41-1379. For the purposes of this subsection, "records and files" means all information the department of child safety and the office of the ombudsman-citizens aide gather during the course of a department of child safety investigation conducted under this article from the time a file is opened until it is closed. Records and files do not include information that is contained in child welfare agency licensing records.

§ 41-1381 Ombudsman-citizens aide political activity

The ombudsman-citizens aide and the staff of the ombudsman-citizens aide may express a private opinion, may register to vote as to party and may vote but may not engage in any other political activity. If the ombudsman-citizens aide or any staff member or employee of the ombudsman-citizens aide becomes a candidate for political office, that person shall resign.

§ 41-1383 Violation; classification

A person who knowingly hinders the lawful actions of the ombudsman-citizens aide or the staff of the ombudsman-citizens aide or who knowingly refuses to comply with their lawful demands is guilty of a class 1 misdemeanor.

Chapter 9 Civil Rights

Article 1 Civil Rights Division and Civil Rights Advisory Board

§ 41-1401 Civil rights division; advisory board; terms; vacancies; organization; quorum; compensation; definitions

A. There is created the civil rights division within the department of law which shall include the Arizona civil rights advisory board. The board shall be composed of seven members who shall be appointed by the governor. Not more than four of the members shall at any one time be of the same political party. Each member shall serve for a term of three years. Of the members of the board first appointed, two shall be appointed for terms ending January 31, 1966, two for terms ending January 31, 1967, and three for terms ending January 31, 1968. Thereafter, the terms shall expire on the third Monday in January of the appropriate year.

B. An appointment to fill a vacancy shall be subject to the same limitation with respect to party affiliations as the original appointment.

C. The board shall elect from its membership a chairman and vice chairman. The vice chairman shall act as chairman in the absence or disability of the chairman, or in the event of a vacancy in that office.

D. Four members of the board shall constitute a quorum, except that if the chairman appoints a subcommittee of the board a majority of the members of the subcommittee shall constitute a quorum. The concurrence of four of the members when in session as a board shall be the act of the board.

E. Each member shall receive compensation as determined pursuant to section 38-611 for each day in which he participates in meetings, but not to exceed one thousand dollars in any fiscal year.

F. For the purposes of this chapter, "board" means the Arizona civil rights advisory board and "division" means the civil rights division within the department of law.

§ 41-1402 Powers and duties of the division

A. The division may:

Employ an executive director for the board and other necessary personnel whose compensation shall be as determined pursuant to section 38-611.
Subject to the provisions and restrictions of this chapter, cooperate with and enter into agreements with the United States equal employment opportunity commission, the United States department of housing and urban development and other United States agencies interested in practices governed by this chapter, accept monies from those agencies and carry out and perform the covenants and conditions of any written agreement with those agencies not inconsistent with or beyond this chapter.
Cooperate with and enter into agreements with state and local agencies not inconsistent with or beyond this chapter.
Intervene in a civil action brought under section 41-1481 by a complainant against a defendant other than the state.
After studying recommendations of the board, issue, amend or rescind procedural rules to carry out this chapter.
Make periodic surveys of the existence and effect of discrimination because of race, color, religion, sex, age, disability, familial status or national origin in the enjoyment of civil rights by any person within this state as prescribed by this chapter.
Foster, through community effort, in cooperation with both public and private groups, the elimination of discrimination based on race, color, religion, sex, age, disability, familial status or national origin.
Issue publications of results of studies, investigations and research as in its judgment will tend to promote goodwill and the elimination of discrimination between persons because of race, color, religion, sex, age, disability, familial status or national origin.
Furnish persons subject to this chapter with such assistance as may be reasonably necessary to further compliance with this chapter.

B. The division shall:

Administer this chapter.
Report from time to time, but not less than once a year in December, to the legislature and the governor, describing its activities and accomplishments during the year, and file with each report a copy of all recommendations of the division as to additional remedial action by legislative enactment or otherwise.

§ 41-1403 Right to examine and copy evidence; summoning witnesses and documents and taking testimony; right to counsel; court aid; process; service and return; fees of witnesses

A. In connection with the investigation of a charge filed under this chapter, the division or its duly authorized employees shall at all reasonable times have access to, for the purpose of examination, and have the right to copy any evidence of any person being investigated, if the evidence relates to unlawful practices covered by this chapter and is relevant to the charge under investigation.

B. For the purpose of all hearings and investigations conducted by the board or division:

The division, on its own initiative, or on application of any party to the proceeding, may issue subpoenas compelling the attendance and testimony of witnesses or requiring the production for examination or copying of documents if the evidence relates to unlawful practices covered by this chapter and is relevant to the charge that is the subject matter of the hearing or investigation. Within fourteen days after the service of a subpoena on any person requiring the production of any evidence in the person's possession or under the person's control, the person may petition the division to revoke, limit or modify the subpoena. The division shall revoke, limit or modify the subpoena if in its opinion the evidence required does not relate to unlawful practices covered by this chapter, is not relevant to the charge that is the subject matter of the hearing or investigation, does not describe with sufficient particularity the evidence whose production is required, or is unduly burdensome or oppressive. Any member of the division, or any agent designated by the division may administer oaths or affirmations, examine witnesses and receive the evidence.
Any person appearing before the division or the board has the right to be represented by counsel.
The superior court, on application by the division or by the person subpoenaed, has jurisdiction to issue an order requiring the person to appear before the division, the board or the duly authorized agent of either, there to produce evidence relating to the matter under investigation if so ordered, or revoking, limiting or modifying the subpoena or conditioning issuance of the subpoena on payment of costs or expenses incurred to comply with the subpoena if in the court's opinion the evidence required does not relate to unlawful practices covered by this chapter, is not relevant to the charge that is the subject matter of the hearing or investigation, does not describe with sufficient particularity the evidence whose production is required or is unduly burdensome or oppressive. Any failure to obey the order of the court may be punished by the court as a contempt.
Charges, orders and other process and papers of the division, the board, or the agent of either, may be served either personally or by registered mail. The verified return by the individual so serving the same, setting forth the manner of the service, shall be proof of service. The return post office receipt when registered and mailed as provided in this paragraph shall be proof of service. Witnesses subpoenaed shall be paid the same fees and mileage that are paid witnesses in the superior court and witnesses whose depositions are taken and the persons taking the same shall be entitled to the same fees as are paid for like service in the superior court.

§ 41-1404 Claims of no disability

This chapter does not provide any basis for a claim by an individual without a disability that the individual was subject to discrimination because of the individual's lack of disability.

§ 41-1405 Reasonable accommodation or reasonable modification not required under certain conditions

A covered entity under article 4 or 8 of this chapter is not required to provide a reasonable accommodation or a reasonable modification to policies, practices or procedures to an individual who meets the definition of disability solely under section 41-1461, paragraph 5, subdivision (c) or who meets the definition of being regarded as having such a physical or mental impairment under section 41-1492.

Article 2 Voting Rights

§ 41-1421 Voting rights; definitions

A. A citizen of the United States who is a resident of this state, who is qualified to become an elector as prescribed by the terms of section 16-101 and who is otherwise qualified by law to vote at any election by or in this state or any county, city, town, school district or other political subdivision of this state is entitled to and shall be allowed to vote at those elections without discrimination because of race, color, religion, sex, ancestry or national origin.

B. A qualified individual with a disability shall not be excluded from voting or be discriminated in voting under this section by reason of the disability.

C. This state or any county, city, town, school district or other political subdivision of this state that makes reasonable modifications to rules, policies or practices, removes architectural and communication barriers and provides auxiliary aids and services to persons with disabilities has complied with this article.

D. Compliance with title II of the Americans with disabilities act (42 United States Code sections 12131 through 12134) and its implementing regulations and the voter accessibility for the elderly and the handicapped act (42 United States Code sections 1977ee through 1977ee-6) is deemed in compliance with this article.

E. For the purposes of this section:

"Disability" means, with respect to an individual, any of the following:

(a) A physical or mental impairment that substantially limits one or more of the major life activities of the individual.

(b) A record of such a physical or mental impairment.

"Qualified individual with a disability" means an individual with a disability who, with or without reasonable modifications to rules, policies or practices, the removal of architectural and communication barriers or the provision of auxiliary aids and services, meets the eligibility requirements prescribed in subsection A of this section.

Article 3 Public Accommodations

§ 41-1441 Definitions

In this article, unless the context otherwise requires:

"Person" means an individual, corporation, partnership, unincorporated association, or other organization, and includes the owner, lessee, operator, proprietor, manager, superintendent, agent, or employee of any place of public accommodation.
"Places of public accommodation" means all public places of entertainment, amusement or recreation, all public places where food or beverages are sold for consumption on the premises, all public places which are conducted for the lodging of transients or for the benefit, use or accommodation of those seeking health or recreation and all establishments which cater or offer their services, facilities or goods to or solicit patronage from the members of the general public. Any dwelling as defined in section 41-1491, or any private club, or any place which is in its nature distinctly private is not a place of public accommodation.

§ 41-1442 Discrimination in places of public accommodation; exceptions

A. Discrimination in places of public accommodation against any person because of race, color, religion, sex, national origin or ancestry is contrary to the policy of this state and shall be deemed unlawful.

B. No person, directly or indirectly, shall refuse to, withhold from or deny to any person, nor aid in or incite the refusal to deny or withhold, accommodations, advantages, facilities or privileges thereof because of race, color, religion, sex, national origin or ancestry, nor shall distinction be made with respect to any person based on race, color, religion, sex, national origin or ancestry in connection with the price or quality of any item, goods or services offered by or at any place of public accommodation.

C. Any person who is under the influence of alcohol or narcotics, who is guilty of boisterous conduct, who is of lewd or immoral character, who is physically violent or who violates any regulation of any place of public accommodation that applies to all persons regardless of race, color, religion, sex, national origin or ancestry may be excluded from any place of public accommodation and nothing in this article shall be considered to limit the right of such exclusion.

D. Notwithstanding any other provision of this article and except as required by federal law, it is not an unlawful practice if a person fails to provide a trained and competent bilingual person who is skilled in interpreting a language other than English to assist a person who is seeking services at a place of public accommodation. Notwithstanding any other provision of this article and except as required by federal law, a person who offers a service at a place of public accommodation is not required to provide a person who is seeking the service any form or other documentation in that person's native language.

E. It is not an unlawful practice pursuant to this section for a person to fail to provide service at a place of public accommodation if by providing the service the person offering the service would violate a state or federal law or a rule that is adopted by a state or federal board, commission or agency that has jurisdiction over the person offering the service.

§ 41-1443 Breast-feeding; public place; public accommodation

A mother is entitled to breast-feed in any area of a public place or a place of public accommodation where the mother is otherwise lawfully present.

§ 41-1444 Changing stations; public buildings; definitions

A. A public entity that constructs a new restroom that is accessible to the public in a public building or that totally renovates an existing restroom that is accessible to both men and women and to the public in a public building shall:

Include in at least one restroom in each building at least one changing station that is capable of serving both a baby and an adult and that is accessible to both men and women.
Provide signage at or near the entrance to the changing station indicating the location of the changing station.
Indicate the location of the changing station in the central building directory, if such a directory exists.

B. The responsible authority may grant an exemption from the requirements of this section if the responsible authority determines that:

Any of the following would apply to the installation of a changing station that is capable of serving both a baby and an adult:

(a) The installation would not be feasible.

(b) The installation would result in a failure to comply with the Americans with disabilities act standards for access for persons with disabilities.

The public building is not frequented by the public.

C. The installation of a changing station under this section must provide sufficient clear floor space to comply with the requirements of the 2010 Americans with disabilities act standards for accessible design.

D. This section does not establish a private right of action.

E. For the purposes of this section:

"Public building" means a building or appurtenance to a building that is built in whole or in part with public monies.
"Public entity" means any:

(a) State or local government.

(b) Department, agency, special purpose district or other instrumentality of a state or local government, including the legislature.

"Responsible authority" means an organization, office or individual responsible for enforcing the requirements of a code or standard or for approving equipment, materials, an installation or a procedure.
"Totally renovates" means to perform construction that is at least $50,000 and that totally removes all nonstructural interior walls, floor and ceiling finishes, mechanical systems, electrical systems and plumbing fixtures and supply and waste lines.
"2010 Americans with disabilities act standards for accessible design" means the 2010 standards for state and local government facilities prescribed in 28 Code of Federal Regulations section 35.151 and 36 Code of Federal Regulations part 1191, appendices B and D.

Article 4 Discrimination in Employment

§ 41-1461 Definitions

In this article, unless the context otherwise requires:

"Auxiliary aids and services" includes:

(a) Qualified interpreters or other effective methods of making aurally delivered materials available to individuals with hearing impairments.

(b) Qualified readers, taped texts or other effective methods of making visually delivered materials available to individuals with visual impairments.

(d) Other similar services and actions.

"Because of sex" and "on the basis of sex" includes because of or on the basis of pregnancy or childbirth or related medical conditions.
"Being regarded as having such a physical or mental impairment":

(a) Means an individual who establishes that the individual has been subjected to an action prohibited under this article because of an actual or perceived physical or mental impairment whether or not the impairment limits or is perceived to limit a major life activity.

(b) Does not mean an impairment that is transitory and minor. For the purposes of this subdivision, "transitory impairment" means an impairment with an actual or expected duration of six months or less.

"Covered entity" means an employer, employment agency, labor organization or joint labor-management committee.
"Disability" means, with respect to an individual, except any impairment caused by current use of illegal drugs, any of the following:

(a) A physical or mental impairment that substantially limits one or more of the major life activities of the individual.

(b) A record of such a physical or mental impairment.

"Employee":

(a) Means an individual employed by an employer.

(b) Does not include an elected public official of this state or any political subdivision of this state, any person chosen by an elected official to be on the elected official's personal staff, an appointee on the policymaking level or an immediate adviser with respect to the exercise of the constitutional or legal powers of the office, unless the person or appointee is subject to the civil service laws of this state or any political subdivision of this state.

"Employer":

(a) Means a person who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year and any agent of that person or a person who has one or more employees in the current or preceding calendar year and any agent of that person, to the extent that the person is alleged to have:

(i) Committed any act of sexual harassment.

(ii) Discriminated against anyone for opposing sexual harassment or making a charge, testifying, assisting or participating in any manner in an investigation, proceeding or hearing arising from sexual harassment.

(b) Does not include either:

(i) The United States or any department or agency of the United States, a corporation wholly owned by the government of the United States or an Indian tribe.

(ii) A bona fide private membership club, other than a labor organization, that is exempt from taxation under section 501(c) of the internal revenue code of 1954.

"Employment agency" means any person regularly undertaking with or without compensation to procure employees for an employer or to procure for employees opportunities to work for an employer and includes an agent of that person.
"Labor organization":

(a) Means a labor organization and any agent of a labor organization.

(b) Includes:

(i) Any organization of any kind, any agency or employee representation committee, group, association or plan in which fifteen or more employees participate and that exists for the purpose, in whole or in part, of dealing with employers concerning grievances, labor disputes, wages, rates of pay, hours or other terms or conditions of employment.

(ii) Any conference, general committee, joint or system board or joint council that is subordinate to a national or international labor organization.

"Major life activities" includes:

(a) Caring for oneself, performing manual tasks, seeing, hearing, eating, sleeping, walking, standing, lifting, bending, speaking, breathing, learning, reading, concentrating, thinking, communicating and working.

(b) The operation of a major bodily function, including functions of the immune system, normal cell growth and digestive, bowel, bladder, neurological, brain, respiratory, circulatory, endocrine and reproductive functions.

"Person" means one or more individuals, governmental agencies, political subdivisions, labor unions, partnerships, associations, corporations, legal representatives, mutual companies, joint-stock companies, trusts, unincorporated organizations, trustees, trustees in bankruptcy or receivers.
"Qualified individual" means a person with a disability who, with or without reasonable accommodation, is capable of performing the essential functions of the employment position that the individual holds or desires.
"Reasonable accommodation" includes:

(a) Making existing facilities used by employees readily accessible to and usable by individuals with disabilities.

(b) Job restructuring, part-time or modified work schedules, reassignment to a vacant position, acquisition or modification of equipment or devices, appropriate adjustment or modification of examinations, training materials or policies, the provision of qualified readers, taped texts or other effective methods of making visually delivered materials available to individuals with visual impairments, the provision of auxiliary aids and services or interpreters and other similar services and actions for individuals with disabilities.

"Religion" means all aspects of religious observance and practice, as well as belief. Unlawful practices as prohibited by this article include practices with respect to religion unless an employer demonstrates that the employer is unable to reasonably accommodate an employee's or prospective employee's religious observance or practice without undue hardship on the conduct of the employer's business.
"Undue hardship":

(a) Means an action requiring significant difficulty or expense when considered in light of the factors set forth in subdivision (b) of this paragraph.

(b) When determining whether an accommodation would impose an undue hardship on a covered entity, factors to be considered include:

(i) The nature and cost of the accommodations needed under this article.

(ii) The overall financial resources of the facility or facilities involved in the provision of the reasonable accommodation, the number of persons employed at the facility, the effect on expenses and resources of the facility and any other impact of the accommodation on the operation of the facility.

(iii) The overall financial resources of the covered entity, the overall size of the business of the covered entity with respect to the number of its employees and the number, type and location of its facilities.

(iv) The type of operation or operations of the covered entity, including the composition, structure and functions of the workforce of the covered entity.

(v) The geographic separateness and the administrative or fiscal relationship of the facility to the covered entity.

§ 41-1462 Exemption; nonresident aliens, religious institutions

This article does not apply to an employer with respect to the employment of aliens outside any state or to a religious corporation, association, educational institution or society with respect to the employment of individuals of a particular religion to perform work connected with the carrying on by such corporation, association, educational institution or society of its activities.

§ 41-1463 Discrimination; unlawful practices; definition

A. Nothing contained in this article shall be interpreted to require that the less qualified be preferred over the better qualified simply because of race, color, religion, sex, age or national origin or on the basis of disability.

B. It is an unlawful employment practice for an employer:

To fail or refuse to hire or to discharge any individual or otherwise to discriminate against any individual with respect to the individual's compensation, terms, conditions or privileges of employment because of the individual's race, color, religion, sex, age or national origin or on the basis of disability.
To limit, segregate or classify employees or applicants for employment in any way that would deprive or tend to deprive any individual of employment opportunities or otherwise adversely affect the individual's status as an employee, because of the individual's race, color, religion, sex, age or national origin or on the basis of disability.
To fail or refuse to hire, to discharge or to otherwise discriminate against any individual based on the results of a genetic test received by the employer, notwithstanding subsection J, paragraph 2 of this section.

C. It is an unlawful employment practice for an employment agency to fail or refuse to refer for employment or otherwise to discriminate against any individual because of the individual's race, color, religion, sex, age or national origin or on the basis of disability or to classify or refer for employment any individual on the basis of the individual's race, color, religion, sex, age or national origin or on the basis of disability.

D. It is an unlawful employment practice for a labor organization:

To exclude or to expel from its membership or otherwise to discriminate against any individual because of the individual's race, color, religion, sex, age or national origin or on the basis of disability.
To limit, segregate or classify its membership or applicants for membership or to classify or fail or refuse to refer for employment any individual in any way that would deprive or tend to deprive the individual of employment opportunities or would limit those employment opportunities or otherwise adversely affect the individual's status as an employee or as an applicant for employment because of the individual's race, color, religion, sex, age or national origin or on the basis of disability.
To cause or attempt to cause an employer to discriminate against an individual in violation of this section.

E. It is an unlawful employment practice for any employer, labor organization or joint labor-management committee controlling apprenticeship or other training or retraining programs, including on-the-job training programs, to discriminate against any individual because of the individual's race, color, religion, sex, age or national origin or on the basis of disability in admission to or employment in any program established to provide apprenticeship or other training and, if the individual is an otherwise qualified individual, to fail or refuse to reasonably accommodate the individual's disability.

F. With respect to a qualified individual, it is an unlawful employment practice for a covered entity to:

Participate in any contractual or other arrangement or relationship that has the effect of subjecting a qualified individual who applies with or who is employed by the covered entity to unlawful employment discrimination on the basis of disability.
Use standards, criteria or methods of administration that have the effect of discriminating on the basis of disability or that perpetuate the discrimination of others who are subject to common administrative control.
Exclude or otherwise deny equal jobs or benefits to an individual qualified for the job or benefits because of the known disability of an individual with whom the individual qualified for the job or benefits is known to have a relationship or association.
Not make reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual who is an applicant or employee unless the covered entity can demonstrate that the accommodation would impose an undue hardship on the operation of the business of the covered entity or the individual only meets the definition of disability as prescribed in section 41-1461, paragraph 5, subdivision (c).
Deny employment opportunities to a job applicant or employee who is an otherwise qualified individual if the denial is based on the need of the covered entity to make reasonable accommodation to the physical or mental impairment of the applicant or employee.
Use qualification standards, employment tests or other selection criteria, including those based on an individual's uncorrected vision, that screen out or tend to screen out an individual with a disability or a class of individuals with disabilities, unless the standard, test or other selection criteria, as used by the covered entity, is shown to be job related for the position in question and is consistent with business necessity.
Fail to select and administer tests relating to employment in the most effective manner to ensure that, when the test is administered to a job applicant or employee who has a disability that impairs sensory, manual or speaking skills, the test results accurately reflect the skills or aptitude or whatever other factor of the applicant or employee that the test purports to measure, rather than reflecting the impaired sensory, manual or speaking skills of the applicant or employee, except if the skills are the factors that the test purports to measure.

G. Women who are affected by pregnancy or childbirth or related medical conditions shall be treated the same for all employment-related purposes, including receipt of benefits under fringe benefit programs, as other persons not so affected but similar in their ability or inability to work, and subsection J, paragraph 3 of this section may not be interpreted to allow otherwise.

H. Notwithstanding any other provision of this article, it is not an unlawful employment practice:

For an employer to hire and employ employees, for an employment agency to classify or refer for employment any individual, for a labor organization to classify its membership or classify or refer for employment any individual or for an employer, labor organization or joint labor-management committee controlling apprenticeship or other training or retraining programs to admit or employ any individual in any such program, on the basis of the individual's religion, sex or national origin in those certain instances when religion, sex or national origin is a bona fide occupational qualification reasonably necessary to the normal operation of that particular business or enterprise.
For any school, college, university or other educational institution or institution of learning to hire and employ employees of a particular religion if the school, college, university or other educational institution or institution of learning is in whole or in substantial part owned, supported, controlled or managed by a particular religion or religious corporation, association or society, or if the curriculum of the school, college, university or other educational institution or institution of learning is directed toward the propagation of a particular religion.
For an employer to fail or refuse to hire or employ any individual for any position, for an employment agency to fail or refuse to refer any individual for employment in any position or for a labor organization to fail or refuse to refer any individual for employment in any position, if both of the following apply:

(a) The occupancy of the position or access to the premises in or on which any part of the duties of the position are performed or are to be performed is subject to any requirement imposed in the interest of the national security of the United States under any security program in effect pursuant to or administered under any statute of the United States or any executive order of the president of the United States.

(b) The individual has not fulfilled or has ceased to fulfill that requirement.

With respect to age, for an employer, employment agency or labor organization:

(a) To take any action otherwise prohibited under subsection B, C or D of this section if age is a bona fide occupational qualification reasonably necessary to the normal operation of the particular business or if the differentiation is based on reasonable factors other than age.

(b) To observe the terms of a bona fide seniority system or any bona fide employee benefit plan such as a retirement, pension, deferred compensation or insurance plan, which is not a subterfuge to evade the purposes of the age discrimination provisions of this article, except that no employee benefit plan may excuse the failure to hire any individual and no seniority system or employee benefit plan may require or allow the involuntary retirement of any individual specified by section 41-1465 because of the individual's age.

I. For the purposes of this article, unlawful employment practice does not include any action or measure taken by an employer, labor organization, joint labor-management committee or employment agency with respect to an individual who is a member of the communist party of the United States or of any other organization required to register as a communist-action or communist-front organization by final order of the subversive activities control board pursuant to the subversive activities control act of 1950.

J. Notwithstanding any other provision of this article, it is not an unlawful employment practice:

For an employer to apply different standards of compensation or different terms, conditions or privileges of employment pursuant to a bona fide seniority or merit system or a system that measures earnings by quantity or quality of production or to employees who work in different locations, if these differences are not the result of an intention to discriminate because of race, color, religion, sex or national origin.
For an employer to give and act on the results of any professionally developed ability test if the test, its administration or action on the results is not designed, intended or used to discriminate because of race, color, religion, sex or national origin.
For any employer to differentiate on the basis of sex or disability in determining the amount of the wages or compensation paid or to be paid to employees of the employer if the differentiation is authorized by the provisions of section 6(d) or section 14 of the fair labor standards act of 1938, as amended (29 United States Code section 206(d)).

K. Nothing contained in this chapter applies to any business or enterprise on or near an Indian reservation with respect to any publicly announced employment practice of the business or enterprise under which a preferential treatment is given to any individual because the individual is an Indian living on or near a reservation.

L. Nothing contained in this article or article 6 of this chapter requires any employer, employment agency, labor organization or joint labor-management committee subject to this article to grant preferential treatment to any individual or group because of the race, color, religion, sex or national origin of the individual or group on account of an imbalance that may exist with respect to the total number or percentage of persons of any race, color, religion, sex or national origin employed by any employer, referred or classified for employment by any employment agency or labor organization, admitted to membership or classified by any labor organization or admitted to or employed in any apprenticeship or other training program, in comparison with the total number or percentage of persons of that race, color, religion, sex or national origin in any community, state, section or other area, or in the available workforce in any community, state, section or other area.

M. The age discrimination prohibitions of this article may not be construed to prohibit compulsory retirement of any employee who has attained sixty-five years of age and who, for the two year period immediately before retirement, is employed in a bona fide executive or high policymaking position, if the employee is entitled to an immediate nonforfeitable annual retirement benefit from a pension, profit sharing, savings or deferred compensation plan or any combination of plans of the employer for the employee, that equals, in the aggregate, at least $44,000. In applying the retirement benefit test of this subsection, if any retirement benefit is in a form other than a straight life annuity, with no ancillary benefits, or if employees contribute to the plan or make rollover contributions, the benefit shall be adjusted in accordance with rules adopted by the division so the benefit is the equivalent of a straight life annuity, with no ancillary benefits, under a plan to which employees do not contribute and under which no rollover contributions are made.

N. A covered entity may require that an individual with a disability shall not pose a direct threat to the health or safety of other individuals in the workplace. For the purposes of this subsection, "direct threat" means a significant risk to the health or safety of others that cannot be eliminated by reasonable accommodation.

O. This article does not alter the standards for determining eligibility for benefits under this state's workers' compensation laws or under state and federal disability benefit programs.

P. For the purposes of this section and section 41-1481, with respect to employers or employment practices involving a disability, "individual" means a qualified individual.

§ 41-1464 Other unlawful employment practices; opposition to unlawful practices; filing of charges; participation in proceedings; notices and advertisements for employment

A. It is an unlawful employment practice for an employer to discriminate against any of the employer's employees or applicants for employment, for an employment agency or joint labor-management committee controlling apprenticeship or other training or retraining programs, including on-the-job training programs, to discriminate against any individual or for a labor organization to discriminate against any member or applicant for membership because the employee, the member, the applicant or the individual in an apprenticeship or other training or retraining program has opposed any practice that is an unlawful employment practice under this article or has made a charge, testified, assisted or participated in any manner in an investigation, proceeding or hearing under article 6 of this chapter.

B. It is an unlawful employment practice for an employer, labor organization, employment agency or joint labor-management committee controlling apprenticeship or other training or retraining programs, including on-the-job training programs, to print or publish or cause to be printed or published any notice or advertisement relating to employment by an employer or membership in or any classification or referral for employment by a labor organization or relating to any classification or referral for employment by an employment agency or relating to admission or to employment in any program established to provide apprenticeship or other training by a joint labor-management committee indicating any preference, limitation, specification or discrimination based on race, color, religion, sex or national origin, except that a notice or advertisement may indicate a preference, limitation, specification or discrimination based on religion, sex or national origin when religion, sex or national origin is a bona fide occupational qualification for employment.

C. It is unlawful for an employer, labor organization or employment agency to print or publish or cause to be printed or published any notice or advertisement relating to employment by an employer or membership in or any classification or referral for employment by a labor organization or relating to any classification or referral for employment by an employment agency, indicating any preference, limitation, specification or discrimination based on age, except that the notice or advertisement may indicate a preference, limitation, specification or discrimination based on age when age is a bona fide occupational qualification for employment.

§ 41-1465 Age discrimination; affected individuals

The age discrimination prohibitions in this article are limited to individuals who are at least forty years of age.

§ 41-1466 Medical examinations and inquiries; exception

A. The prohibition against discrimination based on a disability includes medical examinations and inquiries. Except as provided in subsection B, paragraph 2, a covered entity shall not conduct a medical examination or make inquiries of a job applicant as to whether the applicant is an individual with a disability or as to the nature or severity of the disability.

B. A covered entity may:

Make preemployment inquiries into the ability of an applicant to perform job related functions.
Require a medical examination after an offer of employment has been made to a job applicant and before commencement of employment duties of the applicant and may condition an offer of employment on the results of such examination if all of the following apply:

(a) All entering employees are subjected to the examination regardless of disability.

(b) Information obtained regarding the medical condition or history of the applicant is collected and maintained on separate forms and in separate medical files and is treated as a confidential medical record, except that the covered entity:

(i) May inform supervisors and managers of necessary restrictions on the work or duties of the employee and necessary accommodations.

(ii) When appropriate, may inform first aid and safety personnel if the disability might require emergency treatment.

(iii) On request, shall provide relevant information to government officials investigating compliance with this article.

C. A covered entity shall not require a medical examination and shall not make inquiries of an employee as to whether the employee is an individual with a disability or as to the nature or severity of the disability, unless the examination or inquiry is shown to be job related and consistent with business necessity.

D. A covered entity may:

Conduct voluntary medical examinations, including voluntary medical histories, that are part of an employee health program available to employees at that work site.
Make inquiries into the ability of an employee to perform job related functions.

E. Information obtained pursuant to subsections C and D regarding the medical condition or history of any employee are subject to the requirements prescribed in subsection B, paragraph 2, subdivisions (b) and (c).

F. For the purposes of this section, a test to determine the illegal use of drugs is not a medical examination.

§ 41-1467 Essential job functions

Under this article and article 6 of this chapter, in determining what functions of a job are essential, consideration shall be given to the employer's judgment as to what functions of the job are essential, and if the employer has prepared a written description of the job before advertising or interviewing applicants for the job, this written description is evidence of the essential functions of the job.

§ 41-1468 Interpretation of disability and substantially limits; definitions

A. A person shall define and construe a disability in favor of broad coverage of individuals under this article to the maximum extent permitted by the terms of this article.

B. A person shall interpret substantially limits consistently with the findings and purposes of the ADA amendments act of 2008 (P.L. 110-325; 122 Stat. 3553).

C. An impairment that substantially limits one major life activity need not limit other major life activities in order to be considered a disability.

D. An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.

E. The determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures such as:

Medication, medical supplies, equipment or appliances, low-vision devices, excluding ordinary eyeglasses or contact lenses, prosthetics, including limbs and devices, hearing aids and cochlear implants or other implantable hearing devices, mobility devices or oxygen therapy equipment and supplies.
Use of assistive technology.
Reasonable accommodations or auxiliary aids or services.
Learned behavioral or adaptive neurological modifications.

F. The ameliorative effects of the mitigating measures of ordinary eyeglasses or contact lenses shall be considered in determining whether an impairment substantially limits a major life activity.

G. For the purposes of this section:

"Low-vision devices" means devices that magnify, enhance or otherwise augment a visual image.
"Ordinary eyeglasses or contact lenses" means lenses that are intended to fully correct visual acuity or eliminate refractive error.

Article 5 Enforcement Procedures for Discrimination in Voting Rights or Public Accommodations

§ 41-1471 Charge by person aggrieved; investigation; conciliation agreement; civil action; temporary relief

A. Any person, referred to as the charging party, claiming to be aggrieved by an alleged discriminatory practice or act contrary to article 2 or 3 of this chapter may, within one hundred eighty days from the date of the alleged practice or act, file with the division a verified charge in writing. The verified charge shall state the name and address of the person or persons, referred to as respondent, alleged to have committed the practice or act complained of, the particulars of the alleged discrimination and other information required by the division. After a charge is filed and found to be in proper order, the division shall make an investigation of the allegations contained in the charge. On its own initiative, the division may file a charge to investigate an alleged discriminatory practice or act.

B. If, upon investigation, the division determines that no unlawful discriminatory practice or act has occurred, the division shall notify the charging party and the respondent in writing of this fact and the charging party may within thirty days thereafter file a complaint with the superior court in the county where the alleged discriminatory practice or act occurred.

C. If, after an investigation, the division determines that there is reasonable cause to believe that the charge is true, the division shall enter an order containing its findings of fact and shall endeavor to eliminate the alleged unlawful practice by informal methods of conference, conciliation and persuasion. Nothing said or done during and as part of the informal endeavors may be made public by the division or its officers or employees or used as evidence in a subsequent proceeding without the written consent of the persons concerned.

D. If, within thirty days after the division makes a determination that reasonable cause exists to believe that the charge is true, the division has not accepted a conciliation agreement to which the charging party and the respondent are parties, the division may bring a civil action against the respondent. If the attorney general finds reasonable cause to believe that a party has breached a conciliation agreement, the attorney general may file a civil action for enforcement of the agreement. A charging party may file its own civil action against the respondent within thirty days after the division has issued its determination or may intervene in any civil action brought by the attorney general.

E. If the division concludes at any time after the filing of a charge that prompt judicial action is necessary to carry out the purposes of article 2 or 3 of this chapter, the division may file a civil action for appropriate temporary or preliminary relief pending final disposition of the charge. Any temporary restraining order or other order granting preliminary or temporary relief shall be issued in accordance with the supreme court rules of civil procedure. The court having jurisdiction over the proceedings shall assign the action for hearing at the earliest practicable date and shall cause the action to be expedited in every way.

§ 41-1472 Damages; preventive relief; civil penalties; attorney fees

A. In an action under section 41-1471, if the superior court finds that discrimination in violation of section 41-1421 or 41-1442 has occurred, the court may award:

Actual and compensatory damages, including damages for emotional distress.
Court costs.
Preventive relief, including a permanent or temporary injunction, a restraining order or any other order against the person responsible for a violation of section 41-1421 or 41-1442.

B. In an action brought by the attorney general, if the superior court finds that discrimination in violation of section 41-1421 or 41-1442 has occurred, the court may award:

Actual and compensatory damages, including damages for emotional distress.
Court costs.
Preventive relief, including a permanent or temporary injunction, a restraining order or any other order against the person responsible for a violation of section 41-1421 or 41-1442.
If appropriate to vindicate the public interest, a civil penalty against the person responsible for the violation of not more than:

(a) Five thousand dollars for a first violation.

(b) Ten thousand dollars for any subsequent violation.

C. In an action under section 41-1471, the court shall award reasonable attorney fees to a prevailing plaintiff, other than the attorney general. The court shall not award attorney fees to a prevailing defendant unless the plaintiff's complaint was frivolous, unreasonable or without foundation.

Article 6 Enforcement Procedures for Discrimination in Employment

§ 41-1481 Filing charges; investigation; findings; conciliation; compliance proceedings; appeals; attorney fees; violation; classification

A. A charge under this section shall be filed within one hundred eighty days after the alleged unlawful employment practice occurred. A charge is deemed filed on receipt by the division from or on behalf of a person claiming to be aggrieved or, if filed by a member of the division, when executed by the member on oath or affirmation. A charge is deemed filed by or on behalf of a person claiming to be aggrieved if received from the United States equal employment opportunity commission. A charge shall be in writing on oath or affirmation and shall contain the information, including the date, place and circumstances of the alleged unlawful employment practice, and be in the form as the division requires. The division shall not make charges public.

B. Whenever a charge is filed by or on behalf of a person claiming to be aggrieved or by a member of the division, referred to as the charging party, alleging that an employer, employment agency, labor organization or joint labor-management committee controlling apprenticeship or other training or retraining programs, including on-the-job training programs, has engaged in an unlawful employment practice, the division shall serve notice of and a copy of the charge on the employer, employment agency, labor organization or joint labor-management committee, referred to as the respondent, within ten days and shall investigate the charge. If the division determines after the investigation that there is not reasonable cause to believe that the charge is true, the division shall enter an order determining the same and dismissing the charge and shall notify the charging party and the respondent of its action. If the division determines after the investigation that there is reasonable cause to believe that the charge is true, the division shall enter an order containing its findings of fact and shall endeavor to eliminate the alleged unlawful employment practice by informal methods of conference, conciliation and persuasion. Any party to the informal proceeding may be represented by counsel. Counsel need not be a member of the state bar if counsel is licensed to practice law in any other state or territory of the United States. Nothing said or done during and as a part of the informal endeavors may be made public by the division or its officers or employees or used as evidence in a subsequent proceeding without the written consent of the persons concerned. If a civil action resulting from a charge is commenced in any federal or state court, evidence collected by or submitted to the division during the investigation of the charge and the source of the evidence shall be subject to discovery by the parties to the civil action. Any person who makes public information in violation of this subsection is guilty of a class 1 misdemeanor. The division shall make its determination on reasonable cause as promptly as possible and as far as practicable not later than sixty days from the filing of the charge. If more than two years have elapsed after the alleged unlawful employment practice occurred, and if the charging party has received a notice of right to sue, the division may cease investigation of a charge without reaching a determination.

C. All conciliation agreements shall provide that the charging party waives, releases and covenants not to sue the respondent or claim against the respondent in any forum with respect to the matters which were alleged as charges filed with the division, subject to performance by the respondent of the promises and representations contained in the conciliation agreement. The charging party or the respondent may prepare a conciliation agreement that the division shall submit to the other party and that, if accepted by the other party, shall be accepted by the division.

D. If within thirty days after the division has made a determination that reasonable cause exists to believe that the charge is true the division has not accepted a conciliation agreement to which the charging party and the respondent are parties, the division may bring a civil action against the respondent, other than the state, named in the charge. The charging party shall have the right to intervene in a civil action brought by the division. If a charge filed with the division pursuant to subsection A of this section is dismissed by the division or if within ninety days from the filing of such charge the division has not filed a civil action under this section or has not entered into a conciliation agreement with the charging party, the division shall so notify the charging party. After providing the notice a civil action may be brought against the respondent named in the charge by the charging party or, if that charge was filed by a member of the division, by any person whom the charge alleges was aggrieved by the alleged unlawful employment practice. In no event shall any action be brought pursuant to this article more than one year after the charge to which the action relates has been filed. On application by the complainant and in the circumstances as the court may deem just, the court may appoint an attorney for such complainant and may authorize the commencement of the action without the payment of fees, costs or security. On timely application, the court may in its discretion allow the division to intervene in civil actions in which the state is not a defendant on certification that the case is of general public importance. Upon request the court may stay further proceedings for not more than sixty days pending the further efforts of the parties or the division to obtain voluntary compliance.

E. Whenever a charge is filed with the division and the division concludes on the basis of a preliminary investigation that prompt judicial action is necessary to carry out the purposes of this article or article 4 of this chapter, the division may bring an action for appropriate temporary or preliminary relief pending final disposition of the charge. Any temporary restraining order or other order granting preliminary or temporary relief shall be issued in accordance with the Arizona rules of civil procedure. The court having jurisdiction over the proceedings shall assign such action for hearing at the earliest practicable date and cause the action to be expedited in every way.

F. The court shall assign any action brought under this article for hearing at the earliest practicable date and cause the action to be in every way expedited. If the action has not been scheduled for trial within one hundred twenty days after issue has been joined, the judge may appoint a master pursuant to rule 53 of the Arizona rules of civil procedure.

G. If the court finds that the defendant has intentionally engaged in or is intentionally engaging in an unlawful employment practice alleged in the complaint, the court may enjoin the defendant from engaging in the unlawful employment practice and order the affirmative action as may be appropriate. Affirmative action may include, but is not limited to, reinstatement or hiring of employees with or without back pay payable by the employer, employment agency or labor organization responsible for the unlawful employment practice or any other equitable relief as the court deems appropriate. Back pay liability shall not accrue from a date more than two years before the filing of the charge with the division. Interim earnings or amounts earnable with reasonable diligence by the person or persons discriminated against shall reduce the back pay otherwise allowable. An order of the court shall not require the admission or reinstatement of an individual as a member of a union or the hiring, reinstatement or promotion of an individual as an employee or the payment to the individual of any back pay if the individual was refused admission, suspended or expelled or was refused employment or advancement or was suspended or discharged for any reason other than discrimination on account of race, color, religion, sex, age, disability or national origin or a violation of section 41-1464.

H. In any case in which an employer, employment agency or labor organization fails to comply with an order of a court issued in a civil action brought under this section, a party to the action or the division on the written request of a person aggrieved by such failure may commence proceedings to compel compliance with the order.

I. Any civil action brought under this section and any proceedings brought under subsection H of this section are subject to appeal as provided in sections 12-120.21, 12-120.22 and 12-120.24.

J. In any action or proceeding under this section the court may allow the prevailing party, other than the division, a reasonable attorney fee as part of the costs.

§ 41-1482 Recordkeeping; preservation of records; reports to division; furnishing information to other governmental agencies; information confidential; classification

A. Every employer, employment agency and labor organization subject to article 4 of this chapter shall make and keep such records relevant to the determination of whether unlawful employment practices have been or are being committed, preserve such records for such periods and make such reports therefrom as the division shall prescribe by regulation or order, after public hearing, as reasonable, necessary or appropriate for the enforcement of this article and article 4. Compliance with reporting and recordkeeping regulations issued by the United States equal employment opportunity commission shall be compliance with this subsection. Any employer, employment agency, labor organization or joint labor-management committee which believes that the application to it of any regulation or order issued under this section would result in undue hardship may apply to the division for an exemption. If an application for such exemption is denied, a civil action may be brought in the superior court for the county where such records are kept. If the division of the court, as the case may be, finds that the application of the regulation or order to the employer, employment agency or labor organization in question, or in general, would impose an undue hardship, the division or the court, as the case may be, may grant appropriate relief. If any person required to comply with the provisions of this subsection fails or refuses to do so, the superior court for the county in which such person is found, resides or transacts business shall upon application of the division issue to such person an order requiring him to comply.

B. In prescribing requirements pursuant to subsection A, the division shall consult with other interested governmental agencies and shall coordinate its requirements with those adopted by such agencies. Upon request the division may furnish to any such governmental agency charged with the administration of a fair employment practices law information obtained pursuant to subsection A from any employer, employment agency, labor organization or joint labor-management committee subject to the jurisdiction of such agency. Such information shall be furnished on condition that it not be made public by the recipient agency prior to the institution of a proceeding under applicable law involving such information. If this condition is violated by a recipient agency, the division may decline to honor subsequent requests of such agency.

C. It is unlawful for any officer or employee of the division or the board to make public in any manner whatever any information obtained by the division pursuant to its authority under this section prior to the institution of any proceeding involving such information under this article. Any officer, employee or agent of the division or the board who shall make public in any manner whatever any information in violation of this subsection is guilty of a class 1 misdemeanor.

§ 41-1483 Notices to be posted; violation; classification

A. Every employer, employment agency and labor organization shall post and keep posted in conspicuous places upon its premises where notices to employees, applicants for employment and members are customarily posted a notice to be prepared or approved by the division setting forth excerpts from or summaries of the pertinent provisions of this article and article 4 and information pertinent to the filing of a complaint.

B. Intentional failure to post such notices after having been furnished such notices by the division is a petty offense.

§ 41-1484 Rules and regulations; good faith compliance as defense in agency and court proceedings

In any action or proceeding based on an alleged unlawful employment practice, no person shall be subject to liability or punishment for or on account of the commission by such person of an unlawful employment practice if he pleads and proves that the act or omission complained of was in good faith, in conformity with and in reasonable reliance on any interpretation or opinion of the division or the failure of such person to publish or file any information required by any provision of this article if he pleads and proves that he failed to publish or file such information in good faith, in conformity with and in reasonable reliance on any instructions of the division regarding the publishing or filing of such information. Either defense, if established, shall be a bar to the action or proceeding, notwithstanding that after such act or omission, such interpretation or opinion is modified or rescinded or is determined by judicial authority to be invalid or of no legal effect or after failing to publish or file pursuant to the instructions of the division such instructions are determined by judicial authority not to be in conformity with the requirements of this article.

Article 7 Fair Housing

§ 41-1491 Definitions

In this article, unless the context otherwise requires:

"Aggrieved person" includes any person who either:

(a) Claims to have been injured by a discriminatory housing practice.

(b) Believes that the person will be injured by a discriminatory housing practice that is about to occur.

"Assistance animal" means a trained or untrained animal that works, provides assistance, performs tasks or provides therapeutic or emotional support for the benefit of a person with a disability.
"Complainant" means a person, including the attorney general, who files a complaint under section 41-1491.22.
"Conciliation" means the attempted resolution of issues raised by a complaint or by the investigation of the complaint through informal negotiations involving the aggrieved person, the respondent and the attorney general.
"Conciliation agreement" means a written agreement setting forth the resolution of the issues in conciliation.
"Disability" means a mental or physical impairment that substantially limits at least one major life activity, a record of such an impairment or being regarded as having such an impairment. Disability does not include current illegal use of or addiction to any drug or illegal or federally controlled substance. Disability shall be defined and construed as the term is defined and construed by the Americans with disabilities act of 1990 (P.L. 101-336) and the ADA amendments act of 2008 (P.L. 110-325; 122 Stat. 3553).
"Discriminatory housing practice" means an act prohibited by sections 41-1491.14 through 41-1491.21.
"Dwelling" means either:

(a) Any building, structure or part of a building or structure that is occupied as, or designed or intended for occupancy as, a residence by one or more families.

(b) Any vacant land that is offered for sale or lease for the construction or location of a building, structure or part of a building or structure described by subdivision (a) of this paragraph.

"Family" includes a single individual.
"Person" means one or more individuals, corporations, partnerships, associations, labor organizations, legal representatives, mutual companies, joint stock companies, trusts, unincorporated organizations, trustees, receivers, fiduciaries, banks, credit unions and financial institutions.
"Respondent" means either:

(a) The person accused of a violation of this article in a complaint of a discriminatory housing practice.

(b) Any person identified as an additional or substitute respondent under section 41-1491.25 or an agent of an additional or substitute respondent.

"Service animal":

(a) Means any dog or miniature horse that is individually trained or in training to do work or perform tasks for the benefit of an individual with a disability, including a physical, sensory, psychiatric, intellectual or other mental disability.

(b) Does not include other species of animals, whether wild or domestic, trained or untrained.

"To rent" includes to lease, to sublease, to let or to otherwise grant for a consideration the right to occupy premises not owned by the occupant.

§ 41-1491.01 Discrimination due to familial status

In this article, a discriminatory act is committed because of familial status if the act is committed because the person who is the subject of discrimination is:

Pregnant.
Domiciled with an individual younger than eighteen years of age in regard to whom the person either:

(a) Is the parent or legal custodian.

(b) Has the written permission of the parent or legal custodian for domicile with that person.

In the process of obtaining legal custody of an individual younger than eighteen years of age.

§ 41-1491.02 Exempt sales and rentals

A. Except as provided in subsection B of this section, sections 41-1491.14 through 41-1491.21 do not apply to:

The sale or rental of a single family house sold or rented by an owner if:

(a) The owner does not:

(i) Own more than three single family houses at any one time.

(ii) Own any interest in, nor is there owned or reserved on his behalf, under any express or voluntary agreement, title to or any right to any part of the proceeds from the sale or rental of more than three single family houses at any one time.

(b) The house was sold or rented without either:

(i) The use of the sales or rental facilities or services of a real estate broker, agent or salesman licensed under title 32, chapter 20 or the use of an employee or agent of a licensed broker, agent or salesman or the facilities or services of the owner of a dwelling designed or intended for occupancy by five or more families.

(ii) The publication, posting or mailing of a notice, statement or advertisement prohibited by section 41-1491.15.

The sale or rental of rooms or units in a dwelling containing living quarters occupied or intended to be occupied by no more than four families living independently of each other if the owner maintains and occupies one of the living quarters as the owner's residence.

B. The exemption in subsection A, paragraph 1 of this section applies to only one sale or rental in a twenty-four month period if the owner was not the most recent resident of the house at the time of the sale or rental.

§ 41-1491.03 Religious organization and private club exemption

A. This article does not prohibit a religious organization, association or society or a nonprofit institution or organization operated, supervised or controlled by or in conjunction with a religious organization, association or society from:

Limiting the sale, rental or occupancy of dwellings that it owns or operates for other than a commercial purpose to persons of the same religion.
Giving preference to persons of the same religion, unless membership in the religion is restricted because of race, color or national origin.

B. This article does not prohibit a private club that is not open to the public and that, as an incident to its primary purpose, provides lodging that it owns or operates for other than a commercial purpose from limiting the rental or occupancy of that lodging to its members or from giving preference to its members.

§ 41-1491.04 Housing for older persons exempted; rules; liability; definition

A. The provisions of this article relating to familial status do not apply to housing for older persons.

B. The attorney general may adopt rules setting forth criteria for housing for older persons. The rules adopted for subsection D, paragraph 3 shall require the following factors:

That at least eighty per cent of the units are occupied by at least one person fifty-five years of age or older per unit. Rules adopted for verification of occupancy shall provide for the use of reliable surveys and affidavits. These surveys and affidavits are admissible in administrative and judicial proceedings. Rules adopted establishing compliance with this paragraph shall be consistent with federal fair housing regulations.
The publication of, and adherence to, policies and procedures that demonstrate an intent by the owner or manager to provide housing for persons fifty-five years of age or older. Rules adopted establishing compliance with this paragraph shall be consistent with federal fair housing regulations.

C. A person shall not be held personally liable for monetary damages under section 41-1491.31 if the person relied in good faith that the housing was exempt from this article because it was housing for older persons as defined under subsection D, paragraph 3 of this section. For the purposes of this subsection a person may only demonstrate good faith reliance on the exemption from the provisions of this article if both:

The person has no actual knowledge that the facility or community does not, or will not qualify as housing for older persons as defined under subsection D, paragraph 3 of this section.
The facility or community has formally stated in writing that the facility or community is housing for older persons as defined under subsection D, paragraph 3 of this section.

D. In this section, "housing for older persons" means housing that meets any of the following conditions:

Is specifically designed and operated to assist elderly persons under a federal or state program.
Is intended for, and solely occupied by, persons sixty-two years of age or older.
Is intended and operated for occupancy by at least one person fifty-five years of age or older per unit.

§ 41-1491.05 Appraisal exemption

This article does not prohibit a person engaged in the business of furnishing appraisals of real property from taking into consideration factors other than race, color, religion, sex, disability, familial status or national origin.

§ 41-1491.06 Effect on other law

A. This article does not affect a reasonable local or state restriction on the maximum number of occupants permitted to occupy a dwelling or a restriction relating to health or safety standards.

B. This article does not affect a requirement of nondiscrimination in any other state or federal law.

C. Nothing in this article prohibits cities or towns with a population of three hundred fifty thousand or more persons according to the 1990 United States decennial census from enacting ordinances, not later than January 1, 1995, that are substantially equivalent to the provisions of federal law and this article.

§ 41-1491.07 Administration by attorney general

The attorney general shall administer this article.

§ 41-1491.08 Rules

The attorney general may adopt interpretive and procedural rules necessary to implement this article.

§ 41-1491.09 Complaints

The attorney general shall receive, investigate, seek to conciliate and act on complaints alleging violations of this article.

§ 41-1491.10 Reports; studies

A. The attorney general shall publish annually a written report recommending legislative or other action to carry out the purposes of this article. This report shall contain, for the preceding fiscal year, the following information:

The number of complaints initiated by the attorney general.
The number of complaints filed with the attorney general by aggrieved persons.
The number of complaints dismissed by the attorney general.
The number of complaints that resulted in conciliation agreements.
The number of complaints for which the attorney general found reasonable cause that a discriminatory housing practice occurred or was about to occur.
The number of civil actions filed by the attorney general pursuant to section 41-1491.34.
A description of the results of the regulatory sandbox program established pursuant to chapter 55 of this title.

B. The report shall include a description of the relief awarded in civil actions and, without attribution, benefits to complainants agreed to in conciliation agreements. The report shall also include the number of instances in the preceding fiscal year, and the reasons therefor, but without attribution to parties, the number of investigations that were not completed within the time periods provided by section 41-1491.24, subsection B or a determination made pursuant to section 41-1491.29, subsection B.

C. The attorney general may make studies relating to the nature and extent of discriminatory housing practices in this state.

§ 41-1491.11 Cooperation with other entities

The attorney general shall cooperate with federal fair housing agencies and, as appropriate, may provide technical and other assistance to federal, state, local and other public or private entities that are formulating or operating programs to prevent or eliminate discriminatory housing practices. Nothing in this article shall be interpreted as prohibiting a political subdivision of this state from administering fair housing projects or cities or towns with a population of three hundred fifty thousand or more persons according to the 1990 United States decennial census from adopting a fair housing ordinance.

§ 41-1491.12 Subpoenas; discovery

The attorney general may issue subpoenas and compel the production of documents and the giving of testimony, as provided by section 41-1403.

§ 41-1491.13 Referral to city or town

A. The attorney general may defer proceedings under this article and refer a complaint to a city or town with a population of three hundred fifty thousand or more persons according to the 1990 United States decennial census that has been recognized by the United States department of housing and urban development as having adopted ordinances providing fair housing rights and remedies that are substantially equivalent to those granted under federal law and this article and that has entered into an intergovernmental agreement with the attorney general.

B. For a city or town with a population of three hundred fifty thousand or more persons according to the 1990 United States decennial census to be eligible to implement the provisions of this article it shall adopt a fair housing ordinance by January 1, 1995.

C. If the substantial equivalency status is revoked or decertified by the United States department of housing and urban development, the attorney general shall assume sole responsibility for the implementation and enforcement of this article.

§ 41-1491.14 Discrimination in sale or rental

A. A person may not refuse to sell or rent after a bona fide offer has been made or refuse to negotiate for the sale or rental of or otherwise make unavailable or deny a dwelling to any person because of race, color, religion, sex, familial status or national origin.

B. A person may not discriminate against any person in the terms, conditions or privileges of sale or rental of a dwelling, or in providing services or facilities in connection with the sale or rental, because of race, color, religion, sex, familial status or national origin.

C. This section does not prohibit discrimination against a person because the person has been convicted under federal law or the law of any state of the illegal manufacture or distribution of a controlled substance.

§ 41-1491.15 Publication of sales or rentals

A person may not make, print or publish or cause to be made, printed or published any notice, statement or advertisement with respect to the sale or rental of a dwelling that indicates any preference, limitation or discrimination based on race, color, religion, sex, disability, familial status or national origin or an intention to make such a preference, limitation or discrimination.

§ 41-1491.16 Inspection of dwelling

A person may not represent to any person because of race, color, religion, sex, disability, familial status or national origin that a dwelling is not available for inspection for sale or rental if the dwelling is available for inspection.

§ 41-1491.17 Entry into neighborhood

A person, for profit, may not induce or attempt to induce a person to sell or rent a dwelling by representations regarding the entry or prospective entry into a neighborhood of a person of a particular race, color, religion, sex, disability, familial status or national origin.

§ 41-1491.18 Prohibition of intimidation

A person may not coerce, intimidate, threaten or interfere with any person in the exercise or enjoyment of, or having exercised or enjoyed, or on account of his having aided or encouraged any other person in the exercise or enjoyment of, any right granted or protected by this section and sections 41-1491.14, 41-1491.15, 41-1491.16, 41-1491.17, 41-1491.19, 41-1491.20 and 41-1491.21.

§ 41-1491.19 Discrimination due to disability; definitions

A. A person may not discriminate in the sale or rental or otherwise make unavailable or deny a dwelling to any buyer or renter because of a disability of:

That buyer or renter.
A person residing in or intending to reside in that dwelling after it is sold, rented or made available.
A person associated with that buyer or renter.

B. A person may not discriminate against any person in the terms, conditions or privileges of sale or rental of a dwelling or in the provision of services or facilities in connection with the dwelling because of a disability of:

That person.
A person residing in or intending to reside in that dwelling after it is so sold, rented or made available.
A person associated with that person.

C. Nothing in this section requires that a dwelling be made available to an individual whose tenancy would constitute a direct threat to the health or safety of other individuals or whose tenancy would result in substantial physical damage to the property of others.

D. Compliance with the appropriate requirements of the fair housing accessibility guidelines established by the United States department of housing and urban development satisfies the requirements of subsection E, paragraph 3, subdivision (c).

E. For the purposes of this section, "discrimination" includes:

A refusal to permit, at the expense of the person with a disability, reasonable modifications of existing premises occupied or to be occupied by the person if the modifications may be necessary to afford the person full enjoyment of the premises, provided that, in the case of a renter, the landlord may, where it is reasonable to do so, condition permission for a modification on the renter agreeing, to restore the interior of the premises to the condition that existed before the modification, reasonable wear and tear excepted.
A refusal to make reasonable accommodations in rules, policies, practices or services if the accommodations may be necessary to afford the person equal opportunity to use and enjoy a dwelling.
In connection with the design and construction of covered multifamily dwellings for first occupancy after the date that is thirty months after the date of enactment of the federal fair housing amendments act of 1988 (P.L. 100-430), a failure to design and construct those dwellings in a manner that includes all of the following:

(a) The public use and common use portions of the dwellings are readily accessible to and usable by persons with a disability.

(b) All the doors designed to allow passage into and within all premises within the dwellings are sufficiently wide to allow passage by persons with a disability in wheelchairs.

(i) An accessible route into and through the dwelling.

(ii) Light switches, electrical outlets, thermostats and other environmental controls in accessible locations.

(iii) Reinforcements in bathroom walls to allow later installation of grab bars.

(iv) Usable kitchens and bathrooms so that an individual in a wheelchair can maneuver about the space.

F. As used in this section, "covered multifamily dwellings" means buildings consisting of four or more units if the buildings have one or more elevators and ground floor units in other buildings consisting of four or more units.

§ 41-1491.20 Residential real estate related transaction; definition

A. A person whose business includes engaging in residential real estate related transactions may not discriminate against a person in making a real estate related transaction available or in the terms or conditions of a real estate related transaction because of race, color, religion, sex, disability, familial status or national origin.

B. In this section, "residential real estate related transaction" means:

Making or purchasing loans or providing other financial assistance either:

(a) To purchase, construct, improve, repair or maintain a dwelling.

(b) To secure residential real estate.

Selling, brokering or appraising residential real property.

§ 41-1491.21 Brokerage services

A person may not deny any person access to, or membership or participation in, a multiple listing service, real estate brokers' organization or other service, organization or facility relating to the business of selling or renting dwellings or may not discriminate against a person in the terms or conditions of access, membership or participation in such an organization, service or facility because of race, color, religion, sex, disability, familial status or national origin.

§ 41-1491.22 Complaints

A. The attorney general shall investigate alleged discriminatory housing practices. The attorney general, on his own initiative, may file such a complaint.

B. A complaint shall be in writing, under oath and in the form prescribed by the attorney general.

C. An aggrieved person may file, not later than one year after an alleged discriminatory housing practice has occurred or terminated, whichever is later, a complaint with the attorney general alleging the discriminatory housing practice.

D. Not later than one year after an alleged discriminatory housing practice has occurred or terminated, whichever is later, the attorney general may file his own complaint.

E. A complaint may be amended at any time.

F. On the filing of a complaint the attorney general shall:

Give the aggrieved person notice that the complaint has been received.
Advise the aggrieved person of the time limits and choice of forums under this article.
Not later than twenty days after the filing of the complaint or the identification of an additional respondent under section 41-1491.25 serve on each respondent:

(a) A notice identifying the alleged discriminatory housing practice and advising the respondent of the procedural rights and obligations of a respondent under this article.

(b) A copy of the original complaint.

G. Notices and other documents required to be served under this article may be served as provided by section 41-1403, subsection B, paragraph 4.

§ 41-1491.23 Answer to complaint

A. Not later than ten days after receipt of the notice and copy under section 41-1491.22, subsection F, paragraph 3, a respondent may file an answer to the complaint.

B. The answer shall be in writing, under oath and in the form prescribed by the attorney general.

C. An answer may be amended at any time.

D. An answer does not inhibit the investigation of a complaint.

§ 41-1491.24 Investigation

A. If the federal government has referred a complaint to the attorney general or has deferred jurisdiction over the subject matter of the complaint to the attorney general, and if the attorney general has accepted the referral or deferral, the attorney general shall promptly investigate the allegations set forth in the complaint.

B. The attorney general shall investigate all complaints and, except as provided by subsection C, shall complete an investigation not later than one hundred days after the date the complaint is filed, or if it is unable to complete the investigation within this period, shall dispose of all proceedings related to the investigation not later than one year after the date the complaint is filed.

C. If the attorney general is unable to complete an investigation within the time periods prescribed by subsection B, the attorney general shall notify the complainant and the respondent in writing of the reasons for the delay.

§ 41-1491.25 Additional or substitute respondent

A. The attorney general may join a person not named in the complaint as an additional or substitute respondent if in the course of the investigation the attorney general determines that the person should be accused of a discriminatory housing practice.

B. In addition to the information required in the notice under section 41-1491.22, subsection F, paragraph 3, the attorney general shall include in a notice to a respondent joined under this section an explanation of the basis for the determination that the person is properly joined as a respondent.

§ 41-1491.26 Conciliation

A. The attorney general shall engage, to the extent feasible, in conciliation, including, if appropriate, mediation, with respect to the complaint.

B. A conciliation agreement is an agreement between a respondent and the complainant and is subject to approval by the attorney general.

C. A conciliation agreement may provide for binding arbitration or another method of dispute resolution. Dispute resolution that results from a conciliation agreement may authorize appropriate relief, including monetary relief.

D. A conciliation agreement shall not be made public unless all parties agree to the disclosure or the attorney general determines that disclosure is necessary to further the purposes of this article.

E. Nothing said or done in the course of conciliation may be made public or used as evidence in a subsequent proceeding under this article without the written consent of the persons concerned.

F. Materials in the investigative file may be disclosed to the parties to the extent reasonably necessary to further the investigation or conciliation discussions. Materials in the investigative file may be disclosed to the complainant for the purpose of deciding whether to file a complaint in court and may be disclosed to the respondent for the purpose of formulating its answer. After a court action has been filed, information derived from the investigation and the final investigation report relating to the investigation shall be subject to discovery.

§ 41-1491.27 Temporary or preliminary relief

If the attorney general concludes at any time after the filing of a complaint that prompt judicial action is necessary to carry out the purposes of this article, the attorney general may file a civil action for appropriate temporary or preliminary relief pending final disposition of the complaint.

§ 41-1491.28 Investigative reports

A. The attorney general shall prepare a final investigative report showing:

The names and dates of contacts with witnesses.
A summary of correspondence and other contacts with the aggrieved person and the respondent showing the dates of the correspondence and contacts.
A summary description of other pertinent records.
A summary of witness statements.
Answers to interrogatories.

B. A final report under this section may be amended if additional evidence is discovered.

§ 41-1491.29 Reasonable cause determination

A. The attorney general shall determine based on the facts whether reasonable cause exists to believe that a discriminatory housing practice has occurred or is about to occur.

B. The attorney general shall make the determination under subsection A of this section not later than one hundred days after the date a complaint is filed unless either:

It is impracticable to make the determination.
The attorney general has approved a conciliation agreement relating to the complaint.

C. If it is impracticable to make the determination within the time period provided by subsection B of this section, the attorney general shall notify the complainant and respondent in writing of the reasons for the delay.

D. If the attorney general determines that reasonable cause exists to believe that a discriminatory housing practice has occurred or is about to occur, the attorney general shall attempt for a period of not more than thirty days to effectuate a conciliation agreement. If no conciliation agreement has been reached after thirty days, the attorney general shall file a civil action in superior court, as provided in section 41-1491.34.

§ 41-1491.30 Dismissal of complaint

If the attorney general determines that no reasonable cause exists to believe that a discriminatory housing practice has occurred or is about to occur, the attorney general shall promptly dismiss the complaint and give written notice of the dismissal to the complainant and respondent.

§ 41-1491.31 Civil action

A. An aggrieved person may file a civil action in superior court not later than two years after the occurrence of the termination of an alleged discriminatory housing practice or the breach of a conciliation agreement entered into under this article, whichever occurs last, to obtain appropriate relief with respect to the discriminatory housing practice or breach.

B. The two year period does not include any time elapsed between the filing of any court procedure to enforce an administrative subpoena and is not jurisdictional but is a statute of limitations subject to principles of estoppel, tolling and waiver.

C. An aggrieved person may file an action under this section whether or not a complaint has been filed under section 41-1491.22 and without regard to the status of any complaint filed under section 41-1491.22. The filing of an action under this section does not affect the attorney general's power and duty to investigate and make determinations based on the aggrieved person's administrative complaint.

D. If the attorney general has obtained a conciliation agreement with the consent of an aggrieved person, the aggrieved person may not file an action under this section with respect to the alleged discriminatory housing practice that forms the basis for the complaint except to enforce the terms of the agreement.

E. An aggrieved person may intervene in a civil action filed by the attorney general and based on that person's administrative complaint.

F. The rights granted by 42 United States Code sections 3603, 3604, 3605 and 3606 may be enforced in any civil action brought pursuant to this section.

§ 41-1491.32 Court appointed attorney

On application by a person alleging a discriminatory housing practice or by a person against whom a discriminatory housing practice is alleged, the superior court may appoint an attorney for the person.

§ 41-1491.33 Relief granted

In an action under section 41-1491.31, if the superior court finds that a discriminatory housing practice has occurred or is about to occur, the court may award to the plaintiff:

Actual and punitive damages.
Reasonable attorney fees.
Court costs.
A permanent or temporary injunction, temporary restraining order or other order, including an order enjoining the defendant from engaging in the practice or ordering appropriate affirmative action.

§ 41-1491.34 Civil action by attorney general

A. If the attorney general finds cause to believe that a discriminatory housing practice has occurred or is about to occur, and there is no conciliation agreement within thirty days, the attorney general shall immediately file a civil action on behalf of the complainant in superior court against the respondent.

B. If the attorney general finds reasonable cause to believe that a party has breached a conciliation agreement, the attorney general shall file a civil action for enforcement of the agreement.

C. In an action under this section, the court may award on behalf of the complainant actual and punitive damages and may issue a permanent or temporary injunction, temporary restraining order or other order, including an order enjoining the defendant from engaging in the practice or ordering affirmative action, and may award court costs to the attorney general.

D. A person aggrieved by the alleged discriminatory housing practice or damaged by the alleged breach of the conciliation agreement may intervene in a civil action brought under this section.

§ 41-1491.35 Pattern or practice cases

A. The attorney general may file a civil action in superior court for appropriate relief if the attorney general has reasonable cause to believe that either:

A person is engaged in a pattern or practice of resistance to the full enjoyment of any right granted by this article.
A person has been denied any right granted by this article and that denial raises an issue of general public importance.

B. In an action under this section the court may:

Award preventive relief, including a permanent or temporary injunction, restraining order or other order against the person responsible for a violation of this article as necessary to assure the full enjoyment of the rights granted by this article.
Award other appropriate relief, including monetary damages, reasonable attorney fees and court costs.
To vindicate the public interest, assess a civil penalty against the respondent in an amount that does not exceed:

(a) Fifty thousand dollars for a first violation.

(b) One hundred thousand dollars for a second or subsequent violation.

§ 41-1491.36 Prevailing party; fees and costs

A court in a civil action brought under this article shall award reasonable attorney fees and costs to a prevailing plaintiff, except to the attorney general in an action brought under section 41-1491.33. The court shall not award attorney fees to a prevailing defendant unless the plaintiff's complaint was frivolous, unreasonable or without foundation.

§ 41-1491.37 Superior court enforcement; local fair housing

A. The superior court has jurisdiction to enforce a local fair housing ordinance with provisions substantially equivalent to the provisions of federal law and this article.

B. An incorporated city or town with a population of three hundred fifty thousand or more persons according to the 1990 United States decennial census that has a fair housing ordinance may file an action in superior court to enforce the ordinance.

§ 41-1491.38 Assistance animals; reasonable accommodation; immunity

Notwithstanding any other law, a landlord is not liable for injuries or damages caused by a purported assistance animal or purported service animal that is allowed as a reasonable accommodation or a reasonable modification on the landlord's property or within property controlled by the landlord. This section does not limit or abridge the rights of a person with a disability as otherwise prescribed in this chapter.

Article 8 Public Accommodation and Services

§ 41-1492 Definitions

In this article, unless the context otherwise requires:

"Americans with disabilities act" means 42 United States Code sections 12101 through 12213 and 47 United States Code sections 225 and 611 and the ADA amendments act of 2008 (P.L. 110-325; 122 Stat. 3553).
"Auxiliary aids and services" includes:

(a) Qualified interpreters or other effective methods of making aurally delivered materials available to individuals with hearing impairments.

(b) Qualified readers, taped text or other effective methods of making visually delivered materials available to individuals with visual impairments.

(d) Other similar services and actions.

"Being regarded as having such a physical or mental impairment":

"Commercial facilities" means facilities that are intended for nonresidential use and that do not meet the definition of either a public accommodation or a public entity. Commercial facilities do not include railroad locomotives, railroad freight cars, railroad cabooses, railroad cars, railroad rights-of-way or facilities that are covered or expressly exempted from coverage under this article.
"Demand responsive system" means any system of providing the transportation of individuals by a vehicle, other than a system that is a fixed route system.
"Disability" means, with respect to an individual, any of the following:

(a) A physical or mental impairment that substantially limits one or more of the major life activities of the individual.

(b) A record of such an impairment.

"Fixed route system" means a system of providing the transportation of individuals by, other than by aircraft, a vehicle that is operated along a prescribed route according to a fixed schedule.
"Major life activities" includes:

"Over-the-road bus" means a bus characterized by an elevated passenger deck located over a baggage compartment.
"Private entity" means any entity other than a public entity.
"Public accommodation" includes any:

(a) Inn, hotel, motel or other place of lodging, except for an establishment located within a building that contains not more than five rooms for rent or hire and that is actually occupied by the proprietor of the establishment as the residence of the proprietor.

(b) Restaurant, bar or other establishment serving food or drink.

(d) Auditorium, convention center, lecture hall or other place of public gathering.

(e) Bakery, grocery store, clothing store, hardware store, shopping center or other sales or retail establishment.

(f) Laundromat, dry cleaner, bank, barber shop, beauty shop, travel service, shoe repair service, funeral parlor, gas station, office of an accountant or lawyer, pharmacy, insurance office, professional office of a health care provider, hospital or other service establishment.

(g) Terminal, depot or other station used for specified public transportation.

(h) Museum, library, gallery or other place of public display or collection.

(i) Park, zoo, amusement park or other place of recreation.

(j) Nursery, elementary, secondary, undergraduate or postgraduate private school or other place of education.

(k) Day care center, senior citizen center, homeless shelter, food bank, adoption agency or other social service center establishment.

(l) Gymnasium, health spa, bowling alley, golf course or other place of exercise or recreation.

"Public entity" means any:

(a) State or local government.

(b) Department, agency, special purpose district or other instrumentality of a state or local government, including the legislature.

"Rail" or "railroad" has the meaning given the term "railroad" in section 202(e) of the federal railroad safety act of 1970 (45 United States Code section 431(e)).
"Readily achievable" means easily accomplishable and able to be carried out without much difficulty or expense. In determining whether an action is readily achievable, factors to be considered include:

(a) The nature and cost of the action needed under this article.

(b) The overall financial resources of the facility or facilities involved in the action, the number of persons employed at the facility, the effect on expenses and resources or the impact otherwise of such action on the operation of the facility.

(d) The overall size of the business of a covered entity with respect to the number of its employees.

(e) The number, type and location of the covered entity's facilities.

(f) The type of operation or operations of the covered entity, including the composition, structure and functions of the facilities in question to the covered entity.

"Specified public transportation" means transportation by bus, rail or any other conveyance, other than aircraft, that provides the general public with general or special service, including charter service, on a regular and continuing basis.
"State" means the state of Arizona.
"Vehicle" does not include a rail passenger car, railroad locomotive, railroad freight car, railroad caboose or railroad car covered under this article.

§ 41-1492.01 Prohibition of discrimination by public entities

A. All buildings and facilities that are used by public entities and that are leased or constructed in whole or in part with the use of state or local monies, the monies of any political subdivision of this state or any combination of these monies shall conform to title II of the Americans with disabilities act.

B. This article applies to permanent buildings, additions to buildings, temporary buildings and emergency construction.

§ 41-1492.02 Prohibition of discrimination by public accommodations and commercial facilities

A. No individual may be discriminated against on the basis of disability in the full and equal enjoyment of the goods, services, facilities, privileges, advantages or accommodations of any place of public accommodation by any person who owns, leases, leases to others or operates a place of public accommodation.

B. It is discriminatory to subject an individual or class of individuals on the basis of a disability or disabilities of that individual or class, directly or through contractual, licensing or other arrangements:

To a denial of the opportunity of the individual or class to participate in or benefit from the goods, services, facilities, advantages, privileges or accommodations of an entity.
To the loss of an opportunity to participate in or benefit from goods, services, facilities, privileges, advantages or accommodations that are not equal to those afforded to other individuals.
To a good, service, facility, privilege, advantage or accommodation that is different or separate from that provided to other individuals, unless the action is necessary to provide the individual or class of individuals with a good, service, facility, privilege, advantage, accommodation or other opportunity that is as effective as that provided to others. For the purposes of this subsection, "individual" or "individuals" refers to the clients or customers of the covered public accommodation that enters into the contractual, licensing or other arrangement.

C. Goods, services, facilities, privileges, advantages and accommodations shall be afforded to an individual with a disability in the most integrated setting appropriate to the needs of the individual.

D. Notwithstanding the existence of separate or different programs or activities provided in accordance with this section, an individual with a disability shall not be denied the opportunity to participate in programs or activities that are not separate or different. Nothing in this article shall be construed to require an individual with a disability to accept an accommodation, aid, service, opportunity or benefit that the individual chooses not to accept.

E. An individual or entity, directly or through contractual or other arrangements, shall not utilize standards or criteria or methods of administration that:

Have the effect of discriminating on the basis of disability.
Perpetuate the discrimination of others who are subject to common administrative control.

F. It is discriminatory to exclude or otherwise deny equal goods, services, facilities, privileges, advantages, accommodations or other opportunities to an individual or entity because of the known disability of an individual with whom the individual or entity is known to have a relationship or association.

G. For the purposes of subsection A of this section, "discriminated against" includes:

The imposition or application of eligibility criteria that screen out or tend to screen out an individual with a disability or any class of individuals with disabilities from fully and equally enjoying any goods, services, facilities, privileges, advantages or accommodations, unless these criteria can be shown to be necessary for the provision of the goods, services, facilities, privileges, advantages or accommodations being offered.
A failure to make reasonable modifications in policies, practices or procedures, if these modifications are necessary to afford these goods, services, facilities, privileges, advantages or accommodations to individuals with disabilities, unless the entity can demonstrate that making these modifications would fundamentally alter the nature of these goods, services, facilities, privileges, advantages or accommodations.
A failure to take such steps as may be necessary to ensure that no individual with a disability is excluded, denied services, segregated or otherwise treated differently than other individuals because of the absence of reasonable modifications in policies, practices or procedures or auxiliary aids and services, unless the entity can demonstrate that taking these steps would fundamentally alter the nature of the goods, service, facility, privilege, advantage or accommodation being offered or would result in an undue burden.
A failure to remove architectural barriers and communication barriers that are structural in nature in existing facilities and transportation barriers in existing vehicles and rail passenger cars used by an establishment for transporting individuals not including barriers that can only be removed through the retrofitting of vehicles or rail passenger cars by the installation of a hydraulic or other lift if the removal is readily achievable.
If an entity can demonstrate that the removal of a barrier under paragraph 4 of this subsection is not readily achievable, a failure to make these goods, services, facilities, privileges, advantages or accommodations available through alternative methods if these methods are readily achievable.

H. It is discriminatory for a private entity that operates a fixed route system and that is not subject to section 304 of the Americans with disabilities act to purchase or lease a vehicle with a seating capacity in excess of sixteen passengers, including the driver, for use on this system, for which a solicitation is made after September 30, 1992, that is not readily accessible to and usable by individuals with disabilities including individuals who use wheelchairs. If a private entity that operates a fixed route system and that is not subject to section 41-1492.04 purchases or leases a vehicle with a seating capacity of sixteen passengers or less, including the driver, for use on such system after September 30, 1992 that is not readily accessible to or usable by individuals with disabilities, it is discriminatory for this entity to fail to operate this system so that, if viewed in its entirety, this system ensures a level of service to individuals with disabilities, including individuals who use wheelchairs, equivalent to the level of service provided to individuals without disabilities. Fixed route and demand response systems do not apply to over-the-road buses. For the purposes of this subsection, "discriminatory" includes:

A failure of a private entity that operates a demand responsive system and that is not subject to section 41-1492.04 to operate the system so that, if viewed in its entirety, the system ensures a level of service to individuals with disabilities, including individuals who use wheelchairs, equivalent to the level of service provided to individuals without disabilities.
The purchase or lease by the entity for use on the system of a vehicle with a seating capacity in excess of sixteen passengers, including the driver, for which solicitations are made after September 30, 1992, that is not readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs, unless the entity can demonstrate that the system, if viewed in its entirety, provides a level of service to individuals with disabilities equivalent to that provided to individuals without disabilities.
The purchase or lease of an over-the-road bus that does not comply with section 306(a)(2) of the Americans with disabilities act by a private entity that provides transportation of individuals and that is not primarily engaged in the business of transporting people and any other failure of the entity to comply with section 306(a)(2) of the Americans with disabilities act.

I. Nothing in this article requires an entity to permit an individual to participate in or benefit from the goods, services, facilities, privileges, advantages and accommodations of the entity if the individual poses a direct threat to the health or safety of others. For the purposes of this subsection, "direct threat" means a significant risk to the health or safety of others that cannot be eliminated by modification of policies, practices or procedures or by the provision of auxiliary aids or services.

§ 41-1492.03 Incorporation of standards in building codes

A. The standards and specifications referred to in this article and its implementing rules as applying to public entities shall be incorporated in any building code in existence on or adopted after the effective date of this article by this state or any agency, department or political subdivision of this state. These standards and specifications apply to new construction and alterations and are not required in buildings or portions of existing buildings that do not meet the standards and specifications.

B. The standards and specifications referred to in this article and its implementing rules as applying to public accommodations and commercial facilities shall be incorporated in any building code in existence on or adopted subsequent to the effective date of this article by this state or any agency, department, or political subdivision of this state. These standards and specifications shall apply to new construction and alterations commenced after the effective date of such standards and specifications.

§ 41-1492.04 New construction and alterations in public accommodations and commercial facilities

A. Except as provided in subsection B of this section, as applied to public accommodations and commercial facilities, "discriminatory" for purposes of section 41-1492.02 includes:

A failure to design and construct facilities for first occupancy later than January 26, 1993 that are readily accessible to and usable by individuals with disabilities, except if an entity can demonstrate that it is structurally impracticable to meet the requirements of subsection B of this section in accordance with standards set forth or incorporated by reference in rules adopted under this article.
With respect to a facility or part of a facility that is altered by, on behalf of or for the use of an establishment in a manner that affects or could affect the usability of the facility or part of a facility, a failure to make alterations in such a manner that, to the maximum extent feasible, the altered portions of the facility are readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs. If the entity is undertaking an alteration that affects or could affect usability of or access to an area of the facility containing a primary function, the entity shall also make the alterations in such a manner that, to the maximum extent feasible, the path of travel to the altered area and the toilet rooms, telephones and drinking fountains serving the altered area are readily accessible to and usable by individuals with disabilities if the alterations to the path of travel or the toilet rooms, telephones and drinking fountains serving the altered area are not disproportionate to the overall alterations in terms of cost and scope.

B. Subsection A of this section shall not be construed to require the installation of an elevator for facilities that are fewer than three stories or that have less than three thousand square feet per story unless the building is a shopping center, a shopping mall or the professional office of a health care provider or unless the attorney general determines that a particular category of facilities requires the installation of elevators based on the usage of the facilities.

§ 41-1492.05 Prohibition of discrimination in specified public transportation services provided by private entities

A. No individual may be discriminated against on the basis of disability in the full and equal enjoyment of specified public transportation services provided by a private entity that is primarily engaged in the business of transporting people and whose operations affect commerce. For purposes of this subsection, "discriminated against" includes:

The imposition or application by an entity described in this subsection of eligibility criteria that screen out or tend to screen out an individual with a disability or any class of individuals with disabilities from fully enjoying the specified public transportation services provided by the entity, unless these criteria can be shown to be necessary for the provision of the services being offered.
The failure of the entity to:

(a) Make reasonable modifications consistent with those required under section 41-1492.02.

(b) Provide auxiliary aids and services consistent with the requirements of section 41-1492.02.

(c) Remove barriers consistent with the requirements of section 41-1492.02 and with the requirements of section 41-1492.03.

The purchase or lease by the entity of a new vehicle, other than an automobile, a van with a seating capacity of fewer than eight passengers, including the driver, or an over-the-road bus that is to be used to provide specified public transportation and for which a solicitation is made after August 26, 1991 that is not readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs, except that the new vehicle need not be readily accessible to and usable by these individuals if the new vehicle is to be used solely in a demand responsive system and if the entity can demonstrate that this system, if viewed in its entirety, provides a level of service to these individuals equivalent to the level of service provided to the general public.
The purchase or lease by the entity of an over-the-road bus that does not comply with section 306(a)(2) of the Americans with disabilities act and any other failure of the entity to comply with section 306(a)(2) of the Americans with disabilities act.
The purchase or lease by the entity of a new van with a seating capacity of fewer than eight passengers, including the driver, that is to be used to provide specified public transportation and that is not readily accessible to or usable by individuals with disabilities, including individuals who use wheelchairs, except that the van need not be readily accessible to and usable by these individuals if the entity can demonstrate that the system for which the van is being purchased or leased, if viewed in its entirety, provides a level of service to these individuals equivalent to the level of service provided to the general public.
The purchase or lease by the entity of a new rail passenger car that is to be used to provide specified public transportation, and for which a solicitation is made later than August 26, 1991, and that is not readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs.
The remanufacture by the entity of a rail passenger car that is to be used to provide specified public transportation in order to extend its usable life for ten years or more, or the purchase or lease by the entity of such a rail car, unless the rail car, to the maximum extent feasible, is made readily accessible to and usable by individuals with disabilities, including individuals who use wheelchairs.

B. To the extent that compliance with subsection A, paragraph 2, subdivision (c) or subsection A, paragraph 7 of this section would significantly alter the historic or antiquated character of an historical or antiquated rail passenger car, or a rail station served exclusively by such cars, or would result in a violation of any regulation, standard or order issued by the secretary of transportation under the federal railroad safety act of 1970, such compliance is not required. As used in this subsection, "historical or antiquated rail passenger car" means a rail passenger car:

That is at least thirty years old at the time of its use for transporting individuals.
The manufacturer of which is no longer in the business of manufacturing rail passenger cars.
That has a consequential association with events or persons significant to the past and that embodies, or is being restored to embody, the distinctive characteristics of a type of rail passenger car used in the past or to represent a time period that has passed.

§ 41-1492.06 Rules

A. Not more than one year after the effective date of this article, the attorney general shall adopt rules pursuant to chapter 6 of this title to carry out the intent of this article. The attorney general shall hold a reasonable number of public hearings at locations throughout the state prior to adoption of these rules. The attorney general shall publish the proposed rules and provide opportunity to receive testimony and written comments before adoption of the rules. The attorney general may request and receive appropriate technical assistance.

B. Compliance with titles II and III of the Americans with disabilities act and its implementing regulations shall be deemed in compliance with this article. The rules adopted under this article shall not exceed the regulations, guidelines and standards issued by the United States departments of transportation and justice relating to titles II and III of the Americans with disabilities act. No rule or amendment to a rule may be adopted without prior public hearing, prior publication, and opportunity to receive testimony and written comments.

C. The attorney general shall periodically review the final rules and amend rules if amendments are needed to achieve consistency with regulations promulgated pursuant to the Americans with disabilities act.

D. Nothing in this article is intended to limit the power of any political subdivision of this state to adopt rules or codes that exceed the requirements of this article.

E. The attorney general, on behalf of this state, shall apply for certification with the appropriate federal agency for the purpose of establishing that this section and its implementing rules meet the minimum requirements of the Americans with disabilities act.

§ 41-1492.07 Exemptions; private clubs, religious organizations and websites

This article does not apply to:

Private clubs or establishments exempted from coverage under title II of the civil rights act of 1964 (42 United States Code section 2000(a)(e)) or to religious organizations or entities controlled by religious organizations, including places of worship.
Websites.

§ 41-1492.08 Enforcement by an aggrieved person; notice; affidavit; prohibited demand for money; definition

A. Any aggrieved person who is subjected to discrimination in violation of section 41-1492.01, 41-1492.02, 41-1492.03, 41-1492.04, 41-1492.05 or 41-1492.11 or this article's implementing rules may institute a civil action for preventive or mandatory relief, including an application for a permanent or temporary injunction, restraining order or other order.

B. In the case of a violation of sections 41-1492.02 and 41-1492.04, injunctive relief includes an order to alter facilities to make these facilities readily accessible to and usable by individuals with disabilities to the extent required by this article. If appropriate, injunctive relief also includes requiring the provision of an auxiliary aid or service, the modification of a policy or the provision of alternative methods, to the extent required by this article.

C. An aggrieved person may file a civil action in superior court not later than two years after the occurrence or the termination of an alleged discriminatory public accommodation practice or the breach of a conciliation agreement entered into under this article, whichever occurs last, to obtain appropriate relief with respect to the discriminatory public accommodation practice or breach.

D. Nothing in this section requires a person with a disability to engage in a civil action.

E. Before filing a civil action pursuant to this section that alleges a public accommodation that is operated by a private entity has a building, facility or parking lot that violates this article and except as provided by subsection F of this section, the aggrieved person or the person's attorney shall provide written notice with sufficient detail to allow the private entity to identify and cure the violation or comply with the law. If the private entity does not cure the violation or comply with the law within thirty days after receiving the notice, the aggrieved person may file the civil action.

F. If the private entity is required to obtain a building permit or other similar form of government approval to make the changes necessary to cure the violation or comply with the law and the private entity, within thirty days after receiving the notice required by subsection E of this section, provides the aggrieved person or the person's attorney with a corrective action plan and submits the completed application for the building permit or other similar form of government approval to the appropriate governmental entity for a determination, the aggrieved person may not file the civil action for an additional sixty days from the date that the private entity provided the corrective action plan to the aggrieved person or the person's attorney. The time after the completed application for the building permit or other similar form of government approval is submitted to the governmental entity up until a final determination is provided to the private entity is tolled and is not included in calculating the additional sixty days, except that any delay that is caused by the private entity before the final determination is provided is not tolled. During the additional sixty days, the private entity must comply with the requirements of section 41-1492.04.

G. When filing a civil action pursuant to this section, an aggrieved person must file an affidavit, under penalty of perjury, that the aggrieved person has read the entire complaint, agrees with all of the allegations and facts contained in the complaint and, unless authorized by statute or rule, is not receiving and has not been promised anything of value in exchange for filing the civil action.

H. An aggrieved person or the aggrieved person's attorney may not demand or collect money from the private entity before the end of the applicable time period under subsections E and F of this section but may state that the private entity may be civilly liable for a violation of this article.

I. On the motion of any party, the court may stay an action filed pursuant to this section to determine whether the person filing the civil action or the person's attorney is a vexatious litigant or to determine whether there are multiple civil actions that involve the same plaintiff and that should be consolidated consistent with the Arizona rules of civil procedure.

J. For the purposes of this section, "sufficient detail" means the name of the aggrieved person who encountered the barrier, the date when the barrier was encountered by the aggrieved person and a description of the barrier that was encountered by the aggrieved person.

§ 41-1492.09 Enforcement by the attorney general; sanctions; use of sanction monies

A. The attorney general shall investigate all alleged violations of this article. These allegations must be filed within one hundred eighty days after the occurrence or the termination of the alleged discriminatory practice, shall be in writing under oath and shall be in such form as the attorney general requires. The attorney general shall undertake periodic reviews of compliance of covered entities under this article. If the attorney general concludes at any time after the filing of a complaint of alleged violation, or as a result of a periodic compliance review, that prompt judicial action is necessary to carry out the purpose of this article, the attorney general may file a civil action for appropriate temporary or preliminary relief pending final disposition of the complaint or compliance review. If, after investigation, the attorney general determines that reasonable cause exists to believe this article is being violated, the attorney general shall attempt for a period of not more than thirty days to effectuate a conciliation agreement. If no conciliation agreement has been reached after thirty days, the attorney general may file a civil action in an appropriate court. If the attorney general determines that no reasonable cause exists to believe that a violation of this article has occurred or is about to occur, the attorney general shall promptly dismiss the complaint and give written notice of the dismissal to the complainant and the person or entity complained against. If the attorney general finds reasonable cause to believe that a party has breached a conciliation agreement, the attorney general shall file a civil action for enforcement of the agreement.

B. In any civil action brought under this article, the court:

May grant any equitable relief that the court considers to be appropriate, including, to the extent required by this title:

(a) Granting temporary, preliminary or permanent relief.

(b) Providing an auxiliary aid or service, a modification of a policy, practice or procedure or an alternative method.

May award such other relief as the court considers appropriate, including monetary damages to aggrieved persons. For the purposes of this paragraph, monetary damages and such other relief do not include punitive damages.

C. In an action brought by the attorney general, the court, to vindicate the public interest, may assess a civil penalty against the covered person or entity in an amount of not more than:

$5,000 for a first violation.
$10,000 for any subsequent violation.

D. For the purposes of subsection C of this section, in determining whether a first or subsequent violation has occurred, a determination in a single action, by judgment or settlement, that the covered person or entity has engaged in more than one discriminatory act shall be deemed a single violation.

E. In a civil action brought by the attorney general, when considering what amount of civil penalty, if any, is appropriate, the court shall give consideration to any good faith effort or attempt to comply with this article by the entity. In evaluating good faith, the court shall consider, among other factors it deems relevant, whether the entity could have reasonably anticipated the need for an appropriate type of auxiliary aid needed to accommodate the unique needs of a particular individual with a disability.

F. In any action or proceeding under this section, the court may allow the prevailing party, other than the attorney general, reasonable attorney fees as part of the costs.

G. If appropriate, and to the extent authorized by law, the use of alternative means of dispute resolution, including settlement negotiations, conciliation, facilitation, mediation, fact-finding, mini-trials and arbitration, is encouraged to resolve disputes arising under this article.

H. In addition to any sanction that the court may award to a party pursuant to any rule or law in any civil action brought under this article, the court may impose a sanction on a plaintiff or the plaintiff's attorney if the court determines that an action or series of actions is brought under this article for the primary purpose of obtaining a payment from the defendant due to the costs of defending the action in a court. When imposing a sanction, the court may consider the totality of the abusive litigation-related practices of the plaintiff and the plaintiff's attorney.

I. If the court imposes a sanction pursuant to subsection H of this section, the court may order a party to pay a part of the sanction to the governor's office of youth, faith and family and, if ordered, the parties must notify the governor's office of youth, faith and family of the court's order. The governor's office of youth, faith and family must use these monies for the following purposes:

To educate covered persons or entities about the person's or entity's obligations under this article.
To award attorney fees to claimants who file a meritorious complaint with the attorney general and who resolve the complaint without litigation.

§ 41-1492.10 Prohibition against retaliation and coercion

A. No person may discriminate against any individual because the individual has opposed any act or practice made unlawful by this article or because the individual made a charge, testified, assisted or participated in any manner in an investigation, proceeding or hearing under this article.

B. It is unlawful to coerce, intimidate, threaten or interfere with any individual in the exercise or enjoyment of, for having exercised or enjoyed or on account of his having aided or encouraged any other individual in the exercise or enjoyment of any right granted or protected by this article.

§ 41-1492.11 Examination and courses

Any person that offers examinations or courses related to applications, licensing, certification or credentialing for secondary or postsecondary education, professional or trade purposes shall offer these examinations or courses in a place and manner accessible to persons with disabilities or offer alternative accessible arrangements for these individuals.

§ 41-1492.12 Interpretation of disability and substantially limits; definitions

A. A person shall define and construe a disability in favor of broad coverage of individuals under this article to the maximum extent permitted by the terms of this article.

B. A person shall interpret substantially limits consistently with the findings and purposes of the ADA amendments act of 2008 (P.L. 110-325; 122 Stat. 3553).

C. An impairment that substantially limits one major life activity need not limit other major life activities in order to be considered a disability.

D. An impairment that is episodic or in remission is a disability if it would substantially limit a major life activity when active.

E. The determination of whether an impairment substantially limits a major life activity shall be made without regard to the ameliorative effects of mitigating measures such as:

Medication, medical supplies, equipment or appliances, low-vision devices, excluding ordinary eyeglasses or contact lenses, prosthetics, including limbs and devices, hearing aids and cochlear implants or other implantable hearing devices, mobility devices or oxygen therapy equipment and supplies.
Use of assistive technology.
Reasonable accommodations or auxiliary aids or services.
Learned behavioral or adaptive neurological modifications.

F. The ameliorative effects of the mitigating measures of ordinary eyeglasses or contact lenses shall be considered in determining whether an impairment substantially limits a major life activity.

G. For the purposes of this section:

"Low-vision devices" means devices that magnify, enhance or otherwise augment a visual image.
"Ordinary eyeglasses or contact lenses" means lenses that are intended to fully correct visual acuity or eliminate refractive error.

Article 9 Free Exercise of Religion

§ 41-1493 Definitions

In this article, unless the context otherwise requires:

"Demonstrates" means meets the burdens of going forward with the evidence and of persuasion.
"Exercise of religion" means the ability to act or refusal to act in a manner substantially motivated by a religious belief, whether or not the exercise is compulsory or central to a larger system of religious belief.
"Government" includes this state and any agency or political subdivision of this state.
"Nonreligious assembly or institution" includes all membership organizations, theaters, cultural centers, dance halls, fraternal orders, amphitheaters and places of public assembly regardless of size that a government or political subdivision allows to meet in a zoning district by code or ordinance or by practice.
"Person" includes a religious assembly or institution.
"Political subdivision" includes any county, city, including a charter city, town, school district, municipal corporation or special district, any board, commission or agency of a county, city, including a charter city, town, school district, municipal corporation or special district or any other local public agency.
"Religion-neutral zoning standards":

(a) Means numerically definable standards such as maximum occupancy codes, height restrictions, setbacks, fire codes, parking space requirements, sewer capacity limitations and traffic congestion limitations.

(b) Does not include:

(i) Synergy with uses that a government holds as more desirable.

(ii) The ability to raise tax revenues.

"Suitable alternate property" means a financially feasible property considering the person's revenue sources and other financial obligations with respect to the person's exercise of religion and with relation to spending that is in the same zoning district or in a contiguous area that the person finds acceptable for conducting the person's religious mission and that is large enough to fully accommodate the current and projected seating capacity requirements of the person in a manner that the person deems suitable for the person's religious mission.
"Unreasonable burden" means that a person is prevented from using the person's property in a manner that the person finds satisfactory to fulfill the person's religious mission.

§ 41-1493.01 Free exercise of religion protected

A. Free exercise of religion is a fundamental right that applies in this state even if laws, rules or other government actions are facially neutral.

B. Except as provided in subsection C, government shall not substantially burden a person's exercise of religion even if the burden results from a rule of general applicability.

C. Government may substantially burden a person's exercise of religion only if it demonstrates that application of the burden to the person is both:

In furtherance of a compelling governmental interest.
The least restrictive means of furthering that compelling governmental interest.

D. A person whose religious exercise is burdened in violation of this section may assert that violation as a claim or defense in a judicial proceeding and obtain appropriate relief against a government. A party who prevails in any action to enforce this article against a government shall recover attorney fees and costs.

E. In this section, the term substantially burden is intended solely to ensure that this article is not triggered by trivial, technical or de minimis infractions.

§ 41-1493.02 Applicability

A. This article applies to all state and local laws and ordinances and the implementation of those laws and ordinances, whether statutory or otherwise, and whether adopted before or after the effective date of this article.

B. State laws that are adopted after the effective date of this article are subject to this article unless the law explicitly excludes application by reference to this article.

C. This article shall not be construed to authorize any government to burden any religious belief.

§ 41-1493.03 Free exercise of religion; land use regulation

A. Government shall not impose or implement a land use regulation in a manner that imposes an unreasonable burden on a person's exercise of religion, regardless of a compelling governmental interest, unless the government demonstrates one of the following:

That the person's exercise of religion at a particular location violates religion-neutral zoning standards enacted into the government's laws at the time of the person's application for a permit.
That the person's exercise of religion at a particular location would be hazardous due to toxic uses in adjacent properties.
The existence of a suitable alternate property the person could use for the exercise of religion.

B. Government shall not impose or implement a land use regulation in a manner that treats a religious assembly or institution on less than equal terms with a nonreligious assembly or institution, regardless of a compelling governmental interest.

C. Government shall not impose or implement a land use regulation in a manner that discriminates against an assembly or institution on the basis of religion, regardless of a compelling governmental interest.

D. Government shall not impose or implement a land use regulation in a manner that completely excludes a religious assembly or institution from a jurisdiction or unreasonably limits religious assemblies, institutions or structures within a jurisdiction, regardless of a compelling governmental interest.

§ 41-1493.04 Free exercise of religion; professional or occupational license; certificate or registration; appointments to governmental offices; definition

A. Government shall not deny, revoke or suspend a person's professional or occupational license, certificate or registration for any of the following and the following are not unprofessional conduct:

Declining to provide or participate in providing any service that violates the person's sincerely held religious beliefs except performing the duties of a peace officer.
Refusing to affirm a statement or oath that is contrary to the person's sincerely held religious beliefs.
Expressing sincerely held religious beliefs in any context, including a professional context as long as the services provided otherwise meet the current standard of care or practice for the profession.
Providing faith-based services that otherwise meet the current standard of care or practice for the profession.
Making business related decisions in accordance with sincerely held religious beliefs such as:

(a) Employment decisions, unless otherwise prohibited by state or federal law.

(b) Client selection decisions.

B. Government shall not deny a person an appointment to public office or a position on a board, commission or committee based on the person's exercise of religion.

C. This section is not a defense to and does not authorize any person to engage in sexual misconduct or any criminal conduct.

D. This section does not authorize any person to engage in conduct that is prohibited under the Constitution of the United States or of this state or section 15-535.

E. This section does not authorize any person to engage in conduct that violates the emergency medical treatment and active labor act (P.L. 99-272; 100 Stat. 164; 42 United States Code section 1395dd) or the religious land use and institutionalized persons act (P.L. 106-274; 114 Stat. 803; 42 United States Code section 2000CC-1) as of the effective date of this section.

F. For the purposes of this section, "government" includes all courts and administrative bodies or entities under the jurisdiction of the Arizona supreme court.

Article 10 Training and Instruction

§ 41-1494 Training, orientation and therapy; blame and judgment; prohibition; annual report; definition

A. This state, a state agency or a city, town, county or political subdivision of this state may not require an employee to engage in training, orientation or therapy that presents any form of blame or judgment on the basis of race, ethnicity or sex. This subsection does not preclude any training on sexual harassment.

B. This state, a state agency or a city, town, county or political subdivision of this state may not use public monies for training, orientation or therapy that presents any form of blame or judgment on the basis of race, ethnicity or sex. This subsection does not preclude any training on sexual harassment.

C. On or before December 1 of each year the department of administration shall submit a report that includes state agencies in compliance with this section to the governor, the president of the senate and the speaker of the house of representatives and submit a copy of this report to the secretary of state.

D. "Blame or judgment on the basis of race, ethnicity or sex" means the following concepts:

One race, ethnic group or sex is inherently morally or intellectually superior to another race, ethnic group or sex.
An individual, by virtue of the individual's race, ethnicity or sex, is inherently racist, sexist or oppressive, whether consciously or unconsciously.
An individual should be invidiously discriminated against or receive adverse treatment solely or partly because of the individual's race, ethnicity or sex.
An individual's moral character is determined by the individual's race, ethnicity or sex.
An individual, by virtue of the individual's race, ethnicity or sex, bears responsibility for actions committed by other members of the same race, ethnic group or sex.
An individual should feel discomfort, guilt, anguish or any other form of psychological distress because of the individual's race, ethnicity or sex.
Meritocracy or traits such as a hard work ethic are racist or sexist or were created by members of a particular race, ethnic group or sex to oppress members of another race, ethnic group or sex.

Article 11 Religion Is Essential

§ 41-1495 Definitions

In this article, unless the context otherwise requires:

"Criminal conduct" means any act, including all preparatory offenses, in violation of section 13-1103, 13-1104, 13-1105, 13-1202, 13-1203, 13-1204, 13-1208, 13-1304, 13-1404, 13-1405, 13-1406, 13-1410, 13-1417, 13-2314.04, 13-2915, 13-2916, 13-2921, 13-2921.01, 13-3019, 13-3552, 13-3553, 13-3554, 13-3601 or 13-3601.02.
"Discriminatory act" means any direct or indirect act or practice that adversely affects a religious organization, including exclusion, restriction, segregation, limitation, refusal or denial.
"Religious organization" means:

(a) A house of worship.

(b) A religious group, corporation, association, educational institution, ministry, order, society or similar entity, regardless of whether it is integrated or affiliated with a church or other house of worship.

(c) An officer, owner, minister, manager, religious leader, clergyperson or employee of an entity or organization described in this paragraph.

"Religious services" means a meeting or assembly of two or more persons organized by a religious organization for the purpose of worship, training, providing educational services, conducting religious rituals or other activities that are deemed necessary by the religious organization for the exercise of religion.
"State government" means:

(a) This state or a political subdivision of this state.

(b) Any agency of this state or of a political subdivision of this state, including a department, bureau, board, commission, council, court or public institution of higher education.

§ 41-1495.01 Discriminatory action against religious organizations; prohibition

A. State government or any private person who sues under or attempts to enforce a law, rule or regulation that is adopted by this state or a political subdivision of this state may not take any discriminatory action against a religious organization on the basis that the organization:

Is religious.
Operates or seeks to operate during a state of emergency.
Engages in the exercise of religion as protected under the first amendment of the United States Constitution.

B. During a state of emergency, religious services are declared essential services and are deemed necessary and vital to the health and welfare of the public.

C. State government shall allow a religious organization to continue to operate and engage in religious services during the state of emergency to the same or greater extent than state government allows other organizations or businesses that provide essential services that are necessary and vital to the health and welfare of the public to operate.

D. This section does not prohibit state government from requiring religious organizations to comply with neutral health, safety or occupancy requirements that are issued by the state government or the federal government and that apply to all organizations and businesses that provide essential services. State government may not enforce any health, safety or occupancy requirement that imposes a substantial burden on a religious service unless state government demonstrates that applying the burden to the religious service in that particular instance is essential to further a compelling governmental interest and is the least restrictive means of furthering that compelling governmental interest.

§ 41-1495.02 Enforceability

A. A religious organization may assert a violation of this article as a claim against state government in any judicial or administrative proceeding or as a defense in any judicial or administrative proceeding without regard to whether the proceeding is brought by or in the name of state government, any private person or any other party. Notwithstanding any other law, an action under this article may be commenced and relief may be granted in a court of this state, without regard to whether the religious organization commencing the action has sought or exhausted administrative remedies.

B. A religious organization that successfully asserts a claim or defense under this article against state government may recover:

Declaratory relief.
Injunctive relief.
Compensatory damages.
Reasonable attorney fees and costs.
Any other appropriate relief.

C. A religious organization that successfully asserts a claim or defense under this article against a private person not acting in an official capacity may recover only declaratory relief and injunctive relief.

D. Sovereign and governmental immunities to suit and from liability are waived and abolished to the extent of liability established by this article, and a religious organization may sue state government, except state courts, for damages allowed by subsection B of this section.

§ 41-1495.03 Rules of construction

A. This article shall be construed in favor of a broad protection of the free exercise of religion.

B. The protection of the free exercise of religion afforded by this article is in addition to the protections provided under federal law, state law and the constitutions of the United States and Arizona. This article does not preempt or repeal any state or local law that is equally or more protective of the free exercise of religion. This article does not narrow the meaning or application of any state or local law protecting the free exercise of religion.

C. This article applies to all state and local laws and ordinances and the implementation of those laws and ordinances, whether statutory or otherwise and whether adopted before or after September 24, 2022. State laws enacted after September 24, 2022 are subject to this article unless the law explicitly excludes application by reference to this article.

D. If any provision of this article or any application of the provision to any particular person or circumstance is held to be invalid under law, the remainder of this article and the application of its provisions to any other person or circumstance may not be affected.

§ 41-1495.04 Applicability

This article does not apply to a case based on criminal conduct or to a tort action brought by a victim of such criminal conduct against a religious organization or an employee or volunteer of a religious organization, including an action brought pursuant to section 12-514.

Chapter 10 Arizona Commerce Authority

Article 1 General Provisions

§ 41-1501 Definitions

In this chapter, unless the context otherwise requires:

"Authority" means the Arizona commerce authority.
"Board" means the board of directors of the authority.
"Chief executive officer" means the chief executive officer of the authority.
"Direct job" means employment that is in direct connection with the operations or function of a business, facility or target industry, as determined and applied in standard economic modeling practices.
"Indirect job" means employment that is created in the local supply chain that serves a business, facility or target industry, as determined and applied in standard economic modeling practices.
"Induced job" means employment that is created as a result of local spending of the employees of the business, facility or target industry or the employees of suppliers that serves that business, facility or target industry, as determined and applied in standard economic modeling practices.

§ 41-1502 Arizona commerce authority; board of directors; conduct of office; audit

A. The Arizona commerce authority is established. The mission of the authority is to provide private sector leadership in growing and diversifying the economy of this state, creating high quality employment in this state through expansion, attraction and retention of businesses and marketing this state for the purpose of expansion, attraction and retention of businesses.

B. The authority is governed by a board of directors consisting of:

The governor, who serves as chairperson.
The chief executive officer.
Seventeen private sector business leaders who are chief executive officers of private, for-profit enterprises. None of these members may be an elected official of any government entity. These members must be appointed from geographically diverse areas of this state and not all from the same county. These members shall serve staggered three-year terms of office beginning and ending on the third Monday in January. These members shall be appointed as follows:

(a) Nine members who are appointed by the governor.

(b) Four members who are appointed by the president of the senate.

The following as ex officio members without the power to vote:

(a) The president of the senate.

(b) The speaker of the house of representatives.

(d) The president of each state university under the jurisdiction of the Arizona board of regents.

(e) One president of a community college who is appointed by a statewide organization of community college presidents.

(f) The chairperson of the governor's council on small business, or its successor.

(g) The chairperson of the workforce Arizona council established by executive order pursuant to section 41-5401.

(h) One member of the rural business development advisory council established by section 41-1505 who is appointed by the governor.

(i) The president of a statewide organization of incorporated cities and towns who is appointed by the governor.

(j) The president of a statewide organization of county boards of supervisors who is appointed by the governor.

C. For members who are appointed by the governor pursuant to subsection B of this section, before appointment by the governor, a prospective member of the board of directors shall submit a full set of fingerprints to the governor for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

D. The following shall serve as technical advisors to the board to enhance collaboration among state agencies to meet infrastructure needs and facilitate growth opportunities throughout this state:

The director of environmental quality.
The state land commissioner.
The director of the department of revenue.
The director of the office of tourism.
The director of the department of transportation.
The director of water resources.
The director of the department of insurance and financial institutions.
The director of the Arizona-Mexico commission in the governor's office.
The director of the office of economic opportunity.
An attorney who is appointed jointly by the president of the senate and the speaker of the house of representatives and who has experience litigating constitutional cases involving article IX, section 7 of the Arizona Constitution.

E. The governor shall appoint a cochairperson of the board of directors from among the voting members. The board may establish an executive committee consisting of the chairperson, the cochairperson, the chief executive officer and additional voting members of the board elected by the board. The chairperson may appoint subcommittees as necessary.

F. The board may request assistance from representatives of other state agencies to maximize economic development opportunities by leveraging their access to strategic assets and planning processes.

G. Board members serve without compensation but are eligible for reimbursement of expenses pursuant to section 41-1504, subsection E, paragraph 1.

H. A majority of the voting members, which must include the chairperson and the chief executive officer, constitute a quorum for the purpose of an official meeting for conducting business. An affirmative vote of a majority of the members present at an official meeting is sufficient for any action to be taken.

I. The board shall keep and maintain a complete and accurate record of all of its proceedings. Public access to the board's records is subject to section 41-1504, subsection M. The public portion of board meetings shall be recorded. These recordings shall be posted on the authority's website within three business days after the meeting and shall remain on the website pursuant to section 38-431.01, subsection K.

J. The board of directors, executive committee, subcommittees and advisory councils are subject to title 38, chapter 3, article 3.1, relating to public meetings, except as follows:

In addition to section 38-431.03, the board, executive committee and subcommittees may meet in executive session for discussion about potential business development opportunities and strategies that, if made public, could potentially harm the applicant's, the potential applicant's or this state's competitive position.
Social and travel events related to the expansion, attraction and retention of businesses are not public meetings if no legal action involving a final vote or decision is taken.
Activities and events held in public for the purpose of announcing the expansion, attraction and retention of projects are not public meetings.

K. The board and the officers and employees of the authority are subject to title 38, chapter 3, article 8, relating to conflicts of interest.

L. The board of directors shall adopt written policies, procedures and guidelines for standards of conduct, including a gift policy, for members of the board and for officers and employees of the authority.

M. The compensation of all officers and employees is considered a public record pursuant to title 39, chapter 1.

N. The authority shall operate on the state fiscal year. The board shall cause an annual audit to be conducted on or before October 31 of each of the authority's public funds established by this chapter by an independent certified public accountant. The board shall immediately file a certified copy of the audit with the auditor general. The auditor general may make such further audits and examinations as necessary and may take appropriate action relating to the audit or examination pursuant to chapter 7, article 10.1 of this title. If the auditor general takes no further action within thirty days after the audit is filed, the audit is considered to be sufficient.

O. All state agencies shall cooperate with the authority and make available data pertaining to the functions of the authority as requested by the authority.

P. The authority may not have more than one hundred full-time employees, excluding any full-time employees that are funded with monies other than state monies.

§ 41-1503 Chief executive officer

A. The board of directors shall employ a chief executive officer and prescribe the terms and conditions of the chief executive officer's employment. The chief executive officer serves at the pleasure of the board under the terms of a performance based contract.

B. The chief executive officer is responsible for managing, administering and supervising the activities of the authority.

C. The chief executive officer shall negotiate, make, execute, acknowledge and perform contracts and other agreements in the interest of the authority or to carry out or accomplish the purposes of this chapter.

§ 41-1504 Powers and duties; e-verify requirement

A. The board of directors, on behalf of the authority, may:

Adopt and use a corporate seal.
Sue and be sued.
Enter into contracts as necessary to carry out the purposes and requirements of this chapter, including intergovernmental agreements pursuant to title 11, chapter 7, article 3 and interagency service agreements as provided by section 35-148.
Lease real property and improvements to real property for the purposes of the authority. Leases by the authority are exempt from chapter 4, article 7 of this title, relating to management of state properties.
Employ or retain legal counsel and other consultants as necessary to carry out the purposes of the authority.
Develop and use written policies, procedures and guidelines for the terms and conditions of employing officers and employees of the authority and may include background checks of appropriate personnel.

B. The board of directors, on behalf of the authority, shall:

Develop comprehensive long-range strategic economic plans for this state and submit the plans to the governor.
Annually update a strategic economic plan for submission to the governor.
Accept gifts, grants and loans and enter into contracts and other transactions with any federal or state agency, municipality, private organization or other source.

C. The authority shall:

Assess and collect fees for processing applications and administering incentives. The board shall adopt the manner of computing the amount of each fee to be assessed. Within thirty days after proposing fees for adoption, the chief executive officer shall submit a schedule of the fees for review by the joint legislative budget committee. It is the intent of the legislature that a fee shall not exceed one percent of the amount of the incentive.
Determine and collect registry fees for the administration of the allocation of federal tax exempt industrial development bonds and student loan bonds authorized by the authority. Such monies collected by the authority shall be deposited, pursuant to sections 35-146 and 35-147, in an application fees fund. Monies in the fund shall be used, subject to annual appropriation by the legislature, by the authority to administer the allocations provided in this paragraph and are exempt from the provisions of section 35-190 relating to the lapsing of appropriations.
Determine and collect security deposits for the allocation, for the extension of allocations and for the difference between allocations and principal amounts of federal tax exempt industrial development bonds and student loan bonds authorized by the authority. Security deposits forfeited to the authority shall be deposited in the state general fund.
At the direction of the board, establish and supervise the operations of full-time or part-time offices in other states and foreign countries for the purpose of expanding direct investment and export trade opportunities for businesses and industries in this state if, based on objective research, the authority determines that the effort would be beneficial to the economy of this state.
Establish a program by which entrepreneurs become aware of permits, licenses or other authorizations needed to establish, expand or operate in this state.
Post on its website on an annual basis a report that contains at least the following information, and submit a copy to the governor, the president of the senate and the speaker of the house of representatives:

(a) The cumulative progress made toward its goals for direct job creation, capital investment and higher average wages and the estimated number of indirect jobs and induced jobs created as a result of the work and the programs of the authority.

(b) To the extent not prohibited by law, information on each incentive application approved by the authority in the fiscal year, including the amount of the incentive approved or awarded and the applicant's activity that is projected or has been achieved, whichever is applicable, to qualify for the incentive.

(d) Small business outreach and impact data.

Develop and implement written policies and procedures relating to the administration of grants from the Arizona competes fund established by section 41-1545.01, including the following elements:

(a) Procedures for documenting grantee selection and due diligence.

(b) Procedures for verification of information submitted by grantees.

Notwithstanding any other law, on request of the office of economic opportunity, disclose to the office of economic opportunity applicant information for incentives administered, in whole or in part, by the authority. Any confidentiality requirements provided by law applicable to the information disclosed pursuant to this paragraph apply to the office of economic opportunity.
On or before December 31 of each year, compile the data collected pursuant to subsection F of this section and submit a report to the governor, the president of the senate, the speaker of the house of representatives and the secretary of state.

D. The authority, through the chief executive officer, may:

Contract and incur obligations reasonably necessary or desirable within the general scope of the authority's activities and operations to enable the authority to adequately perform its duties.
Use monies, facilities or services to provide matching contributions under federal or other programs that further the objectives and programs of the authority.
Accept gifts, grants, matching monies or direct payments from public or private agencies or private persons and enterprises for the conduct of programs that are consistent with the general purposes and objectives of this chapter.
Assess business fees for promotional services provided to businesses that export products and services from this state. The fees shall not exceed the actual costs of the services provided.
Establish and maintain one or more accounts in banks or other depositories, for public or private monies of the authority, from which operational activities, including payroll, vendor and grant payments, may be conducted. Individual funds that are established by law under the jurisdiction of the authority may be maintained in separate accounts in banks or other depositories, but shall not be commingled with any other monies or funds of the authority.

E. The chief executive officer shall:

Hire employees and prescribe the terms and conditions of their employment as necessary to carry out the purposes of the authority. The board of directors shall adopt written policies, procedures and guidelines, similar to those adopted by the department of administration, regarding officer and employee compensation, observed holidays, leave and reimbursement of travel expenses and health and accident insurance. The officers and employees of the authority are exempt from any laws regulating state employment, including:

(a) Chapter 4, articles 5 and 6 of this title, relating to state service.

(b) Title 38, chapter 4, article 1 and chapter 5, article 2, relating to state personnel compensation, leave and retirement.

(d) Title 38, chapter 4, article 4, relating to health and accident insurance.

Maintain three full-time employees to serve as advocates for small and rural businesses on economic development and regulatory matters before cities, towns, counties or state agencies. Two of the full-time employees shall be dedicated to small business growth, support and regulation, one of whom shall serve as a small business ombudsman. One of the full-time employees shall be dedicated to rural economic development.
On a quarterly basis, provide public record data in a manner prescribed by the department of administration related to the authority's revenues and expenditures for inclusion in the comprehensive database of receipts and expenditures of state monies pursuant to section 41-725.

F. On or before September 30 of each year, each city, town and county in this state shall submit to the authority the city's, town's or county's statistics for the preceding fiscal year that include all of the following:

The average time from the submission of an initial building permit application to a certificate of occupancy.
The average time from the submission of a zoning application to zoning approval.
The average time from the submission of a final plat to the recordation of the final plat.
Any other statistics as determined by the authority or the municipality time frames advisory committee established by section 41-1527 relating to municipal and county support for economic development projects.

G. In addition to any other requirement, in order to qualify for any grant, loan, reimbursement, tax incentive or other economic development incentive pursuant to this chapter, an applicant that is an employer must register with and participate in the e-verify program in compliance with section 23-214. The authority shall require verification of compliance with this subsection as part of any application process.

H. Notwithstanding any other law, the authority is subject to chapter 3.1, article 1 of this title, relating to risk management.

I. The authority is exempt from title 18, chapter 1, articles 1 and 2, relating to statewide information technology. The authority shall adopt policies, procedures and guidelines regarding information technology.

J. The authority is exempt from state general accounting and finance practices and rules adopted pursuant to chapter 4, article 3 of this title, but the board shall adopt written accounting practices, systems and procedures for the economic and efficient operation of the authority. The authority shall adopt policies pursuant to this subsection that prohibit using state monies as defined in section 35-321 to provide business executives lodging, alcoholic beverages, personal transportation or tickets to entertainment events for the purposes of attracting businesses to this state.

K. The authority is exempt from section 41-712, relating to the installation and maintenance of telecommunication systems.

L. The authority may lease or purchase motor vehicles for use by employees to conduct business activities. The authority is exempt from section 28-472, relating to the state motor vehicle fleet, and title 38, chapter 3, article 10, relating to vehicle usage and markings.

M. Any tangible or intangible record submitted to or compiled by the board or the authority in connection with its work, including the award of monies, is subject to title 39, chapter 1, unless an applicant shows, or the board or authority determines, that specific information meets either of the following:

If made public, the information would divulge the applicant's or potential applicant's trade secrets, as defined in section 44-401.
If made public, the information could potentially harm the applicant's, the potential applicant's or this state's competitive position relating to potential business development opportunities and strategies.

N. The authority is exempt from chapter 25, article 1 of this title, relating to government competition with private enterprise.

§ 41-1505 Rural business development advisory council

A. The rural business development advisory council is established. The mission of the council is to advise the board of directors regarding rural business development strategies, including creating jobs, diversifying economies and attracting new investment.

B. The council consists of the following members:

One representative from each county, seven of whom are appointed by the governor and four each of whom are appointed by the president of the senate and the speaker of the house of representatives.
One representative of a rural development organization that represents statewide interests who is appointed by the governor.
One member representing all Indian tribes, nations, bands and communities in this state who is appointed by the governor.
The chief executive officer or the chief executive officer's designee.

C. Each year the governor shall appoint a member to serve as chairperson. The chairperson may be reappointed. Council members shall serve staggered three-year terms beginning and ending on the third Monday in January. The members of the council serve without compensation and are subject to title 38, chapter 3, article 8, relating to conflicts of interest.

D. The council shall:

Recommend to the board of directors policy development and funding allocations to complement regional and local economic development strategies that focus on and assist rural communities.
Leverage local, state and federal resources to advance business in rural areas of this state.
Develop selection criteria and an application format for rural communities or areas to use in applying for matching monies.
Make recommendations for coordinating personnel activities of the authority to ensure that communities receive appropriate technical assistance to implement economic development efforts.
Assist local rural economic development professionals, main street project managers and others involved in economic development.
Make recommendations regarding:

(a) State responsibilities under any necessary contracts with consultants, including the national main street center of the national trust for historic preservation.

(b) Coordination of the activities of other state agency personnel assisting with rural economic development programs.

Monitor the progress of main street communities and other aspects of the program.
Coordinate the expenditure of available federal monies to support rural business and economic development programs.

E. Each year the council shall develop a priority list of economic strength projects that meet the criteria established by section 28-7281 and submit the list to the chief executive officer. The council shall confer with regional planning agencies and local authorities that would be affected by a specific economic strength project and shall submit their comments to the chief executive officer. After review by the board, the chief executive officer shall transmit the priority list and comments to the state transportation board. The council shall set priorities for individual projects based on the following:

The cost of the project.
The number of jobs that the project will cause to be created, retained or increased.
The nature and amount of capital investment or other contribution to the economy of this state or a local authority as a result of the project.
The likelihood that benefits resulting from the project will exceed the costs of the project.
Whether the amount of contributions to the project provided from other than the economic strength project fund is at least ten percent of the cost of the project.
The amount and percentage of funding for the project that will come from a source other than the economic strength project fund as compared to other proposed projects.
The amount of expenditures required for local infrastructure relating to the project.
The magnitude of the project and its relative value to this state or a local authority as compared to other proposed projects.
The extent to which the project would contribute to achieving an equitable distribution of monies and projects among the various regions of this state and throughout this state as a whole.
The specific time schedule for completion of the project.

§ 41-1505.12 Arizona commerce authority local communities fund

(Caution: 1998 Prop 105 applies)

A. The Arizona commerce authority local communities fund is established consisting of monies deposited pursuant to sections 5-601.02(H)(4)(b) and 5-601.02(I)(6)(b)(vii), and interest earned on those monies. The chief executive officer shall administer the fund. The fund is not subject to appropriation, and expenditures from the fund are not subject to outside approval notwithstanding any statutory provision to the contrary.

B. Monies received pursuant to sections 5-601.02(H)(4)(b) and 5-601.02(I)(6)(b)(vii) shall be deposited directly with the Arizona commerce authority local communities fund. On notice from the chief executive officer, the state treasurer may invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. No monies in the fund shall revert to or be deposited in any other fund, including the state general fund. Monies in the fund are exempt from the provisions of section 35-190 relating to the lapsing of appropriations. Monies provided from the fund shall supplement, not supplant, existing monies.

C. All monies in the fund shall be used by the authority to provide grants to cities, towns and counties for government services that benefit the general public, including public safety, mitigation of impacts of gaming, or promotion of commerce and economic development. All grant applications must have a written endorsement of a nearby Indian tribe to receive an award of funds from the authority.

§ 41-1506 Arizona commerce authority fund

A. The Arizona commerce authority fund is established consisting of:

Withholding tax revenues allocated to the fund from the job creation withholdings clearing account pursuant to section 43-409, subsection B, paragraph 1. Monies credited to the fund may be deposited in the state treasury or in a bank or other depository approved by the board of directors pursuant to section 41-1504, subsection D, paragraph 5.
Monies deposited pursuant to section 18-603.

B. The chief executive officer shall administer the fund. On notice from the chief executive officer, the state treasurer shall invest and divest any monies in the fund deposited in the state treasury as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

C. The chief executive officer shall use the monies in the fund as follows:

Monies described in subsection A, paragraph 1 of this section shall be used exclusively for the purposes of this chapter without further legislative authorization.
Monies described in subsection A, paragraph 2 of this section shall be used exclusively for the purposes of title 18, chapter 6.

§ 41-1506.01 Arizona twenty-first century competitive initiative fund

A. The Arizona twenty-first century competitive initiative fund is established to be administered by the authority. The fund consists of monies appropriated by the legislature, earnings from the fund and gifts or grants donated or given to the fund. Monies in the fund are subject to legislative appropriation and shall be used as prescribed by this section.

B. On notice from the chief executive officer, the state treasurer may invest and divest monies in the fund as provided by section 35-313. The state treasurer shall credit monies earned from investments to the fund.

C. The chief executive officer shall enter into a memorandum of understanding with a nonprofit corporation to use monies in the fund in order to:

Build and strengthen medical, scientific and engineering research programs and infrastructure in areas of greatest strategic value to this state's competitiveness in the global economy with an emphasis in bioscience.
Actively engage scientific research, academic and medical institutions that represent both the public and private sectors on a worldwide basis.

D. In order to enter into a memorandum of understanding pursuant to subsection C of this section, a nonprofit corporation shall:

Be a statewide nonprofit corporation that is incorporated in this state and that is qualified under section 501(c)(3) of the United States internal revenue code.
Agree on a quarterly basis to report on investments made and agree on an annual basis to report on measurable objectives and other funds leveraged with state investments.
Identify and document private or philanthropic investments that are equivalent to fifty million dollars or more in fiscal year 2005-2006. For fiscal year 2006-2007, the nonprofit corporation shall provide funding to achieve the goals prescribed in subsection C of this section in an amount equal to or greater than the financial assistance provided by this state.

E. The chief executive officer shall submit the memorandum of understanding with the nonprofit corporation to the joint legislative budget committee for review before expending any appropriated state monies. The initial submission shall include provisions that address how the nonprofit corporation accounts for the application and investment of monies pursuant to subsection C of this section, the documentation of investments made in whole or in part through funding pursuant to this section and the preparation and filing of annual audits of the fund with the auditor general. The initial submission shall also include performance measures to evaluate the effectiveness of the program and recommendations pertaining to prospective repayment to the fund by scientific, research, academic and medical institutions of a portion of the income derived from technology or intellectual property created or developed in whole or in part through funding pursuant to this section. The joint legislative budget committee shall review expenditures from the fund at least quarterly, including any changes to the memorandum of understanding, but may choose less frequent reviews.

§ 41-1506.02 Major events fund; purpose; semiannual report

A. The major events fund is established consisting of monies appropriated to the fund by the legislature and private donations. The authority shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. Monies in the fund may be used:

To support the planning and operation of the competitive bid process for major events in coordination with the office of tourism, destination marketing organizations and local organizing committees.
To negotiate and make grants to local organizing committees or equivalent organizations for the operating costs of major events. Monies may not be used to supplant routine operating expenses of any political subdivision of this state. The grant for an event may not be more than twenty-five percent of the operating expenditures required under the event support contract between the host organization and the local organizing committee or equivalent organization.
For other economic development activities associated with major event operations.

B. Before awarding a grant pursuant to subsection A, paragraph 2 of this section, the authority shall prepare a written statement signed by the chief executive officer that assesses the direct economic impact of the grant and contains a finding that the award of the grant is in the best interest of this state.

C. The authority shall submit a semiannual report to the joint legislative budget committee and the governor's office of strategic planning and budgeting on or before July 15 and December 15 of each year. Each report shall include, at a minimum, the amount of actual expenditures from the fund by purpose and an expenditure plan for all remaining monies by purpose.

§ 41-1506.03 Made in Arizona special plate fund

A. The made in Arizona special plate fund is established consisting of monies deposited pursuant to section 28-2470.29. The fund shall be administered by the authority. The first $32,000 in the fund shall be reimbursed to the person that paid the implementation fee to the department of transportation pursuant to section 28-2470.29. Not more than ten percent of the monies deposited in the fund annually shall be used for the cost of administering the fund. Monies in the fund are continuously appropriated.

B. On notice from the chief executive officer, the state treasurer may invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. The chief executive officer shall annually allocate monies from the fund to support a program that does both of the following:

Advances workforce development in this state in the advanced manufacturing industry.
Fosters collaboration with community colleges located in this state and the advanced manufacturing industry.

§ 41-1507 Tax credit for increased research activity; qualification for refund

A. The authority shall receive applications and evaluate and certify taxpayers who otherwise qualify for income tax credits for increased research activities to further qualify for income tax refunds.

B. An application for a refund of the taxpayer's credit must include:

The taxpayer's name, address and taxpayer identification number and a telephone number and e-mail address of a person responsible for the application.
A general description of the taxpayer's business and the research activities conducted by the taxpayer.
The number of full-time employees on the taxpayer's payroll on the last day of the taxpayer's taxable year. Only taxpayers employing fewer than one hundred fifty full-time employees qualify for a refund of the taxpayer's income tax credit.
The amount of the taxpayer's income tax credit for the taxable year.
Any other information required by the authority.

C. Each application shall include a processing fee equal to one per cent of the taxpayer's tax credit being refunded.

D. The authority shall process and evaluate each application and within thirty days after receiving the application either:

Issue to the applicant a certificate of qualification for the refund.
Notify the applicant of denial of the application with specific reasons for the denial. A denial of the application does not preclude a subsequent application if the applicant is able to correct any error or deficiency.

E. The authority shall not approve refunds exceeding a total of five million dollars in any calendar year. Refunds are allowed on a first come, first served basis, according to the date of application. An approved amount applies against the dollar limit for the year in which the application was submitted. If, at the end of any year, an unused balance occurs under the dollar limit prescribed by this subsection, the balance shall be reallocated for the purposes of this section in the following year.

F. The authority, with the cooperation of the department of revenue, shall adopt rules and publish and prescribe forms and procedures as necessary to effectuate the purposes of this section.

§ 41-1507.01 Certification of basic research payments to a university

A. For taxable years beginning from and after December 31, 2014, before a taxpayer can apply to the department of revenue for certification of additional income tax credits for increased research activities involving basic research payments to a university under section 43-1074.01, subsection A, paragraph 1, subdivision (c) or section 43-1168, subsection A, paragraph 1, subdivision (d), a taxpayer shall obtain certification from the authority that the basic research payments meet the requirements of this section. The taxpayer shall apply to the authority for certification of the basic research payments at a time, on a form and in a manner prescribed by the authority.

B. The authority shall process and evaluate each application for certification of basic research payments to a university up to an amount that corresponds to ten million dollars per calendar year in aggregate combined projected additional tax credits under section 43-1074.01, subsection A, paragraph 1, subdivision (c) and section 43-1168, subsection A, paragraph 1, subdivision (d). The applicant shall identify the amount of projected additional tax credits corresponding to the basic research payments to a university sought to be certified. The amount of additional tax credits a taxpayer may claim following certification by the authority must be established by the department of revenue under section 43-1074.01, subsection A, paragraph 1, subdivision (c) or section 43-1168, subsection A, paragraph 1, subdivision (d). The authority shall process and evaluate applications for certification under this section through a competitive process pursuant to subsection C of this section that may include third-party peer review. An application for certification must include:

The taxpayer's name, address and taxpayer identification number and a telephone number and e-mail address of a person responsible for the application.
A general description of the taxpayer's business and the research activities contemplated by the taxpayer.
The amount of the additional income tax credit the taxpayer will be requesting from the department of revenue.
Any other information required by the authority.

C. The authority shall establish the time and manner of the competitive process used in issuing certifications. In determining which applications must be issued certifications, the authority or its designee shall evaluate among all applicants for certification of basic research payments, the relative impact of the research activities involving payments to a university from the standpoint of furthering one or more of the following considerations:

Expanding cluster industries. For purposes of this paragraph, "cluster industries" means concentrations of firms across several industries that share common economic foundation needs.
Diversifying and strengthening this state's economy.
Advancing technological commercialization.
Enhancing long-term quality job creation.
Aligning research with university strategic plans.

D. Following review of each application pursuant to subsection C of this section, the authority shall either:

Issue the applicant a letter certifying the basic research payments.
Notify the applicant of the denial of the certification with an explanation of the basis for the denial.

E. The authority shall adopt rules and publish and prescribe forms and procedures as necessary to effectuate the purposes of this section.

F. Any information gathered from a business for the purposes of this section is confidential and may not be disclosed to the public except that the information must be transmitted to the department of revenue.

§ 41-1508 Defense contractor restructuring assistance; definitions

A. On July 1, 2011, the Arizona commerce authority succeeds to the remaining functions and responsibilities formerly performed by the department of commerce under this section. Any reference to department in this section is considered to refer to the Arizona commerce authority.

B. The department shall establish and conduct a defense contractor restructuring assistance program to:

Assist qualified defense contractors in this state to maintain and attract the maximum share of available contracts with the United States department of defense.
Encourage qualified defense contractors in this state to diversify into commercial markets and consolidate facilities into this state.
Encourage qualified defense contractors in this state to adopt new manufacturing processes and technologies.

C. The department shall coordinate a coalition of qualified defense contractors in this state to identify and address relevant issues and opportunities and to increase communication and the capacity to solve common problems.

D. Until June 30, 2001, the department of commerce shall identify and certify to the department of revenue the names and relevant information relating to qualified defense contractors for purposes of available tax incentives. The department of commerce shall determine the effective date of certification, which in all events shall begin on the first day of a taxable year of a taxpayer, and the certification is valid only for five full consecutive calendar or fiscal years, as determined by the department of commerce. The department of commerce may revoke the certification for failure to qualify and comply with the terms and conditions prescribed by this section and shall immediately notify the department of revenue of a revocation. The department of revenue may also revoke the certification if it obtains information indicating a failure to qualify and comply. The department shall not certify any new qualified defense contractor after June 30, 2001. To obtain and maintain certification, a defense contractor must:

Apply to the department of commerce.
Submit and retain copies of all required information including information relating to the amount of tax benefits the defense contractor receives.
Allow such inspections and audits as are necessary to verify the accuracy of the submitted information.
Agree in writing with the department of commerce to furnish information relating to the amount of tax benefits the taxpayer receives each year for disclosure in composite form in an annual report by the department of commerce.

E. For purposes of this section, "qualified defense contractor" or "contractor" means a business entity that on initial qualification meets all of the following requirements:

Has one or more current manufacturing, assembling, fabricating, research, development or design contracts directly with the United States department of defense that:

(a) Total at least five million dollars in sales of tangible personal property manufactured, assembled, fabricated, researched, developed or designed in this state.

(b) Do not require providing products or services directly to a particular military base or bases or installations.

Employs at least two hundred full-time equivalent employee positions in this state solely with respect to department of defense contracts.

§ 41-1509 Career landscape information collection; distribution; posting; definitions

A. The authority shall annually collect and compile all of the following information:

The most in-demand jobs in this state, including the starting salary and required education level for each of these jobs.
The average cost to attend each of the following:

(a) Each university under the jurisdiction of the Arizona board of regents.

(b) Community colleges.

(d) Private postsecondary institutions as data is readily available through the U.S. department of education.

The lowest to highest median monthly student loan payment among undergraduate fields of study for individuals who attended each of the following:

(a) Each university under the jurisdiction of the Arizona board of regents.

(b) Community colleges.

(d) Private postsecondary institutions as data is readily available through the U.S. department of education.

The three-year student loan default rate of individuals who attended each of the following:

(a) Each university under the jurisdiction of the Arizona board of regents.

(b) Community colleges.

(d) Private postsecondary institutions as data is readily available through the U.S. department of education.

The graduation rate for each of the following:

(a) Each university under the jurisdiction of the Arizona board of regents.

(b) Community colleges.

(d) Private postsecondary institutions as data is readily available through the U.S. department of education.

The completion rates for all of the following:

(a) Department of economic security-approved and United States department of labor-approved apprenticeship programs, as collected by the department of economic security.

(b) High school equivalency programs in this state.

The lowest to highest median starting earnings among undergraduate fields of study for individuals who graduated from each of the following:

(a) Each university under the jurisdiction of the Arizona board of regents.

(b) Community colleges.

(d) Private postsecondary institutions as data is readily available through the U.S. department of education.

B. Not later than December 1 of each year, the authority shall transmit the information collected and compiled pursuant to subsection A of this section to each public high school in this state to distribute to students.

C. All state agencies, universities under the jurisdiction of the Arizona board of regents, community colleges, vocational programs and private postsecondary institutions shall provide data, reports and other information as requested by the authority to fulfill the requirements of this section.

D. Not later than October 1 of each year, all state agencies, universities under the jurisdiction of the Arizona board of regents, community colleges, vocational programs and private postsecondary institutions shall provide the data, reports and other information necessary to fulfill the requirements of this section to the authority.

E. The authority shall make the information collected and compiled pursuant to subsection A of this section publicly available and shall post this information on its website.

F. For the purposes of this section:

"Community college" has the same meaning prescribed in section 15-1401.
"Vocational program" has the same meaning prescribed in section 15-1831.

§ 41-1510 Water infrastructure and commerce grant fund

A. The water infrastructure and commerce grant fund is established consisting of legislative appropriations, federal monies and private donations. The chief executive officer shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. Monies in the fund may be used to provide grants to eligible entities for contracting for the design and construction of water infrastructure at the eligible entity's location. The authority may retain up to one percent of the monies in the fund annually to administer the fund.

B. The following entities are eligible to apply for and receive grant monies pursuant to this section:

A public service corporation that provides water service pursuant to a certificate of convenience and necessity issued by the corporation commission and that is acting on behalf of an employer prescribed in paragraph 2 of this subsection.
An employer with more than two hundred fifty employees that is located in a county with a population of more than four hundred thousand persons and less than one million persons.

C. The authority shall:

Prescribe a simplified form and procedure to apply for and approve grants.
Establish requirements and criteria by which grants will be awarded, which shall include at least the following:

(a) Grants to eligible applicants only for new water infrastructure projects that are located at the eligible applicant's property in a county with a population of more than four hundred thousand persons and less than one million persons.

(b) Grants for projects that create new jobs.

(d) Grants that are allocated and distributed not later than December 31, 2024.

(e) Applicants may receive more favorable consideration for grant monies if the applicant includes collaboration and cooperation with other members and entities in the community.

(f) Applicants shall certify that they are eligible to receive grant monies, shall describe the project and services requested and why the project and services are needed and shall certify that all grant monies will be used in compliance with this section, the authority's requirements, the application requirements and processes and otherwise applicable law.

D. Before awarding a grant pursuant to this section, the authority shall prepare a written statement that is signed by the chief executive officer, that assesses the direct economic impact of the grant, including the number of new jobs that will be created, and that contains a finding that the award of grant monies is in the best interest of this state.

E. On or before December 15 of each year, the authority shall submit an annual report to the joint legislative budget committee. The report shall include, at a minimum, the amount of actual expenditures from the fund by project and an expenditure plan for all remaining monies by project.

§ 41-1510.01 Solar energy tax incentives; qualification

A. The authority shall establish a procedure for identifying commercial solar energy projects that qualify for the purposes of the commercial solar energy income tax credits under sections 43-1085 and 43-1164.

B. To qualify for the tax credits, a business must apply in a form prescribed by the authority, including:

The name, address and telephone number of the business purchasing the solar energy device or system.
The name, address and telephone number of a contact person with the business.
The projected date that the installation of the solar energy device or system will begin and the projected finish date.
The location where the solar energy device or system will be installed.
The type of solar energy device or system, its total cost, excluding financing costs, and the estimated annual performance level.
The projected amount of the credit against state income taxes.

C. Applications under this section are confidential and are not subject to disclosure under title 39 for eighteen months after the date of application.

D. The authority shall:

Establish a preapproval process for the certification of applications.
Review and evaluate each submitted application.
Determine within thirty days after receiving the application whether the application meets the criteria for the purposes of the commercial solar energy income tax credits.
Provide its initial certification of a project to the applicant and to the department of revenue. The initial certification shall include a unique identifying number for each certified installation.

E. On the completion of each certified installation:

The business must:

(a) Certify that the installed solar energy device or system is operational.

(b) Provide the total amount of income tax credits to be claimed.

The authority shall review the installation expenses and issue a credit certificate to the business. The credit certificate shall include the assigned identifying number.
The authority shall transmit the credit information and certificate number to the department of revenue.

F. The authority shall not certify tax credits under this section in any calendar year that exceed a total of one million dollars. The total allowed under this section shall be reserved for the taxpayer based on preapproval under subsection D of this section. The final credit certificate issued under subsection E of this section shall not exceed the amount reserved. A taxpayer whose taxable year overlaps two calendar years may request approval from the second calendar year's cap if the first year's cap is exhausted and the application under subsection B of this section is submitted before the end of the taxpayer's taxable year. Nothing in this section shall be construed as allowing the taxpayer to claim credits under sections 43-1085 and 43-1164 in any taxable year other than the taxable year the solar energy device was installed.

G. The authority and the department of revenue shall collaborate in adopting rules that are necessary to accomplish the intent and purpose of this section.

§ 41-1511 State broadband office; director; duties

A. The state broadband office is established in the authority.

B. The state broadband office consists of the state broadband director, who serves at the pleasure of the chief executive officer. The chief executive officer may hire staff for the state broadband office to do the following:

Coordinate the implementation of local, state and federal broadband programs.
Coordinate and execute federal broadband grant applications with public and private stakeholders.
Provide guidance and support to stakeholders in navigating local, state and federal regulatory and permitting processes for broadband infrastructure projects.
Provide guidance and support to local and state public and private partners on federal, state and local broadband policies and practices.
Solicit feedback from stakeholders to develop long-term local, state and federal broadband policy priorities that may influence local, state and federal broadband policies and programs.
Work with local partners, state and federal agencies and telecommunication providers to develop plans to improve internet connectivity and resiliency in this state.

C. The state broadband office shall publish and maintain a state broadband plan that further elaborates on the strategies and tactics to achieve this state's broadband goals.

D. The state broadband office may develop rules and guidelines to implement this section.

§ 41-1512 Qualified facility income tax credits; qualification; definitions

(Rpld. 1/1/32)

A. For taxable years beginning from and after December 31, 2012, income tax credits are allowed for expanding or locating a qualified facility in this state pursuant to sections 43-1083.03 and 43-1164.04. Only capital investments in a qualified facility that are made not more than thirty-six months before submitting an application for preapproval are included in the computation of the credit.

B. To be eligible for the income tax credits, a taxpayer must apply to the authority, on a form prescribed by the authority, for preapproval of the business as qualifying for the credits. The application must include:

The applicant's name, address, telephone number and federal taxpayer identification number or numbers.
The name, address, telephone number and email address of a contact person for the applicant.
The address of the site where the qualified facility will be located.
A detailed description of the qualified facility and fixed capital assets.
An estimate of the capital investment and number of employment positions with job duties associated with the qualified facility, including:

(a) A schedule of qualifying investments.

(b) A list of full-time employment positions, the estimated number of employees to be hired for the positions each year during the first five years of operation and the annual wages for each position, calculated without employee-related benefits.

A nonrefundable processing fee in an amount determined by the authority.
Other information as required by the authority to determine eligibility for the income tax credits and the amount of income tax credits, as prescribed by this section.
An affirmation, signed by an authorized executive representing the business, that the applicant:

(a) Agrees to furnish records of expenditures for qualifying investments to the authority on request.

(b) Will continue in business at the qualified facility for five full calendar years after postapproval for the credit, other than for reasons beyond the control of the applicant.

(d) Authorizes the department of revenue to provide tax information to the authority pursuant to section 42-2003 for the purpose of determining any inconsistency in information furnished by the applicant.

(e) Agrees to allow site visits and audits to verify the applicant's continuing qualification and the accuracy of information submitted to the authority.

(f) Consents to the adjustment or recapture of any amount of income tax credit due to noncompliance with this section.

Letters of good standing from the department of revenue stating that the applicant is not delinquent in paying taxes.

C. The applicant may qualify for the income tax credits pursuant to section 43-1083.03 or 43-1164.04, as applicable, if:

The applicant makes new capital investment in this state after June 30, 2012 in a qualified facility that is completed in a taxable year beginning from and after December 31, 2012.
At least fifty-one percent of the net new full-time employment positions with job duties associated with the qualified facility pay a wage that equals or exceeds one hundred twenty-five percent, or one hundred percent in the case of a qualified facility in a rural location, of the median annual wage for production occupations in this state, as determined by the most recent annual Arizona commerce authority occupational wage and employment estimates issued before the preapproval is issued pursuant to subsection I of this section.
All net new full-time employment positions include health insurance coverage for the employees for which the applicant pays at least sixty-five percent of the premium or membership cost.

D. Final eligibility for an income tax credit is subject to any additional requirements prescribed by section 43-1083.03 or 43-1164.04, as applicable.

E. An applicant may separately apply and qualify with respect to investments for separate expansions of a qualified facility.

F. The amount of the income tax credit to be preapproved by the authority to a qualifying applicant is ten percent of the lesser of:

The amount the applicant has projected in total qualifying investment in the qualified facility.
Either:

(a) If the total qualifying investment is less than $2,000,000,000, $200,000 for each net new full-time employment position projected by the applicant that has job duties associated with a qualified facility.

(b) If the total qualifying investment is $2,000,000,000 or more, $300,000 for each net new full-time employment position projected by the applicant that has job duties associated with a qualified facility.

G. Beginning with income tax credits allocated for 2013, an approved credit:

Must be claimed on a timely filed original income tax return, including extensions.
Must be claimed in five equal installments as provided by section 43-1083.03 or 43-1164.04.

H. The authority shall establish a process for qualifying and preapproving applicants for the income tax credits. The authority shall not preapprove applicants as qualifying for credits under this section for any taxable year beginning from and after December 31, 2030. Preapproval is based on:

Priority placement established by the date that the applicant files its initial application with the authority.
The availability of income tax credit capacity under the dollar limit prescribed by subsection J of this section.

I. Within thirty days after receiving a complete and correct application, the authority shall review the application to determine whether the applicant satisfies all of the criteria prescribed by this section and either preapprove the project as qualifying for the purposes of an income tax credit or provide reasons for its denial. The authority shall send copies of each preapproval to the department of revenue.

J. The authority shall not preapprove income tax credits under this section that combined would exceed $125,000,000 in any calendar year, except as provided by this subsection and subsection K of this section. A preapproved amount applies against the dollar limit for the year in which the application was submitted regardless of whether the initial preapproval period extends into the following year or years. The authority shall not preapprove income tax credits under this section for any taxpayer in excess of $30,000,000 in any calendar year.

K. The authority shall reallocate the amount of income tax credits that are voluntarily relinquished under subsection L of this section, that lapse under subsection M of this section or that lapse under subsection P of this section. The reallocation shall be to other businesses that applied under this section in the original credit year based on priority placement. Once reallocated, the amount of the credit applies against the dollar limit of the original credit year regardless of the year in which the reallocation occurs.

L. A taxpayer may voluntarily relinquish unused credit amounts in writing to the authority.

M. Preapproval under this section lapses, the application is void and the amount of the preapproved income tax credits does not apply against the dollar limit prescribed by subsection J of this section if, within twelve months after preapproval, the business fails to provide to the authority documentation of its expenditure of $250,000 in qualifying investment or, if the period over which the qualifying investment will be made exceeds twelve months, documentation of additional expenditures as required in this subsection for each twelve-month period.

N. After October 31 of each year, if the authority has preapproved the maximum calendar year income tax credit amount pursuant to subsection J of this section, the authority may accept initial applications for the next calendar year, but the preapproval of any application pursuant to this subsection shall not be effective before the first business day of the following calendar year.

O. Before an applicant applies for postapproval under subsection P of this section, the applicant must enter into a written managed review agreement with the chief executive officer of the authority that establishes the requirements of a managed review to be conducted under this subsection at the applicant's expense. The managed review must be conducted by a certified public accountant who is selected by the applicant, who is licensed in this state or who has a limited reciprocity privilege pursuant to section 32-725 and who is approved by the chief executive officer. The certified public accountant and the firm the certified public accountant is affiliated with shall not regularly perform services for the applicant or its affiliates. The managed review shall include an analysis of the applicant's invoices, checks, accounting records and other documents and information to verify its base investment and other requirements prescribed by section 43-1083.03 or 43-1164.04 to confirm the amount of credit. The certified public accountant shall furnish written findings of the managed review to the chief executive officer. The chief executive officer shall review the findings and may examine records and perform other reviews that the chief executive officer considers necessary to verify that the managed review substantially conforms to the terms of the managed review agreement. The chief executive officer shall accept or reject the findings of the managed review. If the chief executive officer rejects all or part of the managed review, the chief executive officer shall provide written reasons for the rejection.

P. When the qualified facility begins operations, a business that was preapproved for income tax credits under this section shall apply to the authority in writing for postapproval of the credits and submit documentation certifying the total amount and dates of the qualifying investments and identifying the fixed capital assets associated with the qualified facility incurred after June 30, 2012 through the date of application for postapproval. For taxable years beginning from and after December 31, 2012, the authority shall provide postapproval to a business that has met the eligibility requirements of this section and shall notify the department of revenue that the business may claim an income tax credit pursuant to section 43-1083.03 or 43-1164.04. If the amount of qualifying investment actually spent is less than the amount preapproved for income tax credits, the preapproved amount not incurred lapses and does not apply against the dollar limit prescribed by subsection J of this section for that year. The department of revenue shall not allow an income tax credit under section 43-1083.03 or 43-1164.04 that exceeds the amount of the postapproval for the project under this subsection. For the purposes of this subsection, "begins operations" means the qualified facility opens for public business.

Q. The authority may rescind an applicant's postapproval if the business no longer meets the terms and conditions required for qualifying for the credit. The authority may give special consideration, or allow temporary exemption from recapture of the credit, in the case of extraordinary hardship due to factors beyond the control of the qualifying business.

R. If the authority rescinds an applicant's preapproval or postapproval under subsection Q of this section, the authority shall notify the department of revenue of the action and the conditions of noncompliance. If the department of revenue obtains information indicating a possible failure to qualify and comply, the department shall provide that information to the authority. The department of revenue may require the business to file appropriate amended tax returns reflecting any recapture of the credit under section 43-1083.03 or 43-1164.04.

S. Preapproval and postapproval of an applicant for the purposes of income tax credits under this section do not constitute or imply compliance with any other provision of law or any regulatory rule, order, procedure, permit or other measure required by law. To maintain qualification for a credit under this section, a business must separately comply with all environmental, employment and other regulatory measures.

T. For five years after postapproval of an income tax credit under this section, in any action involving the liquidation of the business assets or relocation out of state, this state claims the position of a secured creditor of the business in the amount of the credit the business received pursuant to section 43-1083.03 or 43-1164.04. The transfer of part or all of a company's assets that are then leased back by the company is not considered a liquidation under this section.

U. Any information gathered from a business for the purposes of this section is considered to be confidential taxpayer information and shall be disclosed only as provided in section 42-2003, subsection B, paragraph 12, except that the authority shall publish the following information in its annual report:

The name of each business and the amount of income tax credits preapproved for each qualifying investment.
The amount of income tax credits postapproved with respect to each qualifying investment.

V. The authority shall:

Keep annual records of the information provided on applications for qualified facilities. These records shall reflect a percentage comparison of the annual amount of monies credited to qualified facilities to the estimated amount of monies spent in this state in the form of qualifying investments.
Maintain annual data on growth in this state of qualified facilities and related employment and wages.
Not later than April 30 following each calendar year, prepare and publish a report summarizing the information collected pursuant to this subsection. The authority shall make copies of the annual report available to the public on request.

W. The authority shall adopt rules and prescribe forms and procedures as necessary for the purposes of this section. The authority and the department of revenue shall collaborate in adopting rules as necessary to avoid duplication and inconsistencies while accomplishing the intent and purposes of this section.

X. For the purposes of this section:

"Capital investment" means an expenditure to acquire, lease or improve property that is used in operating a business, including land, buildings, machinery, equipment and fixtures.
"Facility" means a single parcel or contiguous parcels of owned or leased land in this state, the structures and personal property contained on the land or any part of the structures occupied by the owner. Parcels that are separated only by a public thoroughfare or right-of-way are considered to be contiguous.
"Headquarters" means a principal central administrative office where primary headquarters related functions and services are performed, including financial, personnel, administrative, legal, planning and similar business functions.
"Manufacturing" means fabricating, producing or manufacturing raw or prepared materials into usable products, imparting new forms, qualities, properties and combinations. Manufacturing does not include generating electricity.
"Qualified facility" means a facility in this state that devotes at least eighty percent of the property and payroll at the facility to one or more of the following:

(a) Qualified manufacturing.

(b) Qualified headquarters.

"Qualified headquarters" means a global, national or regional headquarters for a taxpayer that derives at least sixty-five percent of its revenue from out-of-state sales.
"Qualified manufacturing" means manufacturing tangible products in this state if at least sixty-five percent of the product is at least one of the following:

(a) Directly sold out of state.

(b) Directly sold to one or more qualified facilities, regardless of whether the qualified facilities are preapproved by the authority pursuant to this section.

"Qualified research" has the same meaning prescribed by section 41(d) of the internal revenue code, as defined by section 43-105, except that the research must be conducted by a taxpayer involved in manufacturing that derives at least sixty-five percent of its revenue from out-of-state sales.
"Qualifying investment" means investment in land, buildings, machinery, equipment and fixtures for expansion of an existing qualified facility or establishment of a new qualified facility in this state after June 30, 2012 for a facility completed in a taxable year beginning from and after December 31, 2012. If the qualified facility is a build-to-suit facility leased to the taxpayer, qualifying investment includes the costs prescribed in this paragraph that are spent by the third-party developer with respect to the qualified facility. Qualifying investment does not include relocating an existing qualified facility in this state to another location in this state without additional capital investment of at least $250,000.
"Rural location" means a location that is within the boundaries of tribal lands or a city or town with a population of less than fifty thousand persons or a county with a population of less than eight hundred thousand persons.

§ 41-1514.02 Environmental technology assistance; definitions

B. The department of commerce shall establish and conduct an environmental technology assistance program to promote business and economic development by recruiting and expanding companies that manufacture, produce or process solar and other renewable energy products or products from recycled materials under the conditions prescribed by this section. The department shall:

Assist qualified environmental technology manufacturers, producers or processors in locating or expanding facilities in this state.
Encourage the use of environmental technology products.
Encourage the development of an environmental technology industry in this state.

C. Until June 30, 1996, the department of commerce shall identify and certify to the department of revenue the names and relevant information relating to the facilities of qualified environmental technology manufacturers, producers and processors for purposes of available tax incentives. The department of commerce may revoke the certification for failure to qualify and comply with the terms and conditions prescribed by this section and shall immediately notify the department of revenue of a revocation. The department of revenue may also revoke the certification if it obtains information indicating a failure to qualify and comply. If the department of revenue proposes to revoke the certification of an environmental technology manufacturer, producer or processor, it shall afford that person the rights of appeal as provided in title 42, chapter 1, article 6. The department of commerce shall not certify any new qualified environmental technology manufacturers, producers or processors for the purposes of this section after June 30, 1996. To obtain and maintain certification, an environmental technology manufacturer, producer or processor must:

Apply to the department of commerce.
Submit and retain copies of all required information including information relating to the actual or projected number of employees at qualified environmental technology facilities in this state and the actual or projected annual capital investment in those facilities.
Allow such inspections and audits as are necessary to verify the accuracy of the submitted information.
On initial application, submit to the department of commerce the information required by section 49-109, subsection B in the manner prescribed in section 49-109, subsection C or the information required by section 49-109, subsection G, as applicable. The department of commerce shall consider the information submitted pursuant to this paragraph in its determination of certification and may deny certification if after consultation with the department of environmental quality serious, substantial and continuing violations of federal or state environmental laws are found.

D. Within sixty days after receipt of a complete application and all information required, as prescribed by the department of commerce, the department of commerce shall grant or deny certification and give written notice by certified mail to the applicant. The applicant is certified as a qualified environmental technology manufacturer, producer or processor on the date the notice of certification is delivered to the applicant.

E. To qualify for assistance under this section, an environmental technology manufacturer, producer or processor must meet the following requirements:

A manufacturer, producer or processor that is certified not later than July 1, 1995 by the department of commerce pursuant to this section, shall not import hazardous waste, as defined in section 49-921 as of July 1, 1993, or special waste, as defined in section 49-851 as of July 1, 1993, into this state from another state or country. Any other manufacturer, producer or processor that is certified by the department of commerce pursuant to this section, after July 1, 1995, shall not as of the date of certification import hazardous waste, as defined in section 49-921, and as interpreted by federal and state regulations or special waste, as defined in section 49-851, into this state from another state or country. This paragraph does not apply to any environmental technology manufacturer, producer or processor, or facilities and their subsequent expansions and replacements that, as of July 1, 1993, hold a storage or treatment facility permit issued by the department of environmental quality pursuant to 40 Code of Federal Regulations section 270.10 or has obtained plan approval from the department of environmental quality pursuant to section 49-762, that specifically authorizes the acceptance of special waste, for an existing or proposed recycling operation, or import hazardous or special wastes for recycling purposes.
The manufacturer, producer or processor shall locate or make an additional capital investment in a facility in this state that:

(a) Is either owned by a qualified environmental technology manufacturer, producer or processor, or leased by a qualified environmental technology manufacturer, producer or processor for a term of five or more years.

(b) Is used predominantly to do any of the following:

(i) Sort, store, prepare, convert, fabricate, manufacture or otherwise process finished products consisting of at least ninety percent recycled materials.

(ii) Prepare, fabricate, manufacture or otherwise process finished products that are powered exclusively with solar or other specific renewable energy.

(iii) Prepare, fabricate, manufacture or otherwise process raw material or intermediate product exclusively through a hydrometallurgical process where at least eighty-five percent of the process solution used to produce the finished product is recycled on site for additional production.

(iv) Fabricate or manufacture finished paper products that consist of at least eighty percent recycled material.

(v) Process biomass into forestry industry products.

(c) Costs, or is expected to cost, an aggregate of at least $20,000,000 of new capital investment in this state within five years after construction begins or commencement of installation of improvements.

F. Certification and qualification by an environmental technology manufacturer, producer or processor for purposes of this section does not constitute compliance with any provision of title 49 or any rule, order, procedure, permit or other regulatory measure required pursuant to title 49. An environmental technology manufacturer, producer or processor shall comply with all applicable environmental requirements of the department of environmental quality separately and independently from qualifying for assistance under this section. For purposes of complying with title 49, all definitions in that title and those adopted in rules pursuant to that title shall be applicable.

G. To qualify for tax incentives the taxpayer shall:

Agree with the department of commerce in writing to furnish information relating to the amount of tax benefits the taxpayer receives each year. If the taxpayer fails to provide the required information, the department of commerce shall immediately revoke the taxpayer's qualification and notify the department of revenue.
Enter into a memorandum of understanding with this state through the department of commerce containing employment goals. Each year the taxpayer shall report in writing to the department of commerce its performance in achieving the goals. The memorandum shall contain provisions that allow:

(a) The department of commerce to stop, readjust or recapture all or part of the tax incentives provided to the taxpayer on noncompliance with the terms of the memorandum.

(b) The department of commerce to notify the department of revenue of the conditions of noncompliance.

(c) The department of revenue to require the taxpayer to file appropriate amended tax returns reflecting the recapture of the tax incentives.

H. A manufacturer, producer or processor who is certified by the department of commerce to qualify for assistance under this section shall not have the certification revoked and shall not be disqualified because of the adoption after certification of a rule or a federal regulation relating to the requirements under subsection E of this section.

I. Retroactive to July 1, 1996, the certification of a qualified environmental technology manufacturer, producer or processor may be assigned or transferred to one or more successor taxpayers, manufacturers, producers or processors that have acquired and continue to operate a facility that was used to meet the qualifications prescribed in subsection E of this section and that continues to be used predominantly for the purposes prescribed in subsection E, paragraph 2, subdivision (b) of this section.

J. For purposes of this section:

"Environmental technology" means solar and other renewable energy products or recycled materials.
"Facility" includes a single facility, a combination of facilities, land, improvements, building improvements, real and personal property used for environmental protection facilities as defined in section 42-14154, property used to generate on-site power or energy and machinery and equipment.
"Finished paper product" means a paper item or commodity or one of its components, including newsprint, paper napkins, paper towels, corrugated paper and related cellulosic products, that contains not more than ten percent noncellulosic material such as laminates, binders or saturants, that has economic value to a consumer or purchaser and that is ready to be used with or without further altering its form.
"Finished product" means a marketable product or component of a product that has economic value to a consumer or purchaser and that is ready to be used with or without further altering its form.
"Hydrometallurgical processing" includes facilities used exclusively for solvent extraction electrowinning, hydrometallurgical recovery, precipitation and refining, but does not include smelters, open pit and underground mines, and concentrator processes.
"Machinery and equipment" means machinery and equipment that are directly or indirectly used to do any of the following:

(a) Sort, store, prepare, convert, fabricate, manufacture or otherwise process finished products consisting of at least ninety percent recycled materials, including all machinery and equipment designed and used for environmental protection on site as well as all machinery and equipment used to generate power or energy for use on site.

(b) Prepare, fabricate, manufacture or otherwise process finished products that are powered exclusively with solar or other specific renewable energy.

(c) Prepare, fabricate, manufacture or otherwise process raw material or intermediate product exclusively through a hydrometallurgical process where at least eighty-five percent of the process solution used to produce the finished product is recycled on site for additional production.

(d) Fabricate or manufacture finished paper products that consist of at least eighty percent recycled materials, including all machinery and equipment that is designed and used for environmental protection on site and machinery and equipment that is used to generate power or energy for use on site.

"Process solution" means solution that is required throughout the hydrometallurgical process and from which the finished product is extracted.
"Qualified environmental technology manufacturer, producer or processor" or "qualified environmental technology facility" means an entity that for purposes of titles 42 and 43 meets the qualifications prescribed in subsection E of this section and is certified by the department of commerce pursuant to subsection C of this section.
"Recycled materials" means materials that have been separated, recovered or diverted from the solid waste stream and processed and returned to the economic stream in the form of raw materials or finished products. Recycled materials include work in process by the environmental technology manufacturing, producing or processing company that is composed of at least ninety percent recycled materials and that will be further processed into a finished product.
"Renewable energy" means energy that is supplied from sources that are continually replenished from the sun, the earth or the waste stream, including hydroelectric, solar-thermal, photovoltaic, biomass, wind and geothermal processes.
"Solid waste" means any garbage, trash, rubbish, refuse, sludge from a waste treatment plant, water supply treatment plant or pollution control facility and other discarded material, including solid, liquid, semisolid or contained gaseous material resulting from industrial, agricultural, silvicultural and commercial operations and from community activities, but not including domestic sewage or hazardous waste unless such waste is received by an environmental technology manufacturer, producer or processor that holds a storage facility permit issued by the department of environmental quality pursuant to 40 Code of Federal Regulations section 270.10 as of July 1, 1993.

§ 41-1516 Healthy forest enterprise incentives; definitions

A. The Arizona commerce authority shall:

Implement a program to encourage counties, cities and towns to provide local incentives to economic enterprises that promote forest health in this state.
Identify and certify to the department of revenue the names of and relevant information relating to qualified businesses for the purposes of available state tax incentives for economic enterprises that promote forest health in this state.

B. To qualify for state tax incentives pursuant to this section, a business:

Must be primarily engaged in a qualifying project. The business shall submit to the authority evidence that it is engaged in a qualifying project as follows:

(a) The business operation must enhance or sustain forest health, sustain or recover watershed or improve public safety.

(b) If the qualifying forest product is on federal land, the business shall submit a letter from the federal agency administering the land, or official records or documents produced in connection with the project, stating that the business is primarily engaged in the business of harvesting or processing qualifying forest products for commercial use as follows:

(i) At least seventy percent of the harvested or processed products, measured by weight, must be qualifying forest products.

(ii) At least seventy-five percent of the qualifying forest products, measured by weight, must be harvested from sources in this state.

(c) If the qualifying forest product is not on federal land, the business shall submit a letter from the state forester stating that the business is primarily engaged in the business of harvesting or processing qualifying forest products for commercial use as follows:

(i) At least seventy percent of the harvested or processed products must be qualifying forest products.

(ii) At least seventy-five percent of the harvested or processed products must be from areas in this state.

(d) If the business is engaged in transporting qualifying forest products, it must submit a letter from the state forester or United States forest service, or official records or documents produced in connection with the project, stating that all of the qualifying forest products it transports are harvested from areas in this state. In addition, the business must submit evidence to the authority that at least seventy-five percent of the mileage traveled by its units each year are for transporting qualifying forest products from or to qualifying projects described in subdivision (b) or (c) of this paragraph unless a lower mileage is due to forest closures or weather conditions that are beyond the control of the business.

Must employ at least one permanent full-time employee.
Must agree to furnish to the authority information relating to the amount of state tax benefits that the business receives each year.

4. Must enter into a memorandum of understanding with the authority containing:

(a) Employment goals. Each year the business must report in writing to the authority its performance in achieving the goals.

(b) A commitment to continue in business and use the qualifying equipment primarily on qualifying projects in this state as described in paragraph 1 of this subsection, other than for reasons beyond the control of the business. The authority shall consult with the department of revenue in designing the memorandum of understanding to incorporate the legal qualifications for the available tax incentives and shall include the requirement that any qualifying equipment that is purchased or leased free of transaction privilege or use tax must continue to be used in this state for the term of the memorandum of understanding or the duration of its operational life, whichever is shorter.

(c) Provisions considered necessary by the authority to ensure the competency and responsibility of businesses that qualify under this section, including registration or other accreditation with trade and professional organizations and compliance with best management and operational practices used by governmental agencies in awarding forestry contracts.

(d) The authorization for the authority to terminate, adjust or recapture all or part of the tax benefits provided to the business on noncompliance with the law, noncompliance with the terms of the memorandum or violation of the terms of any contracts with the federal or state government relating to the qualifying project. The authority shall notify the department of revenue of the conditions of noncompliance. The department of revenue may also terminate the certification if it obtains information indicating a failure to qualify and comply. The department of revenue may require the business to file appropriate amended tax returns or to file appropriate use tax returns reflecting the recapture of the direct or indirect tax benefits.

5. Must submit a copy of the certification to the department of revenue for approval before using the certification for purposes of any tax incentive. The department of revenue shall review and approve the certification in a timely manner if the business is in good standing with the department and is not delinquent in the payment of any tax collected by the department. A failure to approve or deny the certification within sixty days after the date the business submits it to the department constitutes approval of the certification.

C. For the purposes of section 42-5075, subsection B, paragraph 18, the authority shall certify prime contractors that contract for the construction of any building, or other structure, project, development or improvement owned by a qualified business for purposes of a qualifying project described in subsection B, paragraph 1 of this section.

D. To obtain and maintain certification under this section, a business must:

1. Apply to the authority.

2. Submit and retain copies of all required information, including information relating to the actual or projected number of employees in this state.

3. Allow inspections and audits to verify the qualification and accuracy of information submitted to the authority.

E. Certification under this section is valid for sixty calendar months from the date of issuance. A business must apply for recertification at least thirty days before the current certification expires. The application for recertification shall be in a form prescribed by the authority and shall confirm that the business is continuing in a qualifying project and is in compliance with all requirements prescribed for certification.

F. Within sixty days after receiving a complete and correct application and all required information as prescribed by this section, the authority shall grant or deny certification and give written notice by certified mail to the applicant. The applicant is certified as a qualified business on the date the notice of certification is delivered to the applicant. A failure to respond within sixty days after receiving a complete and correct application constitutes approval of the application.

G. The certification shall state an effective date with respect to each authorized tax incentive, which, in each case, must be at the start of a taxable year or taxable period.

H. On or before March 1 of each year, each qualifying business shall make a report to the authority on all business activity in the preceding calendar year. Business information contained in the reports is confidential and shall not be disclosed to the public except as provided by this section and except that a copy of the report shall be transmitted to the department of revenue. The report shall be in a form prescribed by the authority and include:

Information prescribed by the authority with respect to both qualifying projects and other projects and business activity that do not qualify for purposes of this section.
The quantity, measured by weight, of qualifying forest products harvested, transported or processed.

I. On or before May 1 of each year, the authority shall report to the joint legislative budget committee the quantity, measured by weight, of qualifying forest products reported by harvesters, by transporters and by processors in the preceding calendar year.

J. For the purposes of administering and ensuring compliance with this section, agents of the authority may enter, and a qualified business shall allow access to, a qualifying project site at reasonable times and on reasonable notice to:

Inspect the facilities at the site.
Obtain factual data and records pertinent to and required by law to be kept for purposes of tax incentives.
Otherwise ascertain compliance with law and the terms of the memorandum of understanding.

K. The authority shall revoke the business' certification and notify the department of revenue and county assessor if either:

Within thirty days after a formal request from the authority or the department of revenue, the business fails or refuses to provide the information or access for inspections required by this section.
The business no longer meets the terms and conditions required for qualification for the applicable tax incentives.

L. For the purposes of this section:

"Forest health" means the degree to which the integrity of the forest is sustained, including reducing the risk of catastrophic wildfire and destructive insect infestation, benefiting wildland habitats, watersheds and communities.
"Harvesting" means all operations relating to felling or otherwise removing trees and other forest plant growth and preparing them for transport for subsequent processing.

3. "Processing" means:

(a) Any change in the physical structure of qualifying forest products removed from a qualifying project into a marketable commercial product or component of a product that has commercial value to a consumer or purchaser and that is ready to be used with or without further altering its form.

(b) Burning qualifying forest products in the process of commercial electrical generation or commercial thermal energy production for heating or cooling, regardless of the physical structure of the forest product before burning.

4. "Qualifying equipment" means equipment used directly in harvesting or processing qualifying forest products removed from a qualifying project. Qualifying equipment does not include self-propelled vehicles required to be licensed by this state but may include other licensed vehicles as provided by this paragraph. Qualifying equipment includes:

(a) Forest thinning and residue removal equipment, including mulching and masticating equipment, feller-bunchers, skidders, log loaders, portable chippers and grinders, slash bundlers, delimbers, log trailers, chip trailers and other trailers that are uniquely designed for handling forest products and that are licensed for operation on public highways.

(b) Forest residue receiving and handling equipment, including truck dumpers, log unloaders, scales, log decking facilities and equipment and chip pile facilities.

(c) Sorting and processing equipment, including portable and stationary log loaders, front-end loaders, forklifts and cranes, chippers and grinders, screens, decks and debarkers, saws and sawmill equipment, firewood processing, wood residue baling and bagging equipment, kilns, planing and molding equipment and laminating and joining equipment.

(d) Forest waste and residue disposal and processing equipment, including:

(i) Processing and sizing equipment, hogs, chippers, screens, pelletizers and wood splitters.

(ii) Transporting and handling equipment, including loaders, conveyors, blowers, receiving hoppers, truck dumpers and dozers.

(iii) Waste use equipment, including fuel feed, storage bins, boilers and combustors.

(iv) Waste project use equipment, including generators, switchgear and substations and on-site distribution systems.

(v) Generated waste disposal equipment, including ash silos and wastewater treatment and disposal equipment.

(vi) Shop and maintenance equipment and major spares having a value of more than $5,000 each.

"Qualifying forest products" means dead standing and fallen timber, and forest thinnings associated with the harvest of small diameter timber, slash, wood chips, peelings, brush and other woody vegetation, removed from federal, state and other public forest land and from private forest land.
"Qualifying project" means harvesting, transporting or processing qualifying forest products as required for certification pursuant to this section.

§ 41-1517 Arizona motion picture production program; duties; preapproval; postapproval; fee; rulemaking; audit; report; definitions

(Rpld. 1/1/44)

A. The authority shall:

Implement an Arizona motion picture production program in this state to promote the workforce development and expansion of the commercial motion picture industry in this state.
Certify motion picture production companies that produce one or more motion pictures in this state for the purpose of the tax credits allowed under section 43-1082 or 43-1165.

B. To qualify for the program, a motion picture production company shall:

Do either of the following:

(a) Use a qualified production facility in this state to produce the motion picture production.

(b) If the motion picture production is filmed primarily at a practical location, produce and film the motion picture production primarily in this state and perform all preproduction, postproduction and editing at an industry standard facility in this state, if such a facility for those functions is available.

Maintain the motion picture production company's production labor positions in this state.
Include in the credits for each motion picture production an acknowledgment that the production was filmed in Arizona.
Submit a completed application pursuant to subsection C of this section. An application is complete on receipt of all requested information.
Provide supporting statements and records requested by the authority to demonstrate that the motion picture production company satisfies the criteria provided in this subsection.

C. The application for certification under this section shall be on a form prescribed by the authority and shall include the following:

The name, address, telephone number and website address of the motion picture production company.
The name and address of an individual who will maintain records of expenditures in this state.
The projected first preproduction date and last production date in this state.
The production office address and office telephone number in this state.
The estimated total budget of the production.
The estimated total production cost expenditures in this state.
The estimated total percentage of the production that will take place in this state.
The estimated number and duration of full-time production labor employment positions in this state.
The estimated number of employees who are residents of this state in the cast and crew.
The estimated median wage of production labor employment positions in this state.
A script or synopsis, the name of the proposed director and a preliminary list of the cast and producer.
An affidavit that attests that the motion picture production company will meet all of the requirements to qualify for the tax credits, including that the motion picture production company will use a qualified production facility in this state to produce the motion picture production or otherwise satisfy the requirements prescribed in subsection B, paragraph 1 of this section.

D. The authority shall establish processes to:

Review a completed initial application submitted pursuant to this section within a time period prescribed by the authority by rule to determine whether the motion picture production company satisfies all of the criteria provided in subsection B of this section.
Certify and preapprove a motion picture production company for the motion picture production tax credits under section 43-1082 or 43-1165. Preapproval priority shall be based on the date that the motion picture production company files a complete initial application for certification with the authority.

E. The preapproved amount applies against the applicable dollar limit prescribed by subsection I of this section for the calendar year in which the application was submitted regardless of whether the preapproval period extends into the following year or years.

F. The authority shall deny an application if the authority determines that:

The motion picture production company does not meet all of the established criteria provided in subsection B of this section.
The production would constitute an obscene motion picture film or obscene pictorial publication under title 12, chapter 7, article 1.1.
The production violates the obscenity laws under title 13, chapter 35.
The production would constitute sexual exploitation of a minor or commercial sexual exploitation of a minor under title 13, chapter 35.1.

G. On a determination by the authority that a motion picture production company qualifies for the motion picture production tax credits under section 43-1082 or 43-1165, the authority shall issue the motion picture production company a preapproval letter and transmit a copy of the preapproval letter to the department of revenue. A preapproval letter is effective for a time period prescribed by the authority by rule that shall be stated in the preapproval letter. A motion picture production company may apply to the authority to extend the preapproval period if the motion picture production company can demonstrate that an act of force majeure occurred and that the preapproval letter will expire before the production is complete.

H. On completion of the motion picture production, a motion picture production company that is preapproved for the motion picture production tax credits under section 43-1082 or 43-1165 shall apply to the authority, on a form prescribed by the authority, for approval of motion picture production tax credits and provide an audited statement completed by a certified public accountant in this state that certifies the total amount of eligible production costs associated with the production. The authority shall provide postapproval to a motion picture production company that the motion picture production company has met the eligibility requirements of this section and notify the department of revenue that the motion picture production company may claim the tax credits under section 43-1082 or 43-1165.

I. The authority may not preapprove tax credits exceeding the following amounts in a calendar year, of which up to $25,000,000 in each calendar year may be used for motion picture productions that qualify for the program pursuant to subsection B, paragraph 1, subdivision (b) of this section:

In calendar year 2023, $75,000,000.
In calendar year 2024, $100,000,000.
In calendar year 2025, and each calendar year thereafter, $125,000,000.

J. Any information gathered from motion picture production companies for the purposes of this section is considered confidential taxpayer information and shall be disclosed only as provided in section 42-2003, subsection B, paragraph 12.

K. The authority shall adopt fees and deposit requirements and rules and shall publish and prescribe forms and procedures as necessary to administer this section and provide administrative support services.

L. The authority shall submit a report on or before December 31 each year to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state. The authority shall also make the report available to the general public on request. The report shall include:

Information relating to the program's activities, receipts and expenditures.
Information comparing the annual amount of monies credited to certified motion picture production companies to the estimated amount of monies spent on in-state production costs by motion picture production companies.
Quarterly data on the growth and development of motion picture industry employment and wages in this state.
A third-party review of the relative economic benefits to this state based on an analysis of the following:

(a) A comparison of the estimated state tax revenues generated by motion picture production activity to the calculated value of the tax credit. State tax revenue estimates shall include the sum of all income taxes, transaction privilege taxes and other taxes imposed by this state.

(b) The direct, indirect and induced inputs that rely on commonly used input-output economic modeling for generating economic multipliers and that measure the direct and indirect impact of the motion picture production industry and identifiable induced economic activity in this state, including benefits related to construction activity and the associated state transaction privilege tax.

(c) The difference between the state tax revenues estimated pursuant to subdivision (a) of this paragraph and the amount of monies credited pursuant to sections 43-1082 and 43-1165, aggregated each year and reported on a cumulative basis in each succeeding year.

M. Beginning on the fifth year after the authority issues the first preapproval letter and at least every fifth year thereafter, the authority shall perform an audit of the program. On or before June 30 of the respective year, the authority shall issue a public report of the audit and submit the report of the audit to the president of the senate and the speaker of the house of representatives and shall provide a copy to the secretary of state. The auditor general shall review each audit performed pursuant to this subsection and report the auditor general's findings to the president of the senate and the speaker of the house of representatives and shall provide a copy to the secretary of state. The audit performed on the tenth year after the first audit by the authority shall include a recommendation for whether the program is economically viable and effective.

N. Each audit report required by subsection M of this section must include:

The cumulative total number of production labor employment positions and labor costs related to those positions that qualified for the tax credits allowed under section 43-1082, subsection A, paragraph 2 or section 43-1165, subsection A, paragraph 2 for each year the credit is taken.
A comparison of the median wage of production labor employment positions in each county and the median wage in the county in which a production labor employment position is located.
The cumulative total of worker-days calculated by multiplying the total number of production labor employment positions by the number of days worked for each position during the employment.

O. For the purposes of this section:

"Motion picture production" means a single medium or multimedia program, including a feature film, episodic series or commercial advertisement message, that:

(a) Is created by production activities conducted in this state.

(b) Can be viewed or reproduced.

"Motion picture production company" means any person that is primarily engaged in the business of producing motion pictures and that has a physical business office in this state.
"Practical location" means a location at which a motion picture production is filmed that is not and that does not use an industry standard sound stage or production facility to produce and film the motion picture production.
"Production costs":

(a) Means costs for the following that are incurred and taxable in this state:

(i) All compensation paid to talent, writers, directors and management.

(ii) All compensation paid for production labor.

(iii) Set construction and operation costs paid pursuant to construction contracts with contractors that are licensed under title 32, chapter 10.

(iv) Wardrobe, props, accessories and related services.

(v) Photography, sound synchronization, lighting and related costs.

(vi) Editing and related services.

(vii) Rental of qualified production facilities.

(viii) Rental of equipment.

(ix) Catered food, drink and condiment purchased from a qualified production facility.

(x) Other direct in-state costs of producing the motion picture production pursuant to rules adopted by the authority.

(b) Does not include payments for penalties and fines or fees or deposits established by the authority or the department of revenue to administer the program.

"Production labor" means all laborers working on a production that are not talent, writers, directors, producers or management.
"Program" means the Arizona motion picture production program implemented pursuant to this section.
"Qualified production facility" means a structure that is built for film industry purposes, is located in this state, is at least ten thousand square feet and meets generally accepted industry standards, including standards for soundproofing, lighting, air conditioning and motion picture production quality technology for producing, filming or otherwise creating a motion picture production.

§ 41-1518 Capital investment incentives; evaluation; certification; definitions

A. The Arizona commerce authority shall receive and evaluate applications that are submitted by qualified investors to receive a tax credit pursuant to section 43-1074.02 for qualified investments made in a qualified small business and shall certify to the department of revenue the names, amounts and other relevant information relating to the applicants.

B. To be eligible for a tax credit pursuant to this section and section 43-1074.02, a qualified investor shall file an application with the authority within ninety days after making a qualified investment. The application, on a form prescribed by the authority, shall include:

The name, address and federal income tax identification number of the applicant.
The name and federal employer identification number of the qualified small business that received a qualified investment made by the applicant.
The date the qualified investment was made.
Any additional information that the authority requires.

C. As part of the application, the applicant and the qualified small business that receives the investment shall each provide written authorization pursuant to section 42-2003 designating the authority as eligible to receive tax information from the department of revenue for the purpose of determining if any misrepresentations exist on the application. The authorization shall limit disclosure to income tax information for the latest two years for which returns were filed with the department of revenue preceding the date the application is filed and for all tax years through the year in which the investment was made for which a return was not filed as of the date of the application. The applicant shall also provide in the written authorization income tax information for all tax years in which the applicant could claim or carry forward the credit pursuant to this section, but limited to the tax years in which the applicant actually claims a credit or carries forward a credit on a return filed with the department of revenue. An applicant who has an individual ownership interest as a co-owner of a business who may be entitled to a pro rata share of the credit pursuant to section 43-1074.02, subsection E shall provide a written authorization with content similar to the authorization, and in the same manner as, any other applicant is required to provide.

D. The authority shall review and make a determination with respect to each application within ninety days after receiving the application. The authority may request additional information from the applicant in order to make an informed decision regarding the eligibility of the qualified investor or qualified small business.

E. Subject to subsection F of this section, the authority shall authorize tax credits for each qualified investor who makes a qualified investment in a qualified small business. The amount of the credit shall be:

If the qualified investment is made in a qualified small business that maintains its principal place of business in a rural county of this state or is a bioscience enterprise, twelve percent of the amount of the investment per year for the first and second taxable years after the investment is made and eleven percent of the amount of the investment for the third taxable year after the year in which the investment is made.
If the qualified investment is made in a qualified small business other than a business described in paragraph 1 of this subsection, ten percent of the amount of the investment for each of the three taxable years after the year in which the investment is made.

F. The authority shall not authorize tax credits under this section after June 30, 2031. Through June 30, 2017, the authority shall not certify tax credits under this section exceeding $20,000,000. From and after June 30, 2017 through June 30, 2021, the authority may certify additional tax credits under this section not exceeding $2,500,000 each fiscal year, plus any unused credit capacity that carries over from the preceding fiscal year or years. From and after June 30, 2021 through June 30, 2031, the authority may certify additional tax credits under this section not exceeding $2,500,000 each fiscal year, plus any unused credit capacity that carries over from the preceding fiscal year or years. Tax credits that expire after certification or that are otherwise not timely used by the qualified investor for whom they were originally authorized shall also be included in the applicable dollar limit. If qualifying applications exceed the dollar limit, the authority shall authorize credits in the order of the date and time that the applications are received by the authority, as evidenced by the time and date stamped on the application when received by the authority. All applications shall be filed on a form and in the manner prescribed by the authority. If an application is received that, if authorized, would require the authority to exceed the applicable dollar limit, the authority shall only grant the applicant the remaining amount of tax credits that would not exceed the dollar limit. After the authority authorizes the allowable amount of tax credits, the authority shall deny any subsequent applications that are received. The authority shall certify to the qualified investor and to the department of revenue the amount of the tax credit that is authorized for the purposes of section 43-1074.02 for each taxable year described in subsection E of this section.

G. The total of all qualified investments in any calendar year by a qualified investor and its affiliates in qualified small businesses that are eligible for a tax credit pursuant to this section and section 43-1074.02 shall not exceed $500,000. The maximum amount of qualified investments in a single qualified small business for which the authority may authorize tax credits under this section shall not exceed an aggregate of $2,000,000 in investments for all taxable years. If applications for tax credits are received for investments that exceed the limits prescribed by this subsection for any qualified small business, the authority shall authorize credits in the order of the date and time that the applications are received by the authority. If an application is received that, if authorized, would require the authority to authorize tax credits for any investment in a qualified small business that would cause the total qualified investments in the business to exceed the limits prescribed by this subsection, the authority shall only grant the applicant the remaining amount of tax credits that would not exceed the limits prescribed by this subsection.

H. The qualified investor shall file a return claiming the tax credit with the department of revenue for application against income tax pursuant to section 43-1074.02 by the due date of the return, including extensions, for the tax year in which the credit is available. If the qualified investor fails to timely file a return claiming the credit for a taxable year, the credit expires for that taxable year and there shall be no carryforward of the expired credit. If a qualified investor includes co-owners of a business who qualify for individual pro rata shares of the credit pursuant to section 43-1074.02, subsection E, each individual owner shall file a return claiming the tax credit with the department of revenue by the due date of the return, including extensions, for the tax year in which the credit is available. If an individual co-owner fails to timely file a return claiming the credit for a taxable year, the credit expires for that taxable year and there shall be no carryforward of the expired credit. Credits that expire or that otherwise are not timely used by the qualified investor or by the individual co-owner of a business for whom the credits were originally authorized shall not be reissued.

I. On receiving an application for a tax credit from a qualified investor, or a written request for certification as a qualified small business from a corporation, limited liability company, partnership or other business entity, the authority shall determine whether the corporation, limited liability company, partnership or other business entity that is named in the application or written request is a qualified small business. The authority shall determine if the business is a bioscience enterprise and if the business maintains its principal place of business in a rural county in this state. After determining the qualifications, the authority shall certify the qualified small business as being eligible to receive qualified investments for purposes of this section. The certification is valid for one year, but the authority may revoke the certification at any time or refuse to renew the certification if the business fails to maintain the required qualifications. If a qualified small business fails to maintain the qualifications, the business shall notify the authority within five business days after failing to meet the qualifications. The authority shall revoke the certification of the business and may assess a penalty against the business entity equal to the amount of the tax credits authorized after the business failed to meet the qualifications. The penalty shall be deposited in the state general fund. If the certification is revoked or expires, subsequent investments in the business do not qualify for a tax credit pursuant to this section and section 43-1074.02. All tax credits that are issued before any expiration or revocation of the certification shall remain valid. Any application for a tax credit shall not be denied on the basis of the expiration or revocation of the certification if the investment was made before the date of the expiration or revocation.

J. The authority shall provide to the department of revenue necessary information required to administer this section and section 43-1074.02. If the authority subsequently discovers that an applicant who received a tax credit misrepresented information on the application, the authority shall immediately notify the department of revenue and provide the department of revenue all information that relates to that applicant. If the department of revenue determines that there has been a misrepresentation on the application, the department of revenue shall deny the credit if the misrepresentation relates to whether the applicant was a qualified investor or made a qualified investment. If the misrepresentation relates to whether the investment was made to:

A qualified small business, the department of revenue shall deny the credit only if the applicant knew or should have known at any time before the certification that the representation was false.
A bioscience enterprise or a business that maintains its principal place of business in a rural county in this state, the department of revenue shall decrease the amount of the credit that would have been allowed under subsection E, paragraph 1 of this section to the amount allowed under subsection E, paragraph 2 of this section only if the applicant knew or should have known at any time before the certification that the representation was false.

K. For the purposes of this section:

"Affiliate" means any person or entity that controls, that is controlled by or that is under common control with another person or entity. For the purposes of this paragraph, "control" means the power to determine the policies of an entity whether through ownership of voting securities, by contract or otherwise.
"Asset" means any owned property that has value, including financial assets and physical assets. Intellectual property shall not be included when determining total assets.
"Bioscience enterprise" means a business whose activity is related to bioscience as determined by the authority or any corporation, partnership, limited liability company or other business entity that is primarily engaged in a business that conducts research, development, manufacturing, marketing, sales and licensing of products, services and solutions relating to either of the following:

(a) Medical, pharmaceutical, nutraceutical, bioengineering, biomechanical, bioinformatics or other life-science based applications.

(b) Applications of modern biological, bioengineering, biomechanical or bioinformatics technologies in the fields of human, plant or animal health, agriculture, defense, homeland security or the environment.

"Qualified investment" means an investment in an equity security that meets all of the following requirements:

(a) The equity security shall be common stock, preferred stock, an interest in a partnership or limited liability company, a security that is convertible into an equity security or any other equity security as determined by the authority.

(b) The investment shall be at least $25,000.

(c) The qualified investor and its affiliates do not hold, of record or beneficially, immediately before making an investment, equity securities possessing more than thirty percent of the total voting power of all equity securities of the qualified small business.

"Qualified investor" means an individual, limited liability company, partnership, S corporation as defined in section 1361 of the internal revenue code or other business entity that makes a qualified investment in a qualified small business. Qualified investor does not mean a corporation that is subject to tax under title 43, chapter 11.
"Qualified small business" means a corporation, limited liability company, partnership or other business entity that:

(a) Maintains at least a portion of its operations at an office or manufacturing or research facility located in this state.

(b) Has at least two principal full-time equivalent employees who are residents in this state. For the purposes of this subdivision, "principal" means a person whose sole responsibility is not administrative.

(d) Has total assets not exceeding $2,000,000 through December 31, 2011 or $10,000,000 beginning from and after December 31, 2011, excluding any investment made under this section.

(e) Has not exceeded the limit on qualified investments prescribed by subsection G of this section.

(f) Does not have a principal business involving activities excluded by the authority. The authority shall provide a list of excluded businesses to any person on request.

"Rural county" means a county that has a population of seven hundred fifty thousand or fewer persons.

§ 41-1519 Computer data center tax relief; definitions

A. From and after August 31, 2013, tax relief is allowed for the owner or operator of a computer data center certified pursuant to this section. The same tax relief is allowed for qualified colocation tenants of the computer data center. All tax relief applies during the qualification period.

B. To qualify for the tax relief, the owner or operator shall submit to the authority an application on a form prescribed by the authority that includes all of the following:

The owner's or operator's name, address and telephone number.
The address of the site where the facility is or will be located, including, if applicable, information sufficient to identify the specific portion or portions of the facility composing the computer data center.
If the computer data center is to qualify under subsection E, paragraph 1 of this section, both of the following:

(a) The anticipated investment associated with the computer data center for which the tax relief is being sought and whether the computer data center is anticipated to qualify as a sustainable redevelopment project.

(b) An affirmation, signed by an authorized executive representing the owner or operator, that the computer data center is expected to satisfy one of the certification requirements prescribed in subsection E, paragraph 1 of this section and that the computer data center will not violate subsection M of this section.

If the computer data center is to qualify under subsection E, paragraph 2 of this section, an affirmation, signed by an authorized executive representing the owner or operator, that the computer data center has satisfied the certification requirements prescribed in subsection E, paragraph 2 of this section, whether the computer data center qualifies as a sustainable redevelopment project and that the computer data center will not violate subsection M of this section.

C. Within sixty days after receiving a complete and correct application, the authority shall review the application and either issue a written certification that the computer data center qualifies for the tax relief or provide written reasons for its denial. Failure to approve or deny the application within sixty days after the date the owner or operator submits the application to the authority constitutes approval of the computer data center, and the authority shall issue written certification to the owner or operator within fourteen days. The effective date of the certification is either the date on which the application was submitted to the authority or a prospective date stated in the application that does not exceed five years after the date on which the application was submitted. The authority shall send a copy of the certification, including its effective date, to the department of revenue. The authority shall not certify any new computer data center that submits an application to the authority after December 31, 2033.

D. An owner or operator may separate a facility into one or more computer data centers, which may each receive a separate certification if each computer data center individually meets the requirements prescribed in subsection E of this section. A portion of a facility or an article of computer data center equipment shall not be deemed to be a part of more than one computer data center. The owner or operator may aggregate one or more of the parcels, buildings, condominiums or modular data centers in a facility into a single computer data center if, in the aggregate, the parcels, buildings, condominiums and modular data centers meet the requirements of subsection E of this section.

E. A computer data center must meet one of the following requirements after taking into account the combined investments made by the owner, operator or qualified colocation tenants of a computer data center:

On or before the fifth anniversary of certification, the computer data center creates a minimum investment of at least:

(a) $25,000,000 of new investment, including costs of land, buildings, improvements, modular data centers and computer data center equipment, whether owned or leased or paid for pursuant to a right to use agreement, if the computer data center is located in a county with a population of eight hundred thousand or less persons.

(b) $50,000,000 of new investment, including costs of land, buildings, improvements, modular data centers and computer data center equipment, whether owned or leased or paid for pursuant to a right to use agreement, if the computer data center is located in a county with a population of more than eight hundred thousand persons.

During the seventy-two months immediately before September 1, 2013, the computer data center created an investment of at least $250,000,000, including costs of land, buildings, improvements, modular data centers and computer data center equipment, whether owned or leased or paid for pursuant to a right to use agreement.

F. On or before the fifth anniversary of the certification of a new computer data center, the owner or operator shall notify the authority in writing that the computer data center for which the certification is requested has or has not satisfied the requirements prescribed in subsection E, paragraph 1 of this section. Until a new computer data center satisfies the requirements prescribed in subsection E, paragraph 1 of this section, the owner or operator shall keep detailed records of all investment created by the new computer data center, including costs of land, buildings, improvements, modular data centers and computer data center equipment, and all tax relief directly received by the owner or operator. This subsection does not apply to an existing computer data center.

G. If the authority determines that:

A new computer data center that is certified under subsection E, paragraph 1 of this section has not complied with the requirements and time periods prescribed by subsection E, paragraph 1 of this section, the authority shall revoke the computer data center's certification. If the certification is revoked, the qualification period of any owner, operator or qualified colocation tenant of the computer data center automatically terminates, and the department of revenue may recapture all or part of the tax relief provided directly to the owners and operators. A qualified colocation tenant is not subject to recapture of any part of tax relief received pursuant to this section, except that a contributing qualified colocation tenant may be subject to recapture if it is located in a computer data center that is certified from and after August 31, 2016. An owner or operator may appeal any revocation under this paragraph pursuant to chapter 6, article 10 of this title.
There has been a violation of subsection M of this section with respect to a computer data center:

(a) The authority shall revoke the computer data center's certification and, if revoked, the qualification period of any owner, operator or qualified colocation tenant of the computer data center automatically terminates.

(b) The department of revenue may not recapture any tax relief provided directly to the owner, operator or qualified colocation tenant before the date of revocation.

H. The authority and the department of revenue shall adopt rules and prescribe forms and procedures as necessary for the purposes of this section. The authority and the department shall collaborate in adopting rules as necessary to avoid duplication and inconsistencies while accomplishing the purposes of this section. The authority has exclusive authority over issues related to certification, including determinations as to whether a computer data center has satisfied the requirements of subsection E of this section, constitutes a qualified sustainable redevelopment project or has committed a violation of this section. The department of revenue has exclusive authority over the administration of tax relief.

I. Proprietary business information contained in the application described in subsection B of this section, the written notice described in subsection F of this section and the list described in subsection J of this section are confidential and shall not be disclosed to the public except that the information shall be transmitted to the department of revenue. The authority or the department may disclose the name of a computer data center that has been certified pursuant to this section.

J. The owner or operator shall provide the authority and the department of revenue with a list of qualified colocation tenants, including the commencement and expiration dates of each qualified colocation tenant's agreement to use or occupy all or part of the computer data center, and shall notify the authority and the department of any changes within thirty days. The failure of an owner or operator to provide the list or notify the authority and department of revenue of changes within the required time is not grounds for termination of the computer data center's certification, but may preclude unlisted colocation tenants from receiving tax relief until the list is provided or updated.

K. Except as provided in subsection G of this section, if a computer data center has been certified, the certification remains in effect, even in the event of a future transfer, sale or disposition, directly or indirectly, of the computer data center.

L. For the purposes of qualifying and continuing as a sustainable redevelopment project:

After receiving certification, an owner may substantially demolish all or part of an existing building to the extent reasonably necessary to accommodate future computer data center use, and the demolition is not cause for loss of certification as a sustainable redevelopment project. An existing building that has been substantially demolished before certification is not eligible to qualify as a sustainable redevelopment project.
An owner or operator may expand the boundaries of a certified computer data center by increasing the size of an existing building within a sustainable redevelopment project or by building additional improvements in an unlimited manner to the extent the expansion is constructed on the same parcel of land on which the original sustainable redevelopment project is located or on a contiguous parcel, regardless of whether the contiguous parcel was within the original description of the boundaries of the certified computer data center. Expansion activities do not prevent a facility from maintaining its classification as a sustainable redevelopment project.
All construction activities and investments related to demolition and expansion activities described in this subsection are considered to be a part of the sustainable redevelopment project.

M. This section does not allow a computer data center to do either of the following:

Generate electricity for resale purposes.
Generate, provide or sell electricity outside of the computer data center.

N. The owner or operator may be a single individual or entity or multiple affiliated entities.

O. For the purposes of this section:

"Computer data center" means all or part of a facility that may be composed of multiple businesses or owners, that is or will be predominantly used to house working servers and that may have uninterruptible energy supply or generator backup power, or both, cooling systems, towers and other temperature control infrastructure.
"Computer data center equipment" means equipment that is used to outfit, operate or benefit a computer data center and component parts, installations, refreshments, replacements and upgrades to this equipment, regardless of whether affixed to or incorporated into real property, and whether owned, leased or used by the owner or operator pursuant to a contract for the right to use the equipment, including:

(a) All equipment necessary for the transformation, generation, distribution or management of electricity that is required to operate computer server equipment, including generators, uninterruptible energy, supplies, conduit, gaseous fuel piping, cabling, duct banks, switches, switchboards, batteries and testing equipment.

(b) All equipment necessary to cool and maintain a controlled environment for the operation of the computer server and other components of the computer data center, including mechanical equipment, refrigerant piping, gaseous fuel piping, adiabatic and free cooling systems, cooling towers, water softeners, air handling units, indoor direct exchange units, fans, ducting and filters.

(c) All water conservation systems, including facilities or mechanisms that are designed to collect, conserve and reuse water.

(d) All enabling software, computer server equipment, chassis, networking equipment, switches, racks, cabling, trays and conduit.

(e) All monitoring equipment and security systems.

(f) Modular data centers and preassembled components of any item described in this paragraph, including components used in the manufacturing of modular data centers.

(g) Other tangible personal property that is essential to the operations of a computer data center.

"Contributing qualified colocation tenant" means a qualified colocation tenant that is an operator or that had its anticipated investment included in an application for certification for the purposes of satisfying subsection E, paragraph 1 of this section.
"Existing building" means any existing vertical building improvement located at a facility used for commercial purposes at the time of its acquisition by an owner, but not including single family residential structures, barns or other agricultural structures.
"Existing computer data center" means a computer data center that is certified under subsection E, paragraph 2 of this section.
"Facility" means one or more parcels of land in this state and any structures and personal property contained on the land.
"Investment" means all monies spent to acquire a facility regardless of prior use and all monies spent to construct or expand a computer data center, including costs of land, buildings, improvements, modular data centers and computer data center equipment. For new data centers, investment includes all costs incurred on or after a date that is thirty days before the date the application is submitted to the authority.
"Modular data center" means a portable system of information technology, climate control, energy supply and energy distribution machinery, equipment and related tangible personal property contained in an intermodal freight container or similar structure.
"New computer data center" means a computer data center that is certified under subsection E, paragraph 1 of this section.
"Operator" means any individual or entity that operates a computer data center as an operator or lessor or pursuant to a contract with an owner or lessor. Operator includes a licensed property management company, a property lessor or any other individual or entity responsible for the control, oversight or maintenance of a facility.
"Qualification period" means:

(a) With respect to the owner or operator of a computer data center, a period of time beginning on the effective date of the computer data center's certification and expiring at the end of the tenth full calendar year following the calendar year containing the effective date, except, if a computer data center is a sustainable redevelopment project, qualification period means a period of time beginning on the effective date of the computer data center's certification and expiring at the end of the twentieth full calendar year following the calendar year containing the effective date.

(b) With respect to the qualified colocation tenant of the owner or operator of a computer data center certified under this section, a period of time beginning on the date that the qualified colocation tenant enters into an agreement concerning the use or occupancy of the computer data center and expiring at the earlier of the expiration of the term of the agreement or the tenth full calendar year following the calendar year in which the qualified colocation tenant entered into the agreement, except, if a computer data center is a sustainable redevelopment project, qualification period means a period of time beginning on the date that the qualified colocation tenant enters into an agreement concerning the use or occupancy of the computer data center and expiring at the earlier of the expiration of the term of the agreement or the twentieth full calendar year following the calendar year in which the tenant entered into the agreement. The qualification period for a qualified colocation tenant may not extend beyond the qualification period for the owner or operator of the computer data center.

"Qualified colocation tenant" means an entity that contracts with the owner, the operator or another qualified colocation tenant of a computer data center that is certified pursuant to this section to use or occupy all or part of the computer data center for at least five hundred kilowatts per month for a period of two or more years.
"Sustainable redevelopment project" means a computer data center that satisfies the requirements in subsection E of this section and is either:

(a) A newly constructed data center, with at least a $200,000,000 investment, that attains certification under the energy star or green globes standard, the leadership in energy and environmental design green building rating standard developed by the United States green building council or an equivalent green building standard and was not previously certified under these standards.

(b) A data center that occupies an existing facility that either:

(i) Was at least fifty percent vacant for six of the twelve consecutive months before the acquisition by purchase or lease of or with respect to the facility.

(ii) Attains certification under the energy star or green globes standard, the leadership in energy and environmental design green building rating standard developed by the United States green building council or an equivalent green building standard and was not previously certified under these standards.

"Tax relief" means the deductions of the gross proceeds of sale or gross income from the sale, use, installation, assembly, repair or maintenance of computer data center equipment as prescribed by sections 42-5061, 42-5075, 42-5159 and 42-6004 for use at a computer data center.

§ 41-1520 International operations centers; utility relief; certification; revocation; definitions

A. Utility relief is allowed for the owner or operator of an international operations center that is certified pursuant to this section.

B. To qualify for the utility relief, the owner or operator must submit to the authority an application in a form prescribed by the authority that includes all of the following:

The owner's or operator's name, address and telephone number.
The address of the site where the facility is or will be located, including, if applicable, information sufficient to identify the specific portion or portions of the facility comprising the international operations center.
An estimate of the total investment the owner or operator or an affiliated entity, including investments made by a third-party entity on behalf of and for the benefit of the owner, operator or affiliated entity, will make, over a three-year period beginning on the date the application is received, in new renewable energy facilities in this state that produce energy for self-consumption by the international operations center using renewable energy resources.
The expected location of each of the renewable energy facilities that comprise the total investment estimated in paragraph 3 of this subsection and the earliest date that each facility is expected to be operational.
A statement that a portion of the power generated by each renewable energy facility, as required by subsection D, paragraph 4 of this section, is for self-consumption and will be used for international operations center use.

C. Within sixty days after receiving a complete and correct application, the authority shall review the application and either issue a written certification that the international operations center qualifies for the utility relief or provide written reasons for its denial. A failure to approve or deny the application within sixty days after the date of submittal constitutes certification of the international operations center, and the authority shall issue written certification to the owner or operator within fourteen days. The authority shall send a copy of the certification to the department of revenue.

D. The owner or operator of the international operations center must achieve all of the following requirements after taking into account the combined investments made by the owner or operator:

A minimum annual investment of $100,000,000 in new capital assets, including costs of land, buildings and international operations center equipment in each of ten consecutive taxable years of the owner or operator. Investments greater than $100,000,000 in any taxable year may be carried forward as a credit toward the investment requirement in future years.
On or before the tenth anniversary of certification, a minimum investment of at least $1,250,000,000 in new capital assets, including costs of land, buildings and international operations center equipment.
An investment by the owner or operator or an affiliated entity, or a third-party entity on behalf of or for the direct benefit of the owner, operator or affiliated entity, of at least $100,000,000 in one or more new renewable energy facilities in this state that produce energy for self-consumption using renewable energy resources. The minimum investment must be completed within a three-year period beginning on the date the initial application is received or by December 31, 2030, whichever is earlier. Construction of the renewable energy facilities shall begin not later than six months after the receipt of the application.
The use of a portion of the energy produced at each renewable energy facility for self-consumption in this state. By the fifth year a renewable energy facility is in operation, at least fifty-one percent of the energy produced must be used for self-consumption in this state. Self-consumption includes the power used by related entities if the related entities are directly or indirectly under the same ownership interests that collectively own more than eighty percent. Power that a renewable energy facility transfers to a utility qualifies as self-consumption if the utility is the same utility that provides power to the owner's or operator's international operations center in this state, regardless of whether the owner or operator or an affiliated entity owns or leases the renewable energy facility or the land on which it is located at the time of transfer.
The use of power for self-consumption under paragraph 4 of this subsection is for an international operations center in this state. A lessor of an international operations center facility that uses power for self-consumption under paragraph 4 of this subsection satisfies the requirements of this paragraph if the lessee is an international operations center and the power is transferred as part of the lease to the lessee.

E. Within thirty days after the end of each taxable year following certification, and within thirty days after the tenth anniversary of certification, the owner or operator shall furnish the authority written information demonstrating whether the certified international operations center has or has not satisfied the requirements prescribed in subsection D of this section. Until the requirements prescribed in subsection D of this section are met, the owner or operator shall keep detailed records of all capital investment in the international operations center, including costs of land, buildings and international operations center equipment, and all utility relief directly received by the owner or operator.

F. If the authority determines that the requirements of this section have not been satisfied, the authority may revoke the certification of the international operations center and notify the department of revenue in writing. The owner or operator may appeal the revocation. The authority may give special consideration or allow a temporary exception if there is extraordinary hardship due to factors beyond the owner's or operator's control. If certification is revoked, the department of revenue shall order the owner or operator to forfeit further entitlement to utility relief. If the owner or operator fails to make a minimum capital investment of $100,000,000 in a taxable year, taking into account any excess investment amounts carried forward from previous years, the owner or operator may avoid revocation of its certification by paying to the department of revenue within sixty days after the end of the taxable year the amount of the utility relief provided pursuant to this section in that year.

G. Each year after initial certification, on or before the anniversary date of the application specified in subsection B of this section, the owner, operator or affiliated entity must submit to the authority:

Documentation of the owner's, operator's or affiliated entity's progress toward the investment required by subsection D, paragraph 3 of this section. This documentation is not required after the authority receives a report stating that the required investment threshold has been reached.
Documentation for each renewable energy facility that demonstrates that the required portion of the power generated by each facility is for self-consumption as required by subsection D, paragraph 4 of this section.

H. The authority and the department of revenue shall prescribe forms and procedures as necessary for the purposes of this section.

I. Proprietary business information contained in the application form described in subsection B of this section and the written notice described in subsection F of this section are confidential and may not be disclosed to the public, except that the information shall be transmitted to the department of revenue. The authority or the department of revenue may disclose the name of an international operations center that has been certified pursuant to this section.

J. Except as provided in subsection F of this section, on certification, the international operations center remains certified unless ownership of the international operations center is sold, conveyed, transferred or otherwise directly or indirectly disposed of to another entity in which the original owner holds less than a controlling interest. For the purposes of this subsection, "controlling interest" means at least eighty percent of the voting shares of a corporation or of the interests in a noncorporate entity.

K. An owner or operator may be composed of a single entity or affiliated entities.

L. If the information required by subsection B, paragraphs 3, 4 and 5 of this section and the documentation required by subsection G of this section were already provided to the department of revenue for the purposes of the credit provided by section 43-1164.05, the owner or operator is not required to provide the information or documentation a second time under this section.

M. For the purposes of this section:

"Affiliated entity" means any of the following:

(a) An entity that is included in the same Arizona income tax return as the owner or operator of the international operations center.

(b) Any entity in which the owner or operator of the international operations center is entitled to a distributive share of the entity's income or loss.

(c) Any entity, including a single-member limited liability company, that is disregarded for federal income tax purposes and is directly or indirectly owned wholly or in part by the owner or operator of the international operations center.

"Biomass" means organic material that is available on a renewable or recurring basis, including:

(a) Forest-related materials, including mill residues, logging residues, forest thinnings, slash, brush, low-commercial value materials or undesirable species, salt cedar and other phreatophyte or woody vegetation removed from river basins or watersheds and woody material harvested for the purpose of forest fire fuel reduction or forest health and watershed improvement.

(b) Agricultural-related materials, including orchard trees, vineyard, grain or crop residues, including straws and stover, aquatic plants and agricultural processed coproducts and waste products, including fats, oils, greases, whey and lactose.

(d) Solid woody waste materials, including landscape or right-of-way tree trimmings, rangeland maintenance residues, waste pallets, crates and manufacturing, construction and demolition wood wastes, but excluding pressure-treated, chemically treated or painted wood wastes and wood contaminated with plastic.

(e) Crops and trees planted for the purpose of being used to produce energy.

(f) Landfill gas, wastewater treatment gas and biosolids, including organic waste by-products generated during the wastewater treatment process.

"International operations center" means a facility or connected facilities under the same ownership that are subject to the investment thresholds under subsection D of this section and that self-consume renewable energy from a qualified facility pursuant to subsection D of this section.
"Renewable energy facility" means a facility in which the owner, operator or affiliated entity, or a third-party entity on behalf of and for the benefit of the taxpayer, owner, operator or affiliated entity, invested at least $30,000,000, that has at least twenty megawatts of generating capacity or a minimum typical annual generation of forty thousand megawatt hours, that is located on land in this state and that produces electricity using a renewable energy resource.
"Renewable energy resource" means a resource that generates electricity by using only the following energy sources:

(a) Solar light.

(b) Solar heat.

(d) Biomass, including fuel cells supplied directly or indirectly with biomass generated fuels.

(e) Battery storage that is independent from or coupled with other sources.

"Utility relief" means the mitigation of the tax burden on the retail purchaser of electricity or natural gas through the application of section 42-5063, subsection C, paragraph 7, section 42-5159, subsection G, paragraph 2 and section 42-6012, paragraph 2.

§ 41-1525 Arizona quality jobs incentives; tax credits for new employment; qualifications; definitions

A. The owner of a business that is located in this state before July 2025 is eligible for income tax credits under section 43-1074 or 43-1161 or an insurance premium tax credit under section 20-224.03 for net increases in full-time employees residing in this state and hired in qualified employment positions in this state.

B. To qualify under this section, and subject to preapproval by the authority, the business must meet at least one of the following requirements for each location of the business before it claims a first year tax credit for the location:

Invest at least $5,000,000 of capital investment and create at least twenty-five net new qualified employment positions that pay compensation at least equal to one hundred percent of the county median wage as computed annually by the authority in an urban location.
Invest at least $2,500,000 of capital investment and create at least twenty-five net new qualified employment positions that pay compensation at least equal to one hundred twenty-five percent of the county median wage as computed annually by the authority in an urban location.
Invest at least $1,000,000 of capital investment and create at least twenty-five net new qualified employment positions that pay compensation at least equal to one hundred fifty percent of the county median wage as computed annually by the authority in an urban location.
Invest at least $500,000 of capital investment and create at least twenty-five net new qualified employment positions that pay compensation at least equal to two hundred percent of the county median wage as computed annually by the authority in an urban location.
Invest at least $1,000,000 of capital investment and create at least five net new qualified employment positions that pay compensation at least equal to one hundred percent of the county median wage as computed annually by the authority in a rural location.
Invest at least $500,000 of capital investment and create at least five net new qualified employment positions that pay compensation at least equal to one hundred twenty-five percent of the county median wage as computed annually by the authority in a rural location.
Invest at least $100,000 of capital investment and create at least five net new qualified employment positions that pay compensation at least equal to one hundred fifty percent of the county median wage as computed annually by the authority in a rural location.

C. The capital investment and the new qualified employment positions requirements of subsection B of this section must be accomplished within twelve months after the start of the required capital investment. Credit may not be claimed until both requirements are met. A business that meets the requirements of subsection B of this section for a location is eligible to claim first year credits for three years beginning with the taxable year in which those requirements are completed. Employees hired at the location before the beginning of the taxable year but during the twelve-month period allowed in this subsection are considered to be new employees for the taxable year in which all of those requirements are completed. The employees that are considered to be new employees for the taxable year under this subsection shall not be included in the average number of full-time employees during the immediately preceding taxable year until the taxable year in which all of the requirements of subsection B of this section are completed. An employee working at a temporary worksite in this state while the designated location is under construction is considered to be working at the designated location if all of the following occur:

The employee is hired after the start of the required investment at the designated location.
The employee is hired to work at the designated location after it is completed.
The payroll for the employees destined for the designated location is segregated from other employees.
The employee is moved to the designated location within thirty days after its completion.

D. Not more than ten thousand new jobs for all employers qualify for first year credits each year.

E. To claim a tax credit, the business must:

Obtain preapproval from the authority at a time, on a form and in a manner prescribed by the authority. Preapproval shall cover all first year credits intended to be claimed for the designated location and all second and third year credits associated with those first year credits.
Certify to the department of revenue or the department of insurance and financial institutions, as applicable, on or before the due date of the tax return, including any extensions for the year for which the credit is claimed, in a form prescribed by the department, including electronic media, information that the department may require, including the ownership interests of co-owners of the business if the business is a partnership, limited liability company or an S corporation, and the following information for each employee in the designated location:

(a) The date of initial employment.

(b) The number of hours worked during the year.

(d) The employee's annual compensation.

(e) The total cost of health insurance for the employee and the cost paid by the employer.

(f) Other information required by the department.

Report and certify to the authority the following information, and provide supporting documentation, on a form and in a manner approved by the authority, and as specified in subsection F of this section, for each year in which the taxpayer earned and claimed or used credits or is carrying forward amounts from previously earned and claimed credits:

(a) The business name and mailing address and any other contact information requested by the authority.

(b) The physical address of the business location or locations and the number of employees qualified for the credit at each location.

(c) The average hourly wage and the total amount of compensation paid to employees qualified for the credit and for all employees.

(d) The total number of qualified employment positions and the amount of income tax or premium tax credits qualified for in the taxable year.

(e) The estimated amount of tax credits to be used in the taxable year to offset tax liability.

(f) The estimated amount of tax credits to be available for carryforward in the taxable year and the year in which the credits expire.

(g) The number of jobs and the amount of credits earned and claimed on the prior year's tax return.

(h) The amount of credits used to offset tax liabilities on the prior year's tax return.

(i) The amount of credits available for carryforward as reported on the prior year's tax return and the year the credits expire.

(j) Capital investment made during the taxable year and the preceding taxable year.

(k) Other information necessary for the management and reporting of the incentives under this section.

For any year in which the taxpayer is claiming first year credits, report and certify the following additional information and provide supporting documentation to the authority on a form and in a manner approved by the authority, and as specified in subsection F of this section:

(a) That the net increase in the number of qualified employment positions for which credit is sought is the least of:

(i) The total number of filled qualified employment positions created at the designated location or locations during the taxable year.

(ii) The difference between the average number of full-time employees in this state in the current taxable year and the average number of full-time employees in this state during the immediately preceding taxable year.

(b) That all employees filling a qualified employment position were employed for at least ninety days during the first taxable year. Employees hired in the last ninety days of the taxable year are excluded for that taxable year and are considered to be new employees in the following taxable year.

(c) That none of the employees filling qualified employment positions were employed by the taxpayer during the twelve months before the current date of hire except for those relocating to this state.

(d) That all employees for whom second and third year credits are claimed are in qualified employment positions for which first year credits were allowed and claimed by the taxpayer on the original first and second year tax returns.

(e) That all employees for whom credits are taken performed their job duties primarily at the designated locations of the business.

F. To qualify for first year credits, the report and certification prescribed by subsection E, paragraphs 3 and 4 of this section must be filed with the authority by the earlier of six months after the end of the taxable year in which the qualified employment positions were created or by the date the tax return is filed for the taxable year in which the qualified employment positions were created. To qualify for second year credits, the report and certification prescribed by subsection E, paragraph 3 of this section must be filed with the authority by the earlier of six months after the end of the taxable year or the date the tax return is filed for the taxable year in which the second year credits are allowable. To qualify for third year credits, the report and certification prescribed by subsection E, paragraph 3 of this section must be filed with the authority by the earlier of six months after the end of the taxable year or the date the tax return is filed for the taxable year in which the third year credits are allowable.

G. Any information submitted to the authority under subsection E, paragraph 3, subdivisions (e) through (j) of this section is exempt from title 39, chapter 1, article 2 and considered to be confidential and is not subject to disclosure except:

To the extent that the person or organization that provided the information consents to the disclosure.
To the department of revenue for use in tax administration.

H. Documents filed with the authority, the department of insurance and financial institutions and the department of revenue under subsection E of this section shall contain either a sworn statement or certification, signed by an officer of the company under penalty of perjury, that the information contained is true and correct according to the best belief and knowledge of the person submitting the information after a reasonable investigation of the facts. If the document contains information that is materially false, the taxpayer is ineligible for the tax credits described under subsection A of this section and is subject to recovery of the amount of tax credits allowed in preceding taxable years based on the false information, plus penalties and interest.

I. The authority may make site visits to a taxpayer's facilities if it is necessary to further document or clarify reported information. The taxpayer must freely provide the access.

J. The authority by rule shall prescribe preapproval requirements and additional reporting requirements for taxpayers who claim tax credits pursuant to this section.

K. On or before September 30 of each year, the authority shall transmit a report to the governor, the president of the senate, the speaker of the house of representatives and the chairpersons of the senate finance committee and the house of representatives ways and means committee and provide a copy of the report to the secretary of state. The report shall include the following information:

The business names, locations, number of employees and amount of compensation paid to employees qualifying for income tax credits as reported to the authority.
The amount of capital investment made during the preceding fiscal year and cumulatively.
The total amount of income tax credits allowed for the preceding taxable year and the number of qualified employment positions for which credits were claimed pursuant to sections 43-1074 and 43-1161.

L. For the purposes of this section:

"Capital investment" means an expenditure to acquire, lease or improve property that is used in operating a business, including:

(a) Land, buildings, machinery and fixtures.

(b) For taxable years beginning from and after June 30, 2011, equipment.

"Designated location" means the location at which the required capital investment is made under subsection B of this section.
"Location" means a single parcel or contiguous parcels of owned or leased land in this state, the structures and personal property contained on the land or any part of the structures occupied by the owner. Parcels that are separated only by a public thoroughfare or right-of-way are considered to be contiguous but a single contiguous parcel that is located in both an urban location and a rural location is considered to be a contiguous urban location.
"Qualified employment position" means employment that meets the following requirements:

(a) The position consists of at least one thousand seven hundred fifty hours per year of full-time permanent employment.

(b) The job duties are performed primarily at the location or locations of the business in this state.

(c) The employment provides health insurance coverage for the employee for which the employer pays at least sixty-five percent of the premium or membership cost. If the business is self-insured, the employer pays at least sixty-five percent of a predetermined fixed cost per employee for an insurance program that is payable whether or not the employee has filed claims.

(d) The employer pays compensation at least equal to the wage threshold as described in subsection B of this section.

"Rural location" means a location that is within the boundaries of tribal lands or a city or town with a population of less than fifty thousand persons or a county with a population of less than eight hundred thousand persons.
"Urban location" means a location that is within the exterior boundaries of a city or town that has a population of fifty thousand persons or more and that is located in a county that has a population of eight hundred thousand persons or more.

§ 41-1526 Authority review; applications; rural e-Connectivity pilot program

A person who is eligible to apply for the rural e-connectivity pilot program established pursuant to section 779 of the consolidated appropriations act, 2018 (P.L. 115–141; 132 Stat. 348) may request that the authority review the person's application for accuracy. The authority may not deny an applicant's request pursuant to this section.

§ 41-1527 Arizona-Ireland trade commission; membership; duties; annual report

A. The Arizona-Ireland trade commission is established in the authority. The commission membership consists of:

Two members who have knowledge of or any involvement in organizations that promote Irish affairs or who have interest in the well-being of trade relations between this state and Ireland. The president of the senate shall appoint these members.
Two members who have knowledge of or any involvement in organizations that promote Irish affairs or who have interest in the well-being of trade relations between this state and Ireland. The speaker of the house of representatives shall appoint these members.
Five members who are appointed by the governor, including:

(a) At least one member from a public institution of higher education.

(b) The chief executive officer or the chief executive officer's designee.

(c) At least two members of the public who are from different political parties and who represent Irish-American communities or interests in this state.

B. All appointments shall be made not later than December 31, 2024, and shall be for a term of four years. All vacancies shall be filled in the same manner as the initial appointment. Appointed members of the commission shall receive compensation as determined pursuant to section 38-611 for each day actually spent in the performance of official duties and are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

C. The commission may accept gifts, grants, donations, monies from fundraising activities, bequests and other forms of voluntary contributions to carry out the purposes of the commission.

D. The commission shall:

Annually elect a chairperson and vice chairperson from among its members.
Meet at least annually and at the call of the chairperson.
Advance bilateral trade and investment between this state and Ireland.
Initiate joint action on policy issues of mutual interest between this state and Ireland.
Promote business and academic exchanges between this state and Ireland.
Encourage mutual economic support between this state and Ireland.
Encourage mutual investment in the infrastructure of this state and Ireland.
On or before December 31, 2025 and each year thereafter, submit an annual report containing the commission's findings, results and recommendations to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of this report to the secretary of state.

§ 41-1528 Municipality time frames advisory committee; membership; duties

A. The municipality time frames advisory committee is established consisting of the following members jointly appointed by the president of the senate and the speaker of the house of representatives:

One member who is an economist.
One member who represents the homebuilding industry in this state.
One member who represents a tax research organization in this state.
One member who represents a statewide association of businesses in this state.
One member who represents a national association in this state that is comprised of private, independently owned and operated businesses in this state.

B. Members of the advisory committee shall serve five-year terms. The initial members shall assign themselves by lot to one term of three years, two terms of four years and two terms of five years in office.

C. The advisory committee shall submit recommendations to the authority relating to municipal and county support for economic development projects to be added to the data reported pursuant to section 41-1504, subsection F.

§ 41-1529 Electric aviation educational materials

The authority shall provide educational materials to local and regional jurisdictions on the benefits of electric powered lift aircraft and advanced air mobility as defined in section 28-9001.

Article 4 Arizona Job Training Program

§ 41-1544 Arizona job training fund; definitions

A. The Arizona job training fund is established consisting of legislative appropriations, gifts, grants and other monies. The authority shall administer the fund. On notice from the chief executive officer, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

B. The chief executive officer may accept and expend federal monies and private grants, gifts and contributions to assist in carrying out the purposes of this article. All monies for the program shall be expended only for the costs related to training. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations, except that:

Monies in the fund may not be encumbered from and after December 31, 2020.
Monies in the fund that are unencumbered on January 1, 2021 revert to the state general fund.
All monies remaining in the fund on June 30, 2022 revert to the state general fund.

C. The fund monies shall be spent on approval of the authority at the direction of the chief executive officer in accordance with the guidelines and procedures adopted by the workforce Arizona council.

D. A minimum of twenty-five percent of the monies appropriated to the fund shall be used to provide training to small businesses employing fewer than one hundred employees.

E. A minimum of twenty-five percent of the monies appropriated to the fund shall be used to provide training to businesses located in rural areas of this state.

F. If a business receives monies for training from the fund and the business employs fewer than one hundred employees and is located in a rural area of this state, the business shall be included in the minimum percentages prescribed in subsections D and E of this section.

G. Not more than fifty percent of the monies in the fund shall be used to provide incumbent worker training.

H. A single grant awarded pursuant to this article may not be more than one million three hundred thousand dollars.

I. The authority may not approve grant monies for reimbursement of the following employer costs:

Fringe benefits, food and beverages, recruitment and signing bonuses for trainees and trainers.
Employer costs to complete a program application.
Except for small businesses, training expenses for partners or corporate officers.
Employee relocation expenses.
Training or course development costs that are not part of the employer's approved training plan.
Costs for assessing the training needs of employees.
Drug or other testing costs for employee screening or prescreening purposes.
Costs for trade shows and conferences or seminars that do not result in a skill certificate that is earned by an employee.
Other costs prohibited by rule.

J. For the purposes of this section:

"Rural area" means either:

(a) A county with a population of less than seven hundred fifty thousand persons.

(b) A census county division with less than fifty thousand persons in a county with a population of seven hundred fifty thousand or more persons.

"Small business" means a concern, including its affiliates, that employs fewer than one hundred employees.

Article 5 Arizona Competes

§ 41-1545 Definitions

In this article, unless the context otherwise requires:

"Arizona basic enterprise" means any enterprise that is located or principally based in this state and that can provide demonstrable evidence that it meets one or more of the following:

(a) It is primarily engaged in one or more of the Arizona basic industries.

(b) It is the national or regional corporate headquarters of an Arizona basic industry or the corporate or regional headquarters of a multistate enterprise that is primarily engaged in out-of-state industrial activities.

"Arizona basic industry" means any of the following:

(a) Manufacturing industries identified by North American industry classification system code sectors 31, 32 and 33.

(b) Producing goods or services that derive at least sixty-five percent of revenue from out-of-state sales.

(d) National or regional headquarters or back-office operations supporting a national or regional company.

(e) Warehouse distribution operations identified by North American industry classification system code sector 42 if sixty-five percent of inventory is shipped out of state.

"Authority" means the Arizona commerce authority.
"Employee" means a person employed in a new job.
"Employer" means an Arizona basic enterprise providing new jobs in conjunction with a project, except that the following do not qualify for the purposes of this article:

(a) Any corporation, partnership or other entity conducting a business identified by any of the following North American industry classification system code groups, sectors or subsectors:

(i) Industry group 7132 or 8131.

(ii) Sector 44, 45, 61, 92 or 221, including water and sewer services.

(iii) Subsector 722.

(b) Any corporation, partnership or other entity that is delinquent in the payment of any unprotested taxes or other amounts due to the federal government, this state or any political subdivision of this state.

(c) Any corporation, partnership or other entity that is currently in bankruptcy or has publicly announced its intention to file for bankruptcy protection.

"Full-time" means permanent employment for at least one thousand seven hundred fifty hours per year.
"Headquarters" means a principal central administrative office where primary headquarters related functions and services are performed, including financial, personnel, administrative, legal, planning and similar business functions.
"Microenterprise" means any business that is located or principally based in this state and that employs ten or fewer employees. Microenterprise includes a start-up business, a home-based business and a self-employed business.
"New job" means full-time employment in a new or expanding Arizona basic enterprise that pays an average annual wage equal to at least one hundred percent of the median wage by county as determined annually by the Arizona commerce authority and includes health insurance for employees for which the employer pays at least sixty-five percent of the premium or membership cost, but not including jobs of recalled workers or existing jobs that are vacant or other jobs that formerly existed in the enterprise in this state.
"Primarily engaged" means at least one-half of the gross income of the enterprise is derived from the engagement.

§ 41-1545.01 Arizona competes fund

A. The Arizona competes fund is established consisting of:

Withholding tax revenues allocated to the fund from the job creation withholdings clearing account pursuant to section 43-409, subsection B, paragraph 2.
Any other amounts dedicated to the fund by law.
Gifts, grants and other donations received for that purpose.
Any available monies received from the United States government, including monies from the American recovery and reinvestment act of 2009 (P.L. 111-5).

B. Monies credited to the fund may be deposited in the state treasury or in a bank or other depository pursuant to section 41-1504, subsection D, paragraph 5.

C. The chief executive officer shall administer the fund. On notice from the chief executive officer, the state treasurer shall invest and divest any monies in the fund deposited in the state treasury as provided by section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

D. The chief executive officer shall use monies in the fund exclusively for the purposes of this article.

§ 41-1545.02 Grants from the Arizona competes fund

A. The chief executive officer may negotiate the award of monies from the Arizona competes fund. The monies shall be paid, by grant, for the purposes of:

Attracting, expanding or retaining Arizona basic enterprises that meet the requirements prescribed by subsection B of this section, that achieve the performance and qualification targets developed under subsection C of this section and that enter into an agreement with the chief executive officer as provided by subsection C of this section. In awarding monies pursuant to this paragraph, the chief executive officer shall give preference to job training and infrastructure activities that create private sector jobs.
Supporting and advancing programs and projects for microenterprises, rural businesses, small businesses and business development that enhance economic development.

B. To be eligible to receive a deal closing grant under subsection A, paragraph 1 of this section, an applicant must:

Be in good standing under the laws of the state in which the applicant was formed or organized, as evidenced by a certificate issued by the secretary of state or other state official having custody of the records pertaining to entities or other organizations formed under the laws of that state.
Owe no delinquent taxes to a taxing jurisdiction in this state.
Qualify as an Arizona basic industry.
Pay compensation that exceeds, on average, one hundred percent of the median wage by county as determined annually by the authority.
Include health insurance for employees for which the applicant pays at least sixty-five percent of the premium or membership cost.
Demonstrate by analysis by an independent third party that estimated income, property and transaction privilege tax and government fee revenues in this state will exceed state incentives.

C. Before awarding a grant from the fund under this section, the chief executive officer must enter into a written agreement with the applicant specifying that:

A reasonable percentage of the total amount of the grant may be withheld until the recipient meets specified performance targets.
If the chief executive officer finds that the grant recipient has not met each of the performance targets specified in the agreement as of a date stated in the agreement:

(a) The recipient must repay the grant and any related interest to this state at an agreed rate and on agreed terms. The repayment may be prorated to reflect partial attainment of performance targets.

(b) The chief executive officer shall not disburse any remaining grant money to the recipient under the agreement.

If any part of the grant is used to build a capital improvement, this state may:

(a) Retain a lien or other security interest in the improvement in proportion to the percentage of the grant amount used to pay for the improvement.

(b) Require the recipient, if the improvement is sold, to:

(i) Repay to this state the grant monies used to pay for the improvement, with interest at a rate and according to terms stated in the agreement.

(ii) Share with this state a proportionate amount of any profit realized from the sale.

D. The chief executive officer shall report to the president of the senate and speaker of the house of representatives on a quarterly basis regarding any amendments to any written agreement executed pursuant to subsection C of this section. The chief executive officer shall track the status and completion of any agreement provisions and amendment provisions and retain supporting documentation for inspection on request.

E. The chief executive officer must determine:

The performance targets and dates required to be included in each grant agreement.
If the grant agreement includes withholding a percentage of the grant until the recipient meets the performance targets, the percentage of the grant money to be withheld.

F. Before awarding a grant from the fund under this section, the authority must prepare a written statement, signed by the chief executive officer, that, specifically and in detail, assesses the direct economic impact of the grant. The statement must:

Include a finding that the enterprise is clearly in the best interests of this state.
Set forth the evidence and reasons supporting this finding, including:

(a) The estimated annual tax revenue accruing to this state and its political subdivisions as a direct or indirect result of the enterprise.

(b) The public benefit of the enterprise from the employment base, including the estimated number and the median wage of jobs to be created in this state by the potential recipient each year.

(c) The extent to which the economic development from the enterprise will raise the standard of living of affected persons, increases free enterprise growth and increases the quality of life in this state.

(d) The ratio of economic benefit from wages paid and capital investment made by the enterprise to the amount of the grant.

(e) The contribution from the enterprise to the growth of existing businesses and creation of new businesses and business clusters.

(f) Whether the enterprise will provide its employees with benefits such as retirement, child care, educational reimbursements and training.

(g) The percentage of the products or services the enterprise will export outside of this state over the first five years of operation.

(h) Any other information the chief executive officer considers to be necessary for inclusion in the statement.

G. Beginning from and after June 30, 2017, on the last day of each fiscal year, thirty percent of the monies appropriated to the fund in the fiscal year, minus the amount of grants awarded in the fiscal year for the purposes prescribed in subsection A, paragraph 2 of this section, not to exceed the unencumbered monies in the fund on the last day of the fiscal year, are reserved for grants for the purposes prescribed in subsection A, paragraph 2 of this section. Of the amount reserved for grants under this subsection, thirty percent or an amount not to exceed $1,000,000 shall be used for grants to support and advance microenterprise development in this state.

H. In addition to the monies reserved pursuant to subsection G of this section, at least twenty-five percent of the monies appropriated to the fund each year shall be reserved to support and advance activities and projects for businesses located in a county with a population of less than two million persons or on tribal lands, or both. Monies not awarded pursuant to this subsection within nine months after the beginning of the fiscal year may be awarded to activities and projects for businesses that are located in any county. In awarding monies reserved pursuant to this subsection, the chief executive officer shall give priority to a county that is located along the Arizona-Mexico border or a county in which a military facility is located or to projects located on tribal lands.

§ 41-1545.03 Annual report by grant recipient

On or before December 31 of each year, each entity that receives a grant under this article shall submit to the chief executive officer a progress report containing the information compiled during the preceding calendar year regarding the attainment of each of the performance targets in the grant agreement.

§ 41-1545.04 Report on use of monies in the Arizona competes fund

A. On or before November 1 of each year, the authority shall submit to the president of the senate, the speaker of the house of representatives and the joint legislative budget committee a report on grants made from the Arizona competes fund under this article in the preceding fiscal year and all projects currently being funded from the Arizona competes fund. The authority shall provide a copy of the report to the secretary of state and post a copy on the authority's website. The report shall include:

The name of each grant recipient.
The number of direct jobs each grant recipient committed to create in this state in connection with the grant.
The number of direct jobs each grant recipient actually created in this state in connection with the grant.
The number of direct jobs each grant recipient actually created in comparison to the number of jobs that the recipient committed to create in the state in connection with the grant.
The average annual wage each grant recipient committed to pay for the direct jobs associated with the grant.
The average annual wage each grant recipient actually pays for the direct jobs associated with the grant.
The amount of capital investment each grant recipient committed to spend or allocate in connection with the grant, including any investments by third-party developers of build-to-suit facilities, per project in this state.
The amount of capital investment each grant recipient actually spent or allocated in connection with the grant.
The total amount of grants made to each recipient.
The average amount of money granted from the Arizona competes fund for each job created in this state by grant recipients.
The number of jobs created in this state by grant recipients in each sector of the North American industry classification system.
Of the number of direct jobs each recipient created in this state, the percentage of the health insurance premium or membership cost offered by the recipient to employees.
The total amount of grants issued by the authority since the last annual report.

B. The report shall not include information that is made confidential by law.

C. The authority may require grant recipients to submit information in a form required to complete the report.

§ 41-1545.05 Program termination

The program established by this article ends on July 1, 2026.

Article 6 Arizona Space Commission

§ 41-1551 Definitions

In this article, unless the context otherwise requires:

"Board" means the board of directors of the commission.
"Commission" means the Arizona space commission.
"Fund" means the space exploration and aeronautics research fund.

§ 41-1551.01 Arizona space commission; board of directors; membership; powers and duties; annual plan

A. The Arizona space commission is established. The commission is governed by a board of directors consisting of seven members who are appointed by the governor, three members who are appointed by the president of the senate and three members who are appointed by the speaker of the house of representatives.

B. When making the appointments to the board pursuant to subsection A of this section, priority shall be given to all of the following:

Individuals with experience in any of the following:

(a) Commercial aerospace.

(b) Civil aviation.

(d) Space economic development.

(e) Space-related academic research.

(f) Nonprofit space economy support.

(g) Real estate.

(h) Finance.

Individuals with a master's degree or above in any of the following disciplines:

(a) Space science.

(b) Space engineering.

(d) Space business.

(e) Space leadership.

(f) Space policy.

(g) Space law.

(h) Space operations.

Individuals from an early stage start-up company that focuses on the development and commercialization of new technologies related to space.
Individuals with experience working in industries that are based in this state and that are part of the space value chain or that are in downstream industries with a significant presence in this state.

C. The initial members shall assign themselves by lot to terms of two, four and six years in office. All subsequent members of the board shall serve six-year terms in office. All vacancies shall be filled in the same manner as the initial appointment within thirty days after the vacancy.

D. The board shall:

Elect a chairperson from among the members of the board.
Direct the activities of, establish goals for and provide oversight of the commission.
Establish standards to ensure the proper use of fund monies.
Identify research and funding opportunities within this state that do the following:

(a) Strengthen and enhance this state's position in civil, commercial and military aeronautics research and development and space flight infrastructure.

(b) Enhance the integration of the space aeronautics, astronautics and aviation industries in this state.

Promote and assist developing workforce training to advance emerging technologies required for all aspects of space exploration.
Solicit proposals for funding and research opportunities related to the objectives of this section.

E. The board may:

Appoint an ad hoc advisory committee as necessary to carry out the board's duties pursuant to this section.
Acquire and convey property or an interest in property in this state.
Engage in planning and implementing of aerospace-related educational opportunities in this state.

F. The authority shall provide staff support to the commission.

G. The commission shall develop and annually update a strategic plan for promoting and expanding space, aeronautics and aviation in this state, including a list of potential projects to further the purposes of the commission. The commission shall include both of the following for each potential project:

The estimated total cost for the project, including any available matching state monies.
An assessment of the availability of external funding sources.

H. The board shall conduct a hearing to review and amend or approve the strategic plan.

I. On or before December 31, 2024 and each even-numbered year thereafter, the commission shall submit the strategic plan to the governor, the president of the senate and the speaker of the house of representatives.

§ 41-1551.02 Space exploration and aeronautics research fund; report

A. The space exploration and aeronautics research fund is established consisting of legislative appropriations and gifts, grants and donations. Monies in the fund are continuously appropriated. The board shall administer the fund. The board may use up to ten percent of the monies for administrative costs. Monies in the fund may be used to provide grants to businesses or nonprofit organizations in this state that are involved in the space exploration or aeronautics industry or to a governmental entity with which the board has entered into an intergovernmental agreement.

B. The grant monies shall be used for any of the following purposes:

Developing emerging technologies that are required for any aspect of human space flight.
Research involving space exploration and space flight.
Workforce training to promote space exploration and space flight.
Curating postmission materials involved in space exploration and space flight.
Developing infrastructure that is necessary for establishing and maintaining a spaceport.

C. The board may also provide grants for multiyear projects. The board shall specify the total amount of monies approved to fund each multiyear project.

D. The board shall prioritize providing grants for projects that are any of the following:

Located within fifty miles of a federal aviation administration-licensed spaceport.
Space defense-related.
Space defense and commercial use-related.

E. The board shall establish standards to ensure that grant recipients pursuant to this section purchase goods and services from suppliers in this state to the extent reasonably possible.

F. Each grant recipient shall submit a report to the board that describes how grant monies were spent and a summary of any findings.

G. The board shall prescribe a simplified form and procedure to apply for grants pursuant to this section.

Article 7 Office of Defense Innovation

§ 41-1561 Office of defense innovation; powers; annual report

A. The office of defense innovation is established within the authority.

B. The office may:

Act as a liaison between this state, the United States department of defense and national security organizations, including federal and state agencies and law enforcement and industries that support the purposes in this subsection.
Identify and pursue, as appropriate, opportunities to increase the amount of federal funding to foster the development of products, services and technologies that support the United States department of defense in this state.
Support any ongoing United States department of defense industry development mission that is directed at this state.
Support Arizona-based companies that seek federal defense contracts.
Advance Arizona's economic interests that are related to the United States department of defense's aerospace mission and defense sectors and industries.
Develop and implement a reoccurring strategic plan to enhance Arizona's competitiveness in defense-related industries.
Identify and support emerging technology, including commercialization support services to accelerate technology development.
Collaborate with the Arizona board of regents and universities and research institutions that seek to increase the amount of defense research and development funding for applied research and advance prototyping of critical defense-related products and technologies; support rapid technology transfer and transition capabilities.
Collaborate to enhance workforce development that prepares innovators and intrapreneurs to support industries of the future.
Coordinate with the governor and the legislature on the office's activities, achievements and recommendations.

C. On or before December 31, 2026 and each year thereafter, the office shall submit a report regarding the activities and recommendations to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of the report to the secretary of state.

Chapter 11 State Department of Corrections

Article 1 Organization of State Department of Corrections

§ 41-1601 Definitions

In this chapter, unless the context otherwise requires:

"Department" means the state department of corrections.
"Director" means the director of the state department of corrections.

§ 41-1602 State department of corrections; purpose

A. There shall be a state department of corrections.

B. The department shall have as its purpose the objective of encompassing the various institutions, facilities and programs which are now or may become a part of the correctional program of the state, and to provide the supervisory staff and administrative functions at the state level of all matters relating to the institutionalization, rehabilitation and community supervision functions of all adult offenders.

§ 41-1603 Director; appointment; qualifications; compensation

A. The director of the department shall be appointed by the governor pursuant to section 38-211, and shall serve at the pleasure of the governor.

B. The director, as minimum qualifications, shall have administrative experience in adult correctional programs and qualifications and training which enable the director to manage the affairs of a modern penal system.

C. The compensation of the director shall be as determined pursuant to section 38-611.

§ 41-1603.01 Director; reporting; website; posting; notification

A. Notwithstanding any other law, the director may post on the department's website the information from all statutorily required reports, forms, plans and summaries.

B. The information from all statutorily required reports, forms, plans and summaries that is posted on the department's website pursuant to subsection A of this section shall be treated as if the department submitted the report, form, plan or summary to the relevant entity. The director shall notify all of the relevant entities that the information for the reports, forms, plans and summaries has been posted on the department's website.

§ 41-1604 Duties and powers of director

A. The director shall:

Be responsible for the overall operations and policies of the department.
Maintain and administer all institutions and programs within the department, including prisons, reception and diagnostic centers, conservation camps, community correctional centers and such other facilities and programs as may be required and established for the custody, control, correction, treatment and rehabilitation of all adult offenders who are committed to the department.
Be responsible for the administration and execution of all community supervision services, including those for adult offenders who are released in accordance with law.
Develop a program to provide uniform statewide community supervision field services in this state and employ parole or community supervision officers based on qualifications prescribed by the director, including physical, psychological and educational qualifications and practical experience.
Be responsible for the development of policies and programs that shall be recommended to the governor and the legislature for the purpose of improving the various adult correctional programs of this state.
Develop and establish a uniform statewide method of reporting statistics as related to this chapter.
Subject to chapter 4, article 4 of this title, employ deputy directors and other key personnel based on qualifications prescribed by the director that require education and practical experience.
Adopt rules pursuant to chapter 6 of this title for the development of incentives to encourage good behavior and the faithful performance of work by prisoners.
Adopt rules pursuant to chapter 6 of this title to limit inmate access to the internet through the use of a computer, computer system, network, computer service provider or remote computing service.
Cooperate with the Arizona-Mexico commission in the governor's office and with researchers at universities in this state to collect data and conduct projects in the United States and Mexico on issues that are within the scope of the department's duties and that relate to quality of life, trade and economic development in this state in a manner that will help the Arizona-Mexico commission to assess and enhance the economic competitiveness of this state and of the Arizona-Mexico region.

B. The director may:

Adopt rules to implement the purposes of the department and the duties and powers of the director.
Take any administrative action to improve the efficiency of the department, including the following:

(a) Create new divisions or units or consolidate divisions or units.

(b) Subject to chapter 4, article 4 of this title, transfer employees between the various divisions and units of the department.

(d) Delegate to appropriate personnel the administrative functions, powers or duties that the director believes can be competently, efficiently and properly performed. The director shall not delegate the responsibilities in subsection A, paragraphs 1 and 5 of this section.

(e) Transfer adult inmates between adult institutions or adult facilities.

(f) Authorize work crews to perform acceptable tasks in any part of this state.

(g) Accept unconvicted persons pursuant to a court order for the purposes of examination and treatment regarding competency to understand any stage of a criminal proceeding after indictment or information or their ability to assist in their own defense.

(h) Accept convicted yet unsentenced persons pursuant to a court order for the purposes of conducting a mental health examination or a diagnostic evaluation.

(i) Subject to chapter 4, article 4 and, as applicable, article 5 of this title, appoint certain employees of the department to peace officer status for the purposes of guarding, transporting or pursuing persons who are under the jurisdiction of the department and appoint certain employees of the department to peace officer status for the purposes of investigating or arresting persons who commit or attempt to commit offenses directly relating to the operations of the department. Peace officers of the department shall not preempt the authority and jurisdiction of established agencies of this state and political subdivisions of this state. Such officers shall notify agencies of this state and political subdivisions of this state before conducting an investigation within the jurisdiction of the agency and before making an arrest within the jurisdiction of the agency and shall ask, except in an emergency, if the agency wishes to participate, perform the investigation or arrest the person to be arrested before proceeding. Personnel who are appointed as peace officers by the director shall have the minimum qualifications established for peace officers pursuant to section 41-1822. Personnel who are appointed by the director pursuant to this subdivision are not eligible to participate in the public safety personnel retirement system except as otherwise provided in title 38, chapter 5, article 4.

(j) Operate travel reduction programs that are subsidized by the department for employees who commute between work and home by vanpools, carpools and buses or in vehicles that are purchased or leased by the department.

Establish by rule a onetime fee for conducting background checks on any person who enters a department facility to visit a prisoner. A fee shall not be charged for a person who is under eighteen years of age. The director may adopt rules that waive all or part of the fee. The director shall deposit, pursuant to sections 35-146 and 35-147, any monies collected pursuant to this paragraph in the department of corrections building renewal fund established by section 41-797.

§ 41-1604.01 Authorization for care

When any person under the jurisdiction of the department of corrections other than employees is in need of medical, surgical or dental care, and a spouse, adult next of kin or legal guardian is not immediately available or has not previously given authorization for such care, the director of the department of corrections or his authorized representative, upon the recommendation of the attending physician or dentist, may authorize the performance of such necessary medical, surgical or dental service.

§ 41-1604.02 Inmate stores; establishment; privatization; prices; goods; inmate store proceeds fund

The department may establish and maintain an inmate store at any prison, institution or facility. The department shall enter into a contract or contracts with a private entity or entities to establish and maintain inmate stores. The department or Arizona correctional industries may also be considered as an entity eligible for award. Such inmate stores shall offer for sale, at prices that are fixed by the contractor with direction from the director and that are no higher than prices of similar retail products, toilet articles, candy, tobacco products, notions and other sundries to the persons confined. The department may provide the facilities necessary to operate such inmate stores. All profit derived from the state's portion of privatization of such inmate stores shall be deposited in an inmate store proceeds fund. The director shall transfer five hundred thousand dollars from the inmate store proceeds fund annually to the department of corrections building renewal fund established by section 41-797. Any remaining monies in the fund may be used at the director's discretion for inmate activities, incentive pay increases for corrections officers, equipment to enhance safety for both department personnel and inmates or other official needs as required.

§ 41-1604.03 Special services fund; uses; report

A. The special services fund is established in the state department of corrections. The department shall administer the fund.

B. The director shall transfer five hundred thousand dollars from the special services fund annually to the department of corrections building renewal fund established by section 41-797. Any remaining monies in the special services fund may be used for the following purposes:

The benefit, education and welfare of committed offenders.
To pay the costs of implementing, operating and maintaining technologies and programs for inmate use. Revenues that are generated by the inmate use of technology, including telephone systems, kiosks and tablets, shall be deposited in the special services fund.

C. On or before August 1 of each year, the department shall submit to the president of the senate and the speaker of the house of representatives a report that contains a full and complete account of special services fund transactions for the preceding fiscal year.

§ 41-1604.04 Investment of special service fund monies; approval; deposit of proceeds

The department may invest, with the approval of the director of the department of administration, any monies in the special service fund that the director determines are not necessary for immediate use. Any proceeds from such investments shall be deposited in the special services fund.

§ 41-1604.05 Investment of offenders' funds; deposit of proceeds; commingling permitted

A. The director may deposit any funds of offenders in his possession with the state treasurer or, subject to the approval of the state treasurer, deposit such funds in interest bearing bank accounts. Any proceeds from such deposits shall be deposited in the special services fund.

B. Funds of individual offenders may be commingled by the department only for the purpose of deposit pursuant to this section.

§ 41-1604.06 Earned release credit eligibility certification; classifications; appeal

A. The director shall develop and maintain an earned release credit eligibility classification system. Within such system, the director shall establish one class of earned release credit eligibility to be given effect as provided for in this section and as many other classes of noneligibility as he deems necessary or desirable. Each person committed to the state department of corrections shall be classified pursuant to the earned release credit eligibility system established by the director.

B. The director shall establish rules pursuant to chapter 6 of this title for the classification and certification of prisoners for purposes of earned release credit. An inmate who is placed in a parole eligible classification is also eligible for certification for absolute discharge from imprisonment. Upon commitment to the state department of corrections each person shall be initially placed in the earned release credit noneligible class. Reclassification and certification shall be based on factors related to a prisoner's record while in the custody of the department, including work performance, compliance with all rules of the department, progress in any appropriate education, training or treatment programs and the performance of any assignments of confidence or trust. The director shall also establish rules governing the procedures and performance standards by which prisoners, classified to noneligibility classifications, may earn eligibility classification. Prisoners may be reclassified only pursuant to the rules of the department. The director shall distribute a copy of all such rules to each person committed to the department.

C. Every prisoner shall be entitled to a hearing prior to reclassification of such prisoner to a noneligible earned release credit class. The hearing shall be before a person or persons designated by the director to hold such hearings. Reasonable notice and a written statement of the alleged violation of the rules shall be distributed to the prisoner at least five days prior to the hearing. A prisoner may request a review of a decision to reclassify the prisoner by delivering a written request to the director.

§ 41-1604.07 Earned release credits; forfeiture; restoration; released prisoner health care; annual report

A. Pursuant to rules adopted by the director, each prisoner who is in the eligible earned release credit class shall be allowed an earned release credit as set forth in subsection B of this section, including time served in county jails, except for those prisoners who are sentenced to serve the full term of imprisonment imposed by the court.

B. The earned release credit is:

Three days for every seven days served if the prisoner:

(a) Was sentenced to a term of imprisonment for the possession or use of marijuana pursuant to section 13-3405, subsection A, paragraph 1, the possession or use of a dangerous drug pursuant to section 13-3407, subsection A, paragraph 1, the possession or use of a narcotic drug pursuant to section 13-3408, subsection A, paragraph 1 or the possession of drug paraphernalia pursuant to section 13-3415.

(b) Has successfully completed a drug treatment program or other major self-improvement program provided by the department during the prisoner's term of imprisonment.

One day for every six days served if the prisoner was sentenced to a term of imprisonment for an offense not listed in paragraph 1 of this subsection.

C. Release credits earned by a prisoner pursuant to subsections A and B of this section shall not reduce the term of imprisonment imposed by the court on the prisoner.

D. On reclassification of a prisoner resulting from the prisoner's failure to adhere to the rules of the department or failure to demonstrate a continual willingness to volunteer for or successfully participate in a work, educational, treatment or training program, the director may declare all release credits earned by the prisoner forfeited. In the discretion of the director, forfeited release credits may subsequently be restored. The director shall maintain an account of release credits earned by each prisoner.

E. A prisoner who has reached the prisoner's earned release date or sentence expiration date shall be released to begin the prisoner's term of community supervision imposed by the court or term of probation if the court waived community supervision pursuant to section 13-603, except that the director may deny or delay the prisoner's release to community supervision or probation if the director believes the prisoner may be a sexually violent person as defined in section 36-3701 until the screening process is complete and the director determines that the prisoner will not be referred to the county attorney pursuant to section 36-3702. If the term of community supervision is waived, the state department of corrections shall provide reasonable notice to the probation department of the scheduled release of the prisoner from confinement by the department. If the court waives community supervision, the director shall issue the prisoner an absolute discharge on the prisoner's earned release credit date. A prisoner who is released on the earned release credit date to serve a term of probation is not under the control of the state department of corrections when community supervision has been waived and the state department of corrections is not required to provide parole services.

F. Notwithstanding subsection E of this section, a prisoner who fails to achieve functional literacy at an eighth grade literacy level shall not be released to begin the prisoner's term of community supervision until either the prisoner achieves an eighth grade functional literacy level as measured by standardized assessment testing, the prisoner is released to enter the transition program established by section 31-281 and is enrolled in a program that prepares the prisoner to achieve functional literacy or the prisoner serves the full term of imprisonment imposed by the court, whichever first occurs. This subsection does not apply to inmates who either:

Are unable to meet the functional literacy standard required by section 31-229.02, subsection A due to a medical, developmental or learning disability as described in section 31-229, subsection C.
Are classified as level five offenders.
Are foreign nationals.
Have less than six months of incarceration to serve on commitment to the department.
Are released pursuant to subsection B, paragraph 1 of this section.

G. The department shall establish conditions of community supervision it deems appropriate in order to ensure that the best interests of the prisoner and the citizens of this state are served. As a condition of community supervision, the director:

May order a released prisoner to participate in an appropriate drug treatment or education program that is administered by a qualified agency, organization or individual approved by the department of health services and that provides treatment or education to persons who abuse controlled substances. Each person who is enrolled in a drug treatment or education program shall pay for the cost of participation in the program to the extent of the person's financial ability.
May order additional conditions, including participation in a rehabilitation program or counseling and performance of community restitution work.
Unless the prisoner is released pursuant to subsection B, paragraph 1 of this section, may order a prisoner to apply for health care benefits through the Arizona health care cost containment system before being released. The state department of corrections shall enter into an enrollment suspense agreement with the Arizona health care cost containment system to reinstate benefits for prisoners who were sentenced to twelve months or less and who were previously enrolled in the Arizona health care cost containment system immediately before incarceration. For all other prisoners, the state department of corrections shall submit a prerelease application to the Arizona health care cost containment system at least thirty days before the prisoner's release date. The state department of corrections may coordinate with community-based organizations or the department of economic security to assist prisoners in applying for enrollment in the Arizona health care cost containment system.
Shall impose, if the prisoner was convicted of a violation of sexual conduct with a minor under fifteen years of age or molestation of a child under fifteen years of age, a prohibition on residing within four hundred forty feet of a school or its accompanying grounds. For the purposes of this paragraph, "school" means any public, charter or private school where children attend classes.

H. The director may exchange a prisoner's health care information with the regional behavioral health authority or Arizona health care cost containment system justice system contact to facilitate the transition to care for released prisoners to access the full array of behavioral and physical health care services, including medication, counseling, case management, substance abuse treatment, and parenting skills and family reunification training. The director shall adopt policies and procedures that establish a care team to convene and discuss the services and resources, including housing and employment supports, that may be needed for the released prisoner to safely transition into the community. The care team shall be managed by the regional behavioral health authority or Arizona health care cost containment system contractor and may include the health care provider that is identified by and has a contract with the regional behavioral health authority or Arizona health care cost containment system contractor. The care team may also include representatives of nonprofit organizations that specialize in assisting prisoners who are transitioning back into the community and other organizations that link prisoners to additional services, including housing and employment.

I. If a prisoner who reaches the prisoner's earned release credit date refuses to sign and agree to abide by the conditions of supervision before release on community supervision, the prisoner shall not be released. When the prisoner reaches the sentence expiration date, the prisoner shall be released to begin the term of community supervision. If the prisoner refuses to sign and agree to abide by the conditions of release, the prisoner shall not be released on the sentence expiration date and shall serve the term of community supervision in prison. The department is required to supervise any prisoner on community supervision until the period of community supervision expires. The department may bring a prisoner who is in violation of the prisoner's terms and conditions before the board of executive clemency.

J. The director, pursuant to rules adopted by the department, shall authorize the release of any prisoner on the prisoner's earned release credit date to serve any consecutive term imposed on the prisoner. The release shall be for the sentence completed only. The prisoner shall remain under the custody and control of the department. The director may authorize the rescission of the release to any consecutive term if the prisoner fails to adhere to the rules of the department.

K. If a prisoner absconds from community supervision, any time spent before the prisoner is returned to custody is excluded in calculating the remaining period of community supervision.

L. A prisoner shall forfeit five days of the prisoner's earned release credits:

If the court finds or a disciplinary hearing held after a review by and recommendations from the attorney general's office determines that the prisoner does any of the following:

(a) Brings a claim without substantial justification.

(b) Unreasonably expands or delays a proceeding.

(d) Submits a claim that is intended solely to harass the party it is filed against.

For each time the prisoner tests positive for any prohibited drugs during the period of time the prisoner is incarcerated.

M. If the prisoner does not have five days of earned release credits, the prisoner shall forfeit the prisoner's existing earned release credits and shall be ineligible from accruing earned release credits until the number of earned release credits the prisoner would have otherwise accrued equals the difference between five days and the number of existing earned release credit days the prisoner forfeits pursuant to this section.

N. The director may authorize temporary release on inmate status of eligible inmates pursuant to rules adopted by the director within ninety days of any other authorized release date. The release authorization applies to any inmate who has been convicted of a drug offense, who has been determined to be eligible for participation in the transition program pursuant to section 31-281 and who has agreed to participate in the transition program.

O. On admission, the department shall provide notice to any prisoner who is potentially eligible for earned release credit pursuant to subsection B, paragraph 1 of this section. The notice must include all of the eligibility requirements under this section.

P. The department shall do all of the following:

Annually report the recidivism rate of prisoners released pursuant to subsection B, paragraph 1 of this section for a minimum of three years after release.
Report the following information at the end of each fiscal quarter:

(a) The number of prisoners who received earned release credits for each month of the reporting period and the percentage of the total prison population that received earned release credits.

(b) The number of prisoners who were eligible for earned release credit pursuant to subsection B, paragraph 1 of this section and for each of these prisoners, the following information:

(i) The most serious crime for which each prisoner is receiving earned release credit.

(ii) The mean and median length of the prison sentences.

(iii) Whether the prisoner received earned release credits each month of the reporting period.

(c) The number of prisoners who participated in a program that is described in subsection B, paragraph 1, subdivision (b) of this section in each month of the reporting period, including the percentage of the total prison population that has participated in those programs.

(d) The number of prisoners who are eligible for release into the transition program established pursuant to section 31-281 in each month of the reporting period and the percentage of the total prison population that is eligible for release into the transition program. For eligible prisoners, the report shall include the following information:

(i) The most serious crime for which each prisoner is serving a sentence.

(ii) The mean and median length of the prison sentences.

(iii) The mean and median length of time served by the prisoners.

(e) The number of prisoners who are enrolled in the transition program in each month of the reporting period, including the percentage of the total prison population that is enrolled in the transition program. For enrolled prisoners, the report shall include the following information:

(i) The most serious crime for which each prisoner is serving a sentence.

(ii) The mean and median length of the prison sentences.

(iii) The mean and median length of time served by the prisoners.

(f) The number of prisoners who are released into the transition program in each month of the reporting period, including the percentage of the total prison population that is released into the transition program. For released prisoners, the report shall include the following information:

(i) The most serious crime for which each prisoner is serving a sentence.

(ii) The mean and median length of the prison sentences.

(iii) The mean and median length of time that the prisoners served.

(g) The six-month success, return to custody and new conviction rates for prisoners who are released to a transition program.

(h) The one-year success, return to custody and new conviction rates for prisoners who are released to a transition program.

(i) The two-year success, return to custody and new conviction rates for prisoners who are released to a transition program.

(j) The three-year success, return to custody and new conviction rates for prisoners who are released to a transition program.

(k) The number of prisoners who received treatment for substance abuse during the first half of the prisoner's total sentence and the percentage of the total prison population that received treatment for substance abuse during the first half of the prisoners' total sentence. For prisoners who received treatment for substance abuse according to this subdivision, report shall include the following information:

(i) The most serious crime committed by each prisoner.

(ii) The mean and median length of the prison sentences.

(iii) Whether the prisoners received treatment for substance abuse each month of the reporting period.

§ 41-1604.08 Global position system monitoring: daily fee; deposit

A. The department shall assign any person who is in the custody of the department and who was convicted of a violation of section 13-705 to a global position monitoring system on the person's release on parole, community supervision, work release or other conditional or temporary release.

B. The department may enter into a contract for the provision of global position monitoring services.

C. The department may charge a person who is assigned to a global position monitoring system a daily fee not to exceed the department's expenses for the system.

D. Monies collected pursuant to this section shall be deposited, pursuant to sections 35-146 and 35-147, in the community corrections enhancement fund established by section 31-418.

§ 41-1604.09 Parole eligibility certification; classifications; appeal; recertification; applicability; definition

A. The director shall develop and maintain a parole eligibility classification system. Within the system, the director shall establish two classes of parole eligibility, class one and class two, to be given effect as provided for in this section, one class of parole noneligibility for dangerous psychiatric offenders and as many other classes of noneligibility as the director deems necessary or desirable. Each person committed to the state department of corrections shall be classified pursuant to the parole eligibility system established by the director.

B. The director shall establish rules pursuant to chapter 6 of this title for the classification and certification of prisoners for purposes of parole. Reclassification and certification shall be based on factors related to a prisoner's record while in the custody of the department, including work performance, compliance with all rules of the department, progress in any appropriate training or treatment programs and the performance of any assignments of confidence or trust. The director shall also establish rules governing the procedures and performance standards by which prisoners, reclassified to noneligibility classifications, may earn eligibility classification. Prisoners may be reclassified only pursuant to the rules of the department. The director shall distribute a copy of all the rules to each person committed to the department.

C. The director shall maintain two classes for parole eligibility, class one and class two. Inclusion of an inmate in class one shall be determined by adherence to the rules of the department and continual willingness to volunteer for or successful participation in a work, educational, treatment or training program established by the department, except that a person sentenced pursuant to a statute that requires that a person serve a mandatory minimum term shall not be placed in class one until one-quarter of the mandatory minimum portion of the term is served and shall not be released until the mandatory minimum portion of the term is served. Inclusion of an inmate in class two shall be determined by adherence to the rules of the department.

D. The director shall certify as eligible for parole any prisoner classified within an eligible classification five months immediately before the prisoner's earliest parole eligibility. The inmate shall be required to remain in a parole eligible classification from the date of certification until the date of release on parole. If the inmate does not remain in a parole eligible classification until the date of release on parole, the entire parole process shall be rescinded. For the purposes of this subsection, the prisoner's earliest parole eligibility occurs when the prisoner has served one-half of the sentence imposed unless the prisoner is sentenced according to any provisions of law that prohibit the release on any basis until serving not less than two-thirds of the sentence imposed by the court, the sentence imposed by the court or any other mandatory minimum term, in which case the prisoner must have served the sentence required by law.

E. Every prisoner shall be entitled to a hearing before reclassification of the prisoner to a lower class. The hearing shall be before a person or persons designated by the director to hold the hearings. Reasonable notice and a written statement of the alleged violation of the rules shall be distributed to the prisoner at least five days before the hearing. A prisoner may request a review of a decision to reclassify the prisoner by delivering a written request to the director.

F. Notwithstanding subsection D of this section, placement of a prisoner in a noneligible parole class except placement in the noneligible parole class for dangerous psychiatric offenders shall result in an increase in the period of time the prisoner must serve before reaching the prisoner's earliest parole eligibility date. The increase shall equal the number of days occurring after placement in a noneligible parole class and before the prisoner is reclassified to a parole eligible class.

G. The classification of each prisoner shall be reviewed by the director not less than once every six months. Any prisoner who was certified as eligible for parole and denied parole and remains eligible for parole pursuant to subsection D of this section shall be recertified by the director not less than one nor more than four months after the hearing at which the prisoner was denied parole, except that the board of executive clemency in denying parole may prescribe that the prisoner shall not be recertified for a period of up to one year after the hearing. The board of executive clemency may adopt rules for the recertification process and may apply specific rules for the recertification process that applies to a prisoner who is serving a sentence for any of the following:

Death in violation of section 13-1104 or 13-1105.
Serious physical injury if the person was sentenced pursuant to section 13-704.
A dangerous crime against children as defined in section 13-705.
A felony offense in violation of title 13, chapter 14 or 35.1.

H. Immediately after the adoption of the rules required pursuant to this section, the director shall forward a certified copy of the rules to the legislature. The legislature may review and, by concurrent resolution, approve, disapprove or modify the rules, except that they shall be given full force and effect pending legislative review. If no concurrent resolution is passed by the legislature with respect to the rules within one year following receipt of a certified copy of the rules, they shall be deemed to have been approved by the legislature. If the legislature disapproves the rules or a section of them, the director shall immediately discontinue the use of any procedure, action or proceeding authorized or required by the rules or section of the rules.

I. This section applies to either of the following:

A person who commits a felony offense before January 1, 1994.
A person who is sentenced to life imprisonment and who is eligible for parole pursuant to section 13-716 or 13-718.

J. Pursuant to rules adopted by the director, on commitment to the department, each prisoner shall be placed in parole class one beginning on the prisoner's sentence begin date.

K. For the purposes of this section, "dangerous psychiatric offender" means an inmate who has been placed in a psychiatric unit for psychiatric evaluation and treatment and who has been determined to present a high risk of potential violence.

§ 41-1604.10 Earned release credits; forfeiture; restoration; applicability

A. Each prisoner classified as parole eligible, class one, pursuant to section 41-1604.09, shall be allowed the following release credits:

If sentenced on a first conviction other than pursuant to section 13-751 or other than for a felony involving a dangerous offense as defined in section 13-105, every two days served within class one shall be counted as an earned release credit of one day.
If sentenced pursuant to section 13-703, subsection B or on first conviction of a class 4, 5 or 6 felony involving a dangerous offense as defined in section 13-105 or any other provisions of law that prohibits release on any basis until serving not less than one-half the sentence imposed by the court, every two days served within class one shall be counted as an earned release credit of one day.
If sentenced pursuant to any other provision of section 13-703, section 13-704, subsection A, B, C, D or E, section 13-706, subsection A or section 13-708, subsection D or any other provision of law that prohibits release on any basis until serving not less than two-thirds the sentence imposed by the court, every three days served within class one shall be counted as an earned release credit of one day.

B. Release credits earned by a prisoner pursuant to subsection A of this section shall not reduce the term of imprisonment imposed by the court on such prisoner, nor reduce the sentence imposed on the prisoner for the purpose of determining such prisoner's parole eligibility.

C. On reclassification of a prisoner resulting from the prisoner's failure to adhere to the rules of the department or failure to demonstrate a continual willingness to volunteer for or successfully participate in a work, educational, treatment or training program, the director may declare any and all release credits earned by the prisoner forfeited. In the discretion of the director the release credits may subsequently be restored. The director shall maintain an account of release credits earned by each prisoner.

D. The director, according to rules adopted by the department, may authorize the release of any prisoner who has earned release credits that, when added to the time served by the prisoner, equal the sentence imposed by the court which shall be the prisoner's earned release credit date. A prisoner on earned release credit release is not under the control of the department and the department is not required to provide parole services or otherwise supervise any prisoner released, except that the department may revoke the release of the prisoner until the final expiration of the prisoner's sentence if the department has reason to believe that the released prisoner has engaged in criminal conduct during the term of release. If a prisoner has a term of probation to be completed or served, the probation department shall begin supervision of the prisoner when the prisoner is released on the earned release credit date. If the prisoner's term of probation equals or exceeds the prisoner's final expiration date, the director of the state department of corrections shall issue the prisoner an absolute discharge on the prisoner's earned release credit date. The prisoner is not under the control of the department and the department is not required to provide parole services or otherwise supervise the prisoner. If the prisoner's term of probation is less than the prisoner's final expiration date, the prisoner is not under the control of the department and the department is not required to provide parole services or otherwise supervise the prisoner, except that the department may revoke the release at any time between the earned release credit date and the final expiration date if the department has reason to believe that the released prisoner has engaged in criminal conduct during the term of release. The director may issue the prisoner an absolute discharge from the sentence of imprisonment if it appears that the prisoner will live and remain at liberty without violating the law and it is in the best interest of the state. The state department of corrections shall provide reasonable notice to the probation department of the scheduled release of the prisoner from confinement by the state department of corrections.

E. A prisoner shall forfeit five days of the prisoner's earned release credits if the court finds or a disciplinary hearing held after a review by and recommendations from the attorney general's office determines that the prisoner does any of the following:

Brings a claim without substantial justification.
Unreasonably expands or delays a proceeding.
Testifies falsely or otherwise presents false information or material to the court.
Submits a claim that is intended solely to harass the party it is filed against.

F. If the prisoner does not have five days of earned release credits, the prisoner shall forfeit the prisoner's existing earned release credits and be ineligible from accruing earned release credits until the number of earned release credits the prisoner would have otherwise accrued equals the difference between five days and the number of existing earned release credit days the prisoner forfeits pursuant to this section.

G. This section applies only to persons who commit felonies before January 1, 1994.

§ 41-1604.11 Order for removal; purposes; duration; work furlough; notice; failure to return; classification; applicability; definition

A. The director of the state department of corrections may authorize the temporary removal under custody from prison or any other institution for the detention of adults under the jurisdiction of the state department of corrections of any inmate for the purpose of employing that inmate in any work directly connected with the administration, management or maintenance of the prison or institution in which the inmate is confined, for purposes of cooperating voluntarily in medical research that cannot be performed at the prison or institution, or for participating in community action activities directed toward delinquency prevention and community betterment programs. The removal shall not be for a period longer than one day.

B. Under specific rules established by the director for the selection of inmates, the director may also authorize furlough, temporary removal or temporary release of any inmate for compassionate leave, for the purpose of furnishing to the inmate medical treatment not available at the prison or institution, for purposes preparatory to a return to the community within ninety days of the inmate's release date or for disaster aid, including local mutual aid and state emergencies. When an inmate is temporarily removed or temporarily released for a purpose preparatory to return to the community or for compassionate leave, the director may require the inmate to reimburse the state, in whole or part, for expenses incurred by the state in connection with the temporary removal or release.

C. The board of executive clemency, under specific rules established for the selection of inmates, if it appears to the board, in its sole discretion, that there is a substantial probability that the inmate will remain at liberty without violating the law and that the release is in the best interests of the state, may authorize the release of an inmate on work furlough if the inmate has served not less than six months of the sentence imposed by the court, is within twelve months of the inmate's parole eligibility date and has not been convicted of a sexual offense. The director shall provide information as the board requests concerning any inmate eligible for release on work furlough. The inmate shall not be released on work furlough unless the release is approved by the board.

D. An inmate who is otherwise eligible for work furlough pursuant to subsection C of this section, who is not on home arrest and who is currently serving a sentence for a conviction of a serious offense or conspiracy to commit or attempt to commit a serious offense shall not be granted work furlough except by one of the following votes:

A majority affirmative vote if four or more members of the board of executive clemency consider the action.
A unanimous affirmative vote if three members of the board of executive clemency consider the action.
A unanimous affirmative vote if two members of the board of executive clemency consider the action pursuant to section 31-401, subsection I and the chairman of the board concurs after reviewing the information considered by the two members.

E. Before holding a hearing on the work furlough under consideration, the board, on request, shall notify and afford an opportunity to be heard to the presiding judge of the superior court in the county in which the inmate requesting a work furlough was sentenced, the prosecuting attorney, the director of the arresting law enforcement agency and the victim of the offense for which the inmate is incarcerated. The notice shall state the name of the inmate requesting the work furlough, the offense for which the inmate was sentenced, the length of the sentence and the date of admission to the custody of the state department of corrections. The notice to the victim shall also inform the victim of the victim's right to be present and submit a written report to the board expressing the victim's opinion concerning the inmate's release. A hearing concerning work furlough shall not be held until fifteen days after the date of giving the notice. On mailing the notice, the board shall file a hard copy of the notice as evidence that notification was sent.

F. The board shall require that every inmate released on work furlough comply with the terms and conditions of release as the board may impose, including that the inmate be gainfully employed while on work furlough and that the inmate make restitution to the victim of the offense for which the inmate was incarcerated.

G. If the board finds that an inmate has failed to comply with the terms and conditions of release or that the best interests of this state would be served by revocation of an inmate's work furlough, the board may issue a warrant for retaking the inmate before the expiration of the inmate's maximum sentence. After return of the inmate, the board may revoke the inmate's work furlough after the inmate has been given an opportunity to be heard.

H. If the board denies the release of an inmate on work furlough or home arrest, the board may prescribe that the inmate not be recommended again for release on work furlough or home arrest for a period of up to one year.

I. The director shall transmit a monthly report containing the name, date of birth, offense for which the inmate was sentenced, length of the sentence and date of admission to the state department of corrections of each inmate on work furlough or home arrest to the chairperson of the house of representatives judiciary committee or its successor committee and the chairperson of the senate judiciary committee or its successor committee. The director shall also submit a report containing this information for any inmate released on work furlough or home arrest within a jurisdiction to the county attorney, sheriff and chief of police for the jurisdiction in which the inmate is released on work furlough or home arrest.

J. Any inmate who knowingly fails to return from furlough, home arrest, work furlough or temporary removal or temporary release granted under this section is guilty of a class 5 felony.

K. At any given time if the director declares there is a shortage of beds available for inmates within the state department of corrections, the parole eligibility as set forth in sections 31-411 and 41-1604.09 may be suspended for any inmate who has served not less than six months of the sentence imposed by the court, who has not been previously convicted of a felony and who has been sentenced for a class 4, 5 or 6 felony, not involving a sexual offense, the use or exhibition of a deadly weapon or dangerous instrument or the infliction of serious physical injury pursuant to section 13-704, and the inmate shall be continuously eligible for parole, home arrest or work furlough.

L. Prisoners who have served at least one calendar year and who are serving a sentence for conviction of a crime committed on or after October 1, 1978, under section 13-604, 13-1406, 13-1410, 13-3406, 36-1002.01, 36-1002.02 or 36-1002.03, and who are sentenced to the custody of the state department of corrections, may be temporarily released, according to the rules of the department, at the discretion of the director, one hundred eighty calendar days before expiration of the term imposed and shall remain under the control of the state department of corrections until expiration of the maximum sentence specified. If an offender released under this section or pursuant to section 31-411, subsection B violates the rules, the offender may be returned to custody and shall be classified to a parole class as provided by the rules of the department.

M. This section applies only to persons who commit felony offenses before January 1, 1994.

N. For the purposes of this section, "serious offense" means any of the following:

A serious offense as defined in section 13-706, subsection F, paragraph 1, subdivision (a), (b), (c), (d), (e), (g), (h), (i), (j) or (k).
A dangerous crime against children as defined in section 13-705. The citation of section 13-705 is not a necessary element for a serious offense designation.
A conviction under a prior criminal code for any offense that possesses reasonably equivalent offense elements as the offense elements that are listed under section 13-705, subsection T, paragraph 1 or section 13-706, subsection F, paragraph 1.

§ 41-1604.12 Community correctional centers; powers and duties; allocation of compensation; absence without leave; classification; notice; applicability

A. The director may:

Establish and operate facilities to be known as community correctional centers.
Transfer inmates whose terms of imprisonment have been fixed from the state prisons and facilities of the department to community correctional centers and place parolees in the centers.

B. The director shall make rules for the government of the community correctional centers in the management of their affairs. Sections 31-254 and 41-1624.01 do not apply to compensation received by inmates or parolees assigned to community correctional centers. The department is authorized to charge and collect one-third of any compensation received by an inmate or parolee living at the center for room and board. The department is further authorized to collect and forward to the court or other person authorized to receive court-ordered restitution an amount not to exceed one-third of the compensation received by an inmate or parolee assigned to the center. Other than for room and board or court-ordered restitution, compensation of the inmate or parolee received by the department while the inmate or parolee is assigned to the center shall be credited to the inmate's or parolee's account.

C. The purpose of community correctional centers is to provide housing, supervision, counseling and other correctional programs for persons committed to the department.

D. Absence without leave from a community correctional center or intentional failure of an inmate to return from a furlough, work furlough or temporary leave granted under the provision of this section is a class 5 felony.

E. Before incurring any obligation for the establishment or any change of use of a community correctional center, the department shall give notice pursuant to section 41-1604.19. The county, city or town and school district may contest establishment of a community correctional center by written objection filed with the department within thirty days after receiving notice, and may request a hearing to be conducted by the department pursuant to chapter 6, article 6 of this title.

F. This section applies only to persons who commit felony offenses before January 1, 1994.

§ 41-1604.13 Home arrest; eligibility; victim notification; conditions; applicability; definitions

A. An inmate who has served not less than six months of the sentence imposed by the court is eligible for the home arrest program if the inmate:

Meets the following criteria:

(a) Was convicted of committing a class 4, 5 or 6 felony not involving a dangerous offense.

(b) Was not convicted of a sexual offense.

Violated parole by the commission of a technical violation that was not chargeable or indictable as a criminal offense.
Is eligible for work furlough.
Is eligible for parole pursuant to section 31-412, subsection A.

B. The board of executive clemency shall determine which inmates are released to the home arrest program based on the criteria in subsection A of this section and based on a determination that there is a substantial probability that the inmate will remain at liberty without violating the law and that the release is in the best interests of the state after considering the offense for which the inmate is presently incarcerated, the prior record of the inmate, the conduct of the inmate while incarcerated and any other information concerning the inmate that is in the possession of the state department of corrections, including any presentence report. The board maintains the responsibility of revocation as applicable to all parolees.

C. An inmate who is otherwise eligible for home arrest, who is not on work furlough and who is currently serving a sentence for a conviction of a serious offense or conspiracy to commit or attempt to commit a serious offense shall not be granted home arrest except by one of the following votes:

A majority affirmative vote if four or more members of the board of executive clemency consider the action.
A unanimous affirmative vote if three members of the board of executive clemency consider the action.
A unanimous affirmative vote if two members of the board of executive clemency consider the action pursuant to section 31-401, subsection I and the chairman of the board concurs after reviewing the information considered by the two members.

D. Home arrest is conditioned on the following:

Active electronic monitoring surveillance for a minimum term of one year or until eligible for general parole.
Participation in gainful employment or other beneficial activities.
Submission to alcohol and drug tests as mandated.
Payment of the electronic monitoring fee in an amount determined by the board of not less than $1 per day and not more than the total cost of the electronic monitoring unless, after determining the inability of the inmate to pay the fee, the board requires payment of a lesser amount. The fees collected shall be returned to the department's home arrest program to offset operational costs of the program.
Remaining at the inmate's place of residence at all times except for movement out of the residence according to mandated conditions.
Adherence to any other conditions imposed by the court, board of executive clemency or supervising corrections officers.
Compliance with all other conditions of supervision.
Payment of a monthly home arrest supervision fee of at least $65 unless, after determining the inability of the inmate to pay the fee, the department requires payment of a lesser amount. The supervising corrections officer shall monitor the collection of the fee. Monies collected shall be deposited, pursuant to sections 35-146 and 35-147, in the community corrections enhancement fund established by section 31-418.
Payment of a drug testing fee in an amount to be determined by the board and not to exceed the costs of the drug testing program. The fees collected pursuant to this paragraph by the department may only be used to offset the costs of the drug testing program.

E. Before holding a hearing on home arrest, the board on request shall notify and afford an opportunity to be heard to the presiding judge of the superior court in the county in which the inmate requesting home arrest was sentenced, the prosecuting attorney and the director of the arresting law enforcement agency. The board shall notify the victim of the offense for which the inmate is incarcerated. The notice shall state the name of the inmate requesting home arrest, the offense for which the inmate was sentenced, the length of the sentence and the date of admission to the custody of the state department of corrections. The notice to the victim shall also inform the victim of the victim's right to be present and to submit a written report to the board expressing the victim's opinion concerning the inmate's release. A hearing concerning home arrest may not be held until fifteen days after the date of giving the notice. On mailing the notice, the board shall file a hard copy of the notice as evidence that notification was sent.

F. An inmate who is placed on home arrest is on inmate status, is subject to all the limitations of rights and movement and is entitled only to due process rights of return.

G. If an inmate violates a condition of home arrest that poses any threat or danger to the community, or commits an additional felony offense, the board shall revoke the home arrest and return the inmate to the custody of the state department of corrections to complete the term of imprisonment as authorized by law.

H. The ratio of supervising corrections officers to supervisees in the home arrest program shall not be greater than one officer for every twenty-five supervisees.

I. The board shall determine when the supervisee is eligible for transfer to the regular parole program pursuant to section 31-411.

J. This section applies only to persons who commit felony offenses before January 1, 1994.

K. For the purposes of this section:

"Dangerous offense" has the same meaning prescribed in section 13-105.
"Serious offense" includes any of the following:

(a) A serious offense as defined in section 13-706, subsection F, paragraph 1, subdivision (a), (b), (c), (d), (e), (g), (h), (i), (j) or (k).

(b) A dangerous crime against children as defined in section 13-705. The citation of section 13-705 is not a necessary element for a serious offense designation.

(c) A conviction under a prior criminal code for any offense that possesses reasonably equivalent offense elements as the offense elements that are listed under section 13-705, subsection T, paragraph 1 or section 13-706, subsection F, paragraph 1.

§ 41-1604.14 Drug and alcohol treatment programs; annual report

A. On or before December 1 each year, the director shall report on the drug and alcohol treatment programs available to offenders in this state who are under the jurisdiction of the department. The report shall include:

A description of each program, including whether the program is for offenders who are imprisoned or for offenders who are on community supervision or parole.
The number of offenders who are currently receiving services from a program and the total number of offenders who received services over the previous twelve months.
The cost per offender for each program and the source of the monies that are used.
The name of each drug and alcohol treatment program provider.
A comparison of the drug and alcohol treatment programs that are offered to:

(a) Offenders who are in a department facility.

(b) Offenders who are in a private prison that contracts with the department.

B. The report shall be submitted to the governor, the president of the senate and the speaker of the house of representatives and a copy of this report shall be provided to the secretary of state.

§ 41-1604.15 Probation or other release noneligibility; violent crime; under the influence of marijuana, a dangerous drug or a narcotic drug

Notwithstanding any law to the contrary, any person who is convicted of a violent crime as defined in section 13-901.03 that is committed while the person is under the influence of marijuana, a dangerous drug or a narcotic drug as defined in section 13-3401 is not eligible for probation or release on any basis until the entire sentence has been served. Pursuant to section 41-1604.07, the director shall include any such person in a noneligible earned release credit class and the prisoner is not eligible for placement in an eligible earned release credit class.

§ 41-1604.16 Parole or community supervision eligibility for persons previously convicted of possession or use of marijuana, a dangerous drug or a narcotic drug

A. Notwithstanding any law to the contrary, if a prisoner has been convicted of the possession or use of marijuana pursuant to section 13-3405, subsection A, paragraph 1, possession or use of a dangerous drug pursuant to section 13-3407, subsection A, paragraph 1 or possession or use of a narcotic drug pursuant to section 13-3408, subsection A, paragraph 1 and the prisoner is not concurrently serving another sentence, the prisoner is eligible for parole or if the offense for which the prisoner was incarcerated was committed on or after January 1, 1994, the prisoner is eligible for community supervision.

B. Any person who has previously been convicted of a violent crime as defined in section 13-901.03 or who has previously been convicted and sentenced in any jurisdiction in the United States of any felony offense is not eligible for parole or community supervision pursuant to this section. If the department is unable to determine if a person has a prior felony conviction, the department shall refer the inmate record to the sentencing court. The sentencing court shall determine if the person has a prior felony conviction. For the purposes of this subsection, the age of the conviction does not matter.

C. On or before June 3, 1997, the director of the state department of corrections shall prepare a list that identifies each person who is eligible for parole or community supervision pursuant to this section and shall deliver the list to the board of executive clemency.

D. An offense that is committed in another jurisdiction and that is not classified as a felony in Arizona is not a felony offense for purposes of this section.

§ 41-1604.17 Arizona parents commission on drug education and prevention

A. The Arizona parents commission on drug education and prevention is established. The commission shall consist of nine members. The members of the commission shall be appointed by the governor within sixty days of the effective date of this section and shall serve two year terms. Of the nine members, five shall be parents with children currently enrolled in a school in this state, one shall be a representative of a law enforcement agency, one shall be an educator in a local school district, one shall be a representative of a county probation department, and one shall be a representative of the drug education and treatment community.

B. The members shall receive no pay but may be reimbursed for actual expenses incurred on commission business.

C. The commission shall fund programs that will increase and enhance parental involvement and will increase education about the serious risks and public health problems caused by the abuse of alcohol and controlled substances.

D. The commission shall contract for administrative and professional services with a not for profit organization or government entity with expertise in substance abuse education and prevention.

§ 41-1604.18 Community reentry work program; eligibility; victim notification; compensation; violation; classification

A. The director may authorize an eligible inmate who is within ninety days of the inmate's earliest release date to participate in a community reentry work program. The director shall adopt rules to implement the community reentry work program, including eligibility criteria for the selection of inmates. To be eligible, at a minimum, the inmate must:

Not have been convicted at any time of any of the following:

(a) A violation of title 13, chapter 13, 14 or 17.

(b) A violent crime as defined in section 13-901.03.

Not currently be serving a sentence for a domestic violence offense pursuant to section 13-3601.
Be classified by the department as a low risk to the community.
Not have any felony detainers or United States immigration and customs enforcement detainers.
Not have previously escaped or attempted to escape from a secure or nonsecure jail or prison facility or environment.
Have made satisfactory progress on the inmate's individualized corrections plan as determined by the department.
Have maintained civil behavior while incarcerated as determined by the department.
Be current on any restitution payments ordered by a court pursuant to section 13-603.
Have a need and ability to benefit from a community reentry work program as determined by the department.

B. The department must notify and afford an opportunity to be heard to the victim of the offense for which the inmate is incarcerated if the victim has provided a current address or other contact information. The notice must include the name of the inmate, the offense for which the inmate was sentenced, the length of the sentence and the date of admission to the custody of the department. The notice must inform the victim of the victim's right to submit a written statement to the director expressing the victim's opinion on the inmate's participation in the community reentry work program within twenty days after the department has mailed the notice to the victim.

C. An inmate who participates in the community reentry work program must:

Comply with all community reentry work program rules and any other terms and conditions that the director requires.
Maintain gainful employment.
Continue to make any court-ordered restitution payments.
Agree to provide all compensation that the inmate receives while participating in the program to the department for deposit in the inmate's account.

D. The director may remove an inmate from the community reentry work program if the director determines that the inmate has failed to comply with any program rule, term or condition or that the best interests of the state would be served by removing the inmate from the community reentry work program.

E. Sections 31-254 and 41-1624.01 do not apply to the compensation that an inmate earns while in the community reentry work program. The department is authorized to charge and collect a percentage of the inmate's compensation, as determined by the director, for the cost of the inmate's room and board. The director may deduct monies from the inmate's account to pay restitution, costs and fines that are owed by the inmate.

F. An inmate who is absent without leave from a facility in the community reentry work program is guilty of a class 5 felony. The sentence for a violation of this section shall be served consecutively pursuant to section 13-711, subsection B.

§ 41-1604.19 Correctional facilities; notice; exception; definitions

A. Before incurring any obligation for the establishment of any correctional facility or any change of use of a correctional facility, the department shall give at least forty-five days' written notice to all of the following:

Each real property owner, as shown on the last assessment of the property, within a two-mile radius of the proposed site or of the site for which the change of use is proposed. The two-mile radius excludes any natural or man-made feature that prevents parcels of land from being practically and reasonably united.
The president of the senate.
The speaker of the house of representatives.
The senate minority leader and the house of representatives minority leader.
The state senator and the state representatives whose legislative district includes the proposed site or the site for which the change of use is proposed.
Each state senator and state representative whose legislative district is located within five miles of the proposed site or of the site for which the change of use is proposed.
Each member of the county board of supervisors if the proposed site or the site for which the change of use is proposed is in an unincorporated area or each member of the governing body of the city or town in which the proposed site or the site for which the change of use is proposed is located.
Each member of the governing board of the local school district in which the proposed site or the site for which the change of use is proposed is located.
The superintendent of the local school district in which the proposed site or the site for which the change of use is proposed is located.
Each member of the governing board of any charter school that is located within a five-mile radius of the proposed site or the site for which the change of use is proposed.
The operator of any child care facility that is located within a five-mile radius of the proposed site or the site for which the change of use is proposed.

B. On request of the state department of corrections, the department of education shall provide an accurate list of district schools and charter schools within the boundaries prescribed in subsection A, paragraphs 9 and 10 of this section.

C. On request of the state department of corrections, the department of health services shall provide an accurate list of child care facilities within the boundaries prescribed in subsection A, paragraph 11 of this section.

D. The notice required pursuant to subsection A of this section must include all of the following:

The number of prisoners or parolees to be housed at the correctional facility.
The security level of the prisoners to be housed at the correctional facility.
The date, time and location of the public hearing that is required by subsection F of this section.
The overall time frame during which the department will either approve or reject the establishment of any correctional facility or change of use of a correctional facility.
A statement that a report of the oral comments received at the hearing and the written comments received by the department will be available on the department's website.

E. The department shall post a sign that is at least four feet by eight feet in a conspicuous location on the proposed site or on the site for which the change of use is proposed for fifteen calendar days before the hearing that is required pursuant to subsection F of this section. The sign shall give notice of the date, time and location of the hearing.

F. The department shall hold a hearing in the county for an unincorporated area or in the city or town in which the potential site or the site for which the change of use for a correctional facility is proposed is located. The department shall publish a notice of the public hearing in a newspaper of general circulation in the area at least ten days before the hearing. The department shall receive oral comments at the hearing and written comments before the hearing. The department shall compile all of the written comments into a report and shall post the report with the minutes of the hearing on the department's website within five calendar days after the hearing. The department shall submit the report electronically to all of the entities listed in subsection A, paragraphs 2, 3, 4 and 5 of this section. At least fifteen days after the hearing and after the department has considered the public comments, the department shall make a final site determination for the correctional facility or a final determination on the change of use for the correctional facility.

G. This section does not apply to the reclassification of custody levels or designated use of an existing correctional facility or the housing assignments of inmates or offenders within a correctional facility.

H. For the purposes of this section:

"Change of use" means the introduction of any of the following:

(a) Adult offenders or inmates into a department of juvenile corrections facility.

(b) A new classification of offenders into a community correctional facility that had not previously provided services to that classification of offenders.

"Correctional facility" means:

(a) An adult correctional facility.

(b) A juvenile correctional facility.

(d) A private prison.

(e) Any facility dedicated to the confinement of persons committed to the department or the department of juvenile corrections.

(f) A juvenile secure care facility as described in section 41-2816.

"Establishment" means the construction of a correctional facility or the introduction of inmates or offenders from another location into a newly established correctional facility where inmates or offenders were not previously located or housed.

§ 41-1604.20 Graduated intervention policy; guidelines; annual report

A. The director shall develop, implement and maintain a graduated intervention policy for offenders who violate a condition of community supervision. The policy must include guidelines for using graduated interventions on an offender who commits a technical violation of a condition of community supervision.

B. The department shall prepare and submit an annual report to the governor, the speaker of the house of representatives and the president of the senate that details the use of and completion rates for major graduated interventions in the previous year. The department shall provide a copy of this report to the secretary of state.

§ 41-1605 Power to accept and expend gifts

A. The state department of corrections may accept and expend federal funds or private grants of funds, gifts and legacies and may accept, manage or dispose of property, to effectuate the purposes of this article. The director of the state department of corrections shall have oversight over the acceptance of funds and property. The funds shall be deposited, pursuant to sections 35-146 and 35-147, in a special fund designated as the department of corrections fund and shall be expended upon warrants drawn by the department of administration upon order of the director. Any unexpended funds shall not revert to the state general fund at the close of the fiscal year.

B. Accounts for individual correctional institutions shall not be established within the department of corrections fund.

§ 41-1606 Access to prisoner medical history information

A. Notwithstanding any law to the contrary, in order to facilitate prison and inmate management the director, assistant directors, wardens and deputy wardens of the state department of corrections on request shall have access to any prisoner medical history information that is maintained by the department and that has an impact on the administration of the prison system or on the welfare of the inmate population.

B. The director, assistant directors, wardens and deputy wardens shall keep confidential the prisoner medical history information that they receive pursuant to subsection A, except that the director, assistant directors, wardens and deputy wardens may use the medical history information to establish for department employees precautionary procedures and guidelines for the care, transportation and housing of inmates whose medical histories indicate a need for special management.

§ 41-1607 Correctional facilities for minors; programs

A. The director may establish and operate correctional facilities for persons who are under eighteen years of age and who are committed to the state department of corrections. The juvenile inmates shall be kept in a separate section from adult inmates.

B. The director shall require juveniles who are committed to the department to participate in the following intensive programs:

The functional literacy program established pursuant to section 31-229.
An organized recreation and physical training program.
A citizenship training program.
A labor program pursuant to section 31-251.

§ 41-1608 Inmate medical services; rate structure

If a prisoner in a secure care facility requires health care services that the department, the facility or a private prison provider contracted by the department cannot provide, the department shall pay approved claims from a facility or provider that provides these services as follows:

Except as provided in paragraph 3 of this section, for inpatient and outpatient hospital services, the department shall reimburse at a level that does not exceed the reimbursement methodology established pursuant to section 36-2903.01, subsection G.
For health and medical services, the department shall reimburse at a level that does not exceed the capped fee-for-service schedule that is adopted by the Arizona health care cost containment system administration pursuant to title 36, chapter 29, article 1 and that is in effect at the time the services are delivered.
For inpatient and outpatient hospital services that are provided in a fully locked unit setting, the department may establish an alternative reimbursement rate that does not exceed one hundred twenty percent of the current medicare rate. For the purposes of this paragraph, "fully locked unit setting":

(a) Means a ward or wing in which treatment and services are provided and that is secured in a manner that prevents patients from leaving the ward or wing at will.

(b) Does not include a ward or wing that is locked only for the purpose of preventing unauthorized entry and that allows a patient to exit the ward or wing at will.

§ 41-1609 Agreements with federal or private agencies and institutions; contract review; emergency contracts

A. The department may enter into agreements with the federal government, other states or agencies of the federal government or other states for such compensation upon which they agree to accept or deliver adult offenders or to administer correctional programs. Notwithstanding the provisions of section 35-193, any funds received by the department under the agreements shall be kept in a separate revolving fund for current usage and shall not revert to the state general fund if unexpended at the close of a fiscal year.

B. The department may contract with any private or public institution that is located inside or outside this state for facilities or the operation of facilities that are dedicated to the confinement of persons who are committed to the department. Notwithstanding chapter 4, article 7 of this title and article 4 of this chapter, the contract may include a purchase option and if the contract has a per diem provision the contract may include a provision that allows a portion of the per diem to be applied to reduce the purchase price.

C. The department shall submit all contracts entered into pursuant to subsection B of this section to the attorney general to determine if the contract is within the authority granted under the laws of this state and in proper form. All contracts involving the detention or incarceration of adult offenders shall conform to the requirements of section 41-1609.01.

D. Notwithstanding subsection C of this section, the department may enter into emergency contracts pursuant to section 41-2537 with private or public institutions for facilities or the operation of facilities that are dedicated to the confinement of persons who are committed to the department.

E. The director may declare an emergency for acts of God, natural catastrophes, prison riots and overcrowding. In an emergency, the director shall:

Confine persons who are committed to the department in either of the following:

(a) An existing public institution.

(b) A private institution that is described in subsection B of this section.

Up to twenty-four hours before declaring the emergency, notify the governor and the attorney general of the emergency and the need to relocate persons who are committed to the department to another existing public or private facility established pursuant to sections 41-1609.01 and 41-1609.02.
Within thirty days after declaring the emergency, determine the length of the emergency confinement. If the director determines that the emergency confinement will exceed six months in duration, the emergency contract shall comply with sections 41-1609.01 and 41-1609.02.

F. Notwithstanding subsection E, paragraph 2 of this section, if the director declares that an emergency exists due to the overcrowding of a public or private correctional facility, the director shall discuss with the governor, the attorney general and the majority and minority leadership in the senate and the house of representatives relocating the inmates from the overcrowded facility to another facility before relocating the inmates.

G. An emergency contract shall not exceed one year in duration.

§ 41-1609.01 Adult incarceration contracts; criteria

A. On publication, any request for proposals shall be provided to the joint legislative budget committee for its review.

B. To be considered for an award of a contract, the proposer must demonstrate that it has:

The qualifications, operations and management experience and experienced personnel necessary to carry out the terms of the contract.
The ability to comply with applicable correctional standards and any specific court order, if required.
A demonstrated history of successful operation and management of other secure facilities.

C. The proposer of a contract for correctional services must agree that this state may cancel the contract at any time after the first year of operation, without penalty to this state, on giving ninety days' written notice.

D. A contract may provide for annual contract price or cost adjustments, except that any adjustments may be made only once each year effective on the anniversary of the effective date of the contract. If any adjustment is made pursuant to the terms of the contract, it shall be applied to the total payments made to the contractor for the previous contract year and shall not exceed the per cent of change in the average consumer price index as published by the United States department of labor, bureau of labor statistics between that figure for the latest calendar year and the next previous calendar year.

E. Any price or cost adjustments to a contract different than those authorized in subsection D of this section may be made only if the legislature specifically authorizes the adjustments and appropriates monies for that purpose, if required.

F. An award of a contract shall not be made unless an acceptable proposal is received pursuant to any request for proposals. For the purposes of this subsection, "acceptable proposal" means a proposal that substantially meets all of the requirements or conditions set forth in this section and that meets all of the requirements in the request for proposals.

G. A proposal shall not be accepted unless the proposal offers cost savings to this state.

H. A proposal shall not be accepted unless the proposal offers a level and quality of services that are at least functionally equal to those that would be provided by this state.

I. Notwithstanding section 41-2546, a contract to provide correctional services as described in this section may be for an initial period of not more than ten years.

J. The initial contract may include an option to renew for two subsequent renewal periods of not more than five years each.

K. A contract for correctional services described in this section shall not be entered into unless the following requirements are met:

The contractor provides audited financial statements for the previous five years, or for each of the years the contractor has been in operation, if fewer than five years, and provides other financial information as requested.
The contractor provides an adequate plan of insurance, specifically including coverage or insurance for civil rights claims and liabilities as approved by the risk management division of the department of administration.
The contractor agrees to be liable for the costs of any emergency, public safety or security services provided to the contractor by the state or any political subdivision of the state and to reimburse the state or any political subdivision of the state for the cost of any such services.

L. The sovereign immunity of this state does not apply to the contractor. Neither the contractor nor the insurer of the contractor may plead the defense of sovereign immunity in any action arising out of the performance of the contract.

M. A contract for correctional services shall not authorize, allow or imply a delegation of authority or responsibility to a prison contractor for any of the following:

Developing and implementing procedures for calculating inmate release dates.
Developing and implementing procedures for calculating and awarding sentence credits.
Approving the type of work inmates may perform and the wages or sentence credits that may be given to inmates engaging in the work.
Granting, denying or revoking sentence credits, placing an inmate under less restrictive custody or more restrictive custody or taking any disciplinary actions.

§ 41-1609.02 Establishment of private prison facilities; notice

A. Before expanding an existing minimum or medium security level prison or before establishing a new minimum or medium security level prison, the director shall give consideration to contracting for private prisons for the incarceration of:

Prisoners convicted of offenses pursuant to title 28, chapter 4, article 3.
Prisoners convicted of offenses pursuant to title 13, chapter 14.
Female prisoners.
Prisoners over the age of fifty-five years.
Other inmate populations identified by the director.

B. Before entering into a contract with a private prison facility contractor for the incarceration of prisoners listed in subsection A of this section, the director shall determine that the contractor will provide at least the same quality of services as this state at a lower cost or that the contractor will provide services superior in quality to those provided by this state at essentially the same cost. In making this determination, the director shall consider the following:

Security.
Inmate management and control.
Inmate programs and services.
Facility safety and sanitation.
Administration.
Food service.
Personnel practices and training.
Inmate health services.
Inmate discipline.

C. The director shall identify from subsection A of this section, the appropriate inmate population for placement in privatized beds and the corresponding number of inmates. The director shall report the information to the governor, the legislature and the joint select committee on corrections by October 15 of every year for consideration in determining expansion of prison capacity.

D. The director may establish other private incarceration facilities that are dedicated to the confinement of persons who are sentenced to the department.

E. Before incurring any obligation for the establishment or any change of use of any private incarceration facility, the department shall give notice pursuant to section 41-1604.19.

§ 41-1609.03 Adult incarceration private contractors; liability for services

A private contractor that contracts with any governmental entity to provide detention or incarceration services for offenders shall be liable for the cost of any emergency, public safety or security services provided to the contractor by the state or any political subdivision of the state and shall reimburse the state or any political subdivision of the state for the cost of any such services.

§ 41-1609.04 Reimbursing county for expense of prosecution; private prison

A. If a person is arrested within this state for any crime described in subsection C of this section, the clerk of the court in which the legal proceedings relating to the crime are held shall prepare an itemized claim against the private prison for the court costs and any other costs or fees incurred by the county upon the prosecution and defense of the case and the cost of confining and keeping the prisoner. The claim shall be certified by the presiding judge of the superior court in that county and sent to the private prison for payment.

B. Upon receipt of the certified claim, the private prison shall pay the county treasurer of the county where the legal proceedings were held. The county treasurer shall deposit the monies in the county general fund.

C. This section applies to any crime committed:

In or adjacent and related to a private prison that is under contract with the department pursuant to section 41-1609.
By a person while escaped from a private prison that is under contract with the department pursuant to section 41-1609 or with any political subdivision of the state.
By a person who escaped from the custody of officials or employees of a private prison that is under contract with the department pursuant to section 41-1609.

§ 41-1610 Hazardous duty designation

(L90, ch 344, sec 2.)

All personnel employed by the department of corrections who meet the following criteria shall be considered to be engaged in hazardous duty:

Those whose duties involve the supervision, guarding or custody of inmates, pursuit and recapture of escapees or supervision of parolees.
Those whose duties, which although not custodial in nature, require frequent contact with convicted felons or dangerous youth offenders.

§ 41-1610.01 Authorization to maintain and retake custody of New Mexico prisoners

An officer or employee of the New Mexico department of corrections who has in his custody, pursuant to New Mexico law, a ward, offender or prisoner of the state of New Mexico whom he is transporting from a facility in New Mexico to another point in New Mexico via Arizona or to a point in Arizona for a necessary work detail of fire fighting or conservation work shall maintain custody of such ward, offender or prisoner in Arizona. Such officer or employee may, in the event of the escape of such ward, offender or prisoner in Arizona, retake such ward, offender or prisoner in the same manner as if such officer or employee were an Arizona peace officer and such ward, offender or prisoner had been committed to his custody under Arizona law.

§ 41-1610.03 Inmates; workforce and reentry; documentation; rules

A. The state department of corrections shall provide an inmate who is discharged from imprisonment for a felony offense and who intends to reside in this state with relevant documentation to assist the inmate in obtaining postrelease employment and shall coordinate with the department of transportation to replace the inmate's current nonoperating identification license or driver license, if applicable, or to provide the inmate with a nonoperating identification license if the inmate does not possess a current nonoperating identification license or driver license.

B. Nine months before an inmate's release from custody, the state department of corrections, in coordination with the department of transportation, shall determine whether the inmate possesses a current and valid nonoperating identification license or driver license. If the inmate does not possess a current and valid nonoperating identification license or driver license, the state department of corrections shall begin gathering the documentation that is required for obtaining a nonoperating identification license.

C. The state department of corrections, in coordination with the department of transportation, shall provide a nonoperating identification license to each eligible inmate, on release from custody, who does not possess a current and valid nonoperating identification license or driver license. A nonoperating identification license or driver license that is issued to an inmate pursuant to this section shall be issued, replaced, canceled and denied in the same manner as a nonoperating identification license or a driver license pursuant to title 28, chapter 8, article 4.

D. The department of transportation shall allow copies of birth certificates along with a state department of corrections issued record card to serve as a valid form of photo identification to obtain a nonoperating identification license or driver license pursuant to subsection C of this section.

E. The state department of corrections shall provide any inmate who has served in the United States military with the contact information of the department of veterans' services along with the department of veterans' services veteran benefits guide.

F. The state department of corrections may use any monies available to cover the costs associated with implementing and administering this section and to pay fees associated with issuing a nonoperating identification license or driver license, including inmate trust fund monies, existing department fund monies and donations.

G. To assist an inmate in obtaining postrelease employment, the state department of corrections shall provide the inmate with the following documentation:

A copy of the inmate's vocational training record, if applicable.
A copy of the inmate's work record, if applicable.
A certified copy of the inmate's birth certificate, if obtainable.
A social security card or a replacement social security card, if obtainable.
A resume that includes any trade learned by the inmate and the inmate's proficiency at that trade.
Documentation that the inmate has completed a mock job interview.

H. The state department of corrections shall notify an inmate if the inmate is eligible to apply for a license or certificate from a state agency that oversees occupational licenses or certifications.

I. Subsection G, paragraphs 5 and 6 do not apply to inmates who are any of the following:

Sixty-five years of age or older.
Being released for medical reasons or who are being discharged from a prison infirmary.
Being released to the custody of another jurisdiction on a warrant or detainer.
Determined by the state department of corrections to be physically or mentally unable to return to the workforce on release from incarceration.

J. The state department of corrections, the department of health services and the department of transportation may adopt rules to implement this section.

Article 2 Divisions of the Department

§ 41-1611 Number of divisions or units

The department shall consist of such number of divisions or units as may be established by the director. Each such division or unit shall be under the supervision of a person appointed by the director.

§ 41-1612 Community treatment program for imprisoned women; rules; eligibility; requirements

A. The department shall establish a community treatment program for imprisoned women and their children. Subject to the availability of monies, the department shall contract with an experienced nonprofit entity to establish and operate a community treatment center and may transfer a woman who has recently given birth to the community treatment center to live with her child or children. The community treatment program for imprisoned women shall provide trauma-informed substance abuse treatment, mental health treatment and a secure environment for the woman and her child or children.

B. The department shall adopt rules for the community treatment program for imprisoned women, including the eligibility requirements for entering the program and living in the community treatment center. The department shall take into account public safety and generally accepted correctional practices when developing and implementing rules regarding the community treatment program.

C. The community treatment program shall provide programs and support services to assist mothers and their children in developing the skills necessary to become functioning, self-sufficient families, including:

Substance abuse treatment.
Well-being and emotional supports.
Parenting skills.
Educational and employment skills.
Financial literacy.
Workforce skills training.

D. The nonprofit entity contracted pursuant to subsection A of this section shall provide pediatric care consistent with medical standards and, to the extent feasible, shall be guided by the need to provide the following:

A stable, caregiving, stimulating environment for the children as developed and supervised by professional guidance in the area of child development.
Programs that are geared to ensure the stability of the parent-child relationship during and after participating in the program and that are developed and supervised by appropriate professional guidance. At a minimum, these programs shall be geared to accomplish the following:

(a) The mother's management of identified substance abuse.

(b) The mother's familiarity with good parenting skills.

(d) Securing adequate housing arrangements after participating in the program.

(e) Securing adequate child care arrangements after participating in the program.

(f) Engaging in productive employment after participating in the program.

The least restrictive alternative to incarceration and restraint possible to achieve the objectives of correction and of this section consistent with public safety and justice.

E. In the first year after the department establishes the community treatment program, subject to the availability of monies, the department shall place up to twenty women in the program. In the second year and each year thereafter, subject to the availability of monies, the department shall place up to fifty women in the program.

F. To be eligible for the program, an inmate must be a woman who gives birth to a child while imprisoned and who is scheduled to be released from imprisonment in five years or less.

G. A child who resides at the community treatment center is not subject to the same security restrictions as the prisoner except as necessary to ensure the child's safety, the security of the facility and compliance with program rules.

§ 41-1613 Community correctional centers; powers and duties; allocation of compensation; absence without leave; classification; notice

A. The director may:

Establish and operate facilities to be known as community correctional centers.
Transfer inmates whose terms of imprisonment have been fixed from the state prisons and facilities of the department to community correctional centers and place inmates placed on community supervision in such centers.

B. The director shall make rules for the government of the community correctional centers in the management of their affairs. Sections 31-254 and 41-1624.01 do not apply to compensation received by inmates or inmates placed on community supervision assigned to community correctional centers. The department is authorized to charge and collect one-third of any compensation received by an inmate or an inmate placed on community supervision living at the center for room and board. The department is further authorized to collect and forward to the court or other person authorized to receive court ordered restitution an amount not to exceed one-third of the compensation received by an inmate or an inmate placed on community supervision assigned to the center. Other than for room and board or court ordered restitution, compensation of the inmate or an inmate placed on community supervision received by the department while the inmate or an inmate placed on community supervision is assigned to the center shall be credited to the inmate's or an inmate placed on community supervision's account.

C. The purpose of community correctional centers is to provide housing, supervision, counseling and other correctional programs for persons committed to the department.

D. Absence without leave from a community correctional center or intentional failure of an inmate to return from a temporary leave granted under the provisions of this section is a class 5 felony.

E. Before incurring any obligation for the establishment or any change of use of a community correctional center, the department shall give notice pursuant to section 41-1604.19. The county, city, town and school district may contest establishment of a community correctional center by written objection filed with the department within thirty days after receiving notice and may request a hearing pursuant to chapter 6, article 6 of this title.

Article 3 Arizona Correctional Industries

§ 41-1621 Definitions

In this article, unless the context otherwise requires:

"Arizona correctional industries" means the Arizona correctional industries program.
"Department" means the state department of corrections.
Director" means the director of the state department of corrections.

§ 41-1622 Arizona correctional industries; establishment; purpose

A. Arizona correctional industries may purchase raw materials, components and supplies for use in the manufacture of products for sale or provide services. In support of its retail operation, Arizona correctional industries may purchase or consign items for sale to the public that are produced by other state correctional industries or by inmates who are incarcerated in facilities that are located in this state but that are outside the custodial responsibility of the state department of corrections.

B. Arizona correctional industries shall pay all obligations in accordance with section 41-1624 at any location under the control of Arizona correctional industries. The industries or enterprises shall be conducted for the employment of prisoners for the purposes of manufacturing or producing such articles or products or providing services as may be needed for the construction, operation, maintenance or use of any office, department, institution or agency supported in whole or in part by a state or its political subdivisions or for sale to the public.

§ 41-1623 Powers and duties of director

A. Subject to legislative appropriation, the director shall establish, regulate, operate and terminate, if appropriate, Arizona correctional industries pursuant to this article.

B. The department may enter into contracts and agreements with any person or persons for the acquisition and purchase of raw materials required for manufacture of Arizona correctional industries products.

C. The director or his designee shall, when necessary, conduct market research, establish marketing procedures and develop product specifications for sale of Arizona correctional industries products to public agencies, the public and private industry.

D. The director or his designee, consistent with sound business judgment, may construct, reconstruct or lease one or more buildings or portions of buildings on the grounds of any state correctional institution or location under department control, together with the real estate needed for reasonable access to such buildings, any lease to have a term of not to exceed twenty years, to a private corporation for the purpose of establishing and operating a factory for the manufacture and processing of products or any other commercial enterprise deemed by the director to provide employment opportunities for inmates in meaningful jobs for wages. Each lease negotiated and concluded pursuant to this section shall include and shall be valid only as long as the lessee adheres to the following provisions:

All persons employed in the factory or other commercial enterprise operated in or on the leased property, except the lessee's supervisory employees and necessary training personnel, shall be inmates of the institution where the leased property is located who are approved for such employment by the director or his designee.
The factory or other commercial enterprise operated in or on the leased property shall observe at all times such practices and procedures regarding security as the lease may specify or as the director may temporarily stipulate during periods of emergency.
The factory or other commercial enterprise operated on the leased property shall be deemed a private enterprise and subject to all the laws and lawfully adopted rules of this state governing the operation of similar business enterprises elsewhere.

E. The director or his designees may dispose of property that is no longer needed or necessary for use by Arizona correctional industries. The disposition of property is exempt from chapter 23, article 8 of this title. Any monies derived from the disposition of property shall be deposited in the Arizona correctional industries revolving fund.

F. The director may employ persons necessary to carry out the provisions of this article.

G. The director shall adopt rules for the administration and management of personnel policies for prisoner workers including wages, working hours and conditions of employment.

H. The Arizona correctional industries program shall operate on the state fiscal year pursuant to section 35-102, and the director shall designate a certified public accountant to conduct an annual audit of its financial records.

I. The director shall prepare an annual report and distribute it to every member of the legislature which, in addition to making an annual financial report in accordance with section 35-103, reports on the management of the program, its goals and objectives and the record of management in achieving those objectives.

J. The director may accept and expend private grants of monies to effectuate the purposes of this article. Such monies shall be deposited and administered in accordance with section 41-1624.

§ 41-1624 Arizona correctional industries revolving fund; definitions

A. The director may establish a revolving fund to be used to pay the expenses required:

For the purchase of raw materials, components and supplies to be used for the production of food and other items to be sold by the department's Arizona correctional industries.
For the compensation of prisoners and Arizona correctional industries professional and outside services.
For the purchase or rental of equipment to be used by the department's Arizona correctional industries.
For the construction or reconstruction of facilities.
For other operating expenses and in-state travel.
For the purchase of workers' compensation insurance for inmates who are employed in a federally certified prison industry enhancement program pursuant to section 41-1674.
For prisoner instruction related to vocational education, job training, parenting and alcohol and other drug use treatment classes.

B. Monies received for or derived from the operation of Arizona correctional industries, including monies from the sale of obsolete or unneeded material, supplies, equipment or property, shall be deposited, pursuant to sections 35-146 and 35-147, in a specially designated revolving fund and expended without need of previous encumbrance upon warrants drawn upon order of the director or the director's designee. The fund is a continuing fund and is exempt from the provisions of section 35-190. The director shall transfer one million dollars from the revolving fund annually to the department of corrections building renewal fund established by section 41-797.

C. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

D. For the purposes of this section:

"Components" means the parts, subassemblies and packaging materials that will become part of a final product or service.
"Raw materials" means the materials that are converted or combined during the manufacturing process.

§ 41-1624.01 Contracts; services to state agencies and others; lease of real property

A. The director shall compensate prisoners for their services pursuant to section 31-254.

B. The director or his designee may contract with any state agency, political subdivision or state department or any private person, firm, corporation or association to provide services or labor rendered by prisoners.

C. All monies derived from contract services provided pursuant to subsection B of this section shall be deposited in the fund established pursuant to section 41-1624.

D. Subject to legislative appropriation, the director or his designee may contract with any private person, firm, corporation or association to lease real property for the operation of Arizona correctional industries.

§ 41-1625 Arizona correctional industries; prisoner workplace injuries; evidence; medical and health services

In an action for damages that a prisoner brings against a private person, firm, corporation or association that is engaged in a contract pursuant to section 41-1624.01 for injury or death arising from the prisoner's work in Arizona correctional industries, the prisoner may not introduce into evidence the amount or cost of medical and health services the department or this state provided to the prisoner or paid on the prisoner's behalf pursuant to section 31-201.01 as a result of the prisoner's injury or death, except that the prisoner may introduce into evidence any amount the prisoner has paid for or contributed to secure the prisoner's right to medical and health services.

§ 41-1627 Fixing prices

The department shall fix and determine the prices at which all articles, services or products manufactured or produced shall be furnished or sold. The prices shall be uniform and nondiscriminating to all agencies of this state. The prices may be fixed and determined in any amounts as will permit the articles, services or products to compete on the free market.

§ 41-1628 Catalogues of articles and products; distribution; estimates of needs by departments

The department shall cause to be prepared, at such times as it may determine, consistent with sound marketing principles, catalogues containing the description of all articles and products manufactured or produced by it pursuant to the provisions of this article, copies of which shall be sent to all offices, departments, institutions and agencies of the state and shall be made accessible to all political subdivisions of the state and the public. At least thirty days before the commencement of each fiscal year, the proper official of each such office, department, institution, or agency, when required by the department, shall report to the department estimates for such fiscal year of the kind and amount of articles and products reasonably required for such ensuing year, referring in such estimates to the catalogue issued by the department insofar as articles and products indicated are included in this catalogue.

§ 41-1629 Order of distribution of articles, services and products; sale of surplus products

A. The articles or products manufactured or produced or services provided by Arizona correctional industries in accordance with the provisions of this article shall be devoted to both:

Fulfilling the requirements of the offices, departments, institutions and agencies of the state that are supported in whole or in part by the state.
Providing the political subdivisions of the state and the public with such articles, services and products.

B. To prevent loss to the state, the director or the director's designee may dispose of surplus products developed from the operations of Arizona correctional industries in prisons, institutions or locations under the jurisdiction of the director by sale to private persons, firms, corporations or associations in any other state, to foreign governments, to corporations for distribution in foreign countries, and to private persons or their agents in markets outside the United States and in countries which permit the importation of prison-made goods.

C. All articles or products manufactured or produced or services provided by Arizona correctional industries, except agricultural products, shall be priced at not less than the actual cost of producing and marketing the product plus an allowance for overhead and administrative costs and a reasonable profit to provide fiscal resources for the research and development of inmate work programs. Arizona correctional industries shall defray its costs, on an accrual basis, out of receipts from the sale of articles and products.

D. All profits earned from the sale of articles, services or products pursuant to subsection B shall be deposited in the Arizona correctional industries revolving fund.

§ 41-1630 Violation; classification

Any person who violates any provision of this article, is guilty of a class 1 misdemeanor.

Article 4 Corrections Fund

§ 41-1641 Corrections fund; uses; prior approval; exemption; transfer

A. The corrections fund is established and consists of monies received from the distribution provided pursuant to section 42-3104. The state department of corrections shall administer the fund. Monies in the fund are subject to legislative appropriation.

B. Monies in the corrections fund may be expended by:

The director of the department of administration for major maintenance, construction, lease, purchase, renovation or conversion of corrections or state operated juvenile facilities subject to the prior approval of the joint committee on capital review and the legislature.
The director of the state department of corrections for costs incurred in the minor maintenance and the operations of corrections facilities subject to the prior approval of the legislature.
The director of the department of juvenile corrections for costs incurred in the minor maintenance and the operations of state operated juvenile facilities subject to the prior approval of the legislature.

C. Notwithstanding any law to the contrary and except as provided in subsection B of this section:

The director of the state department of corrections shall enter into an agreement with the director of the department of administration for the expenditure of monies for the maintenance of corrections facilities.
The director of the department of juvenile corrections shall enter into an agreement with the director of the department of administration for the expenditure of monies for the maintenance of state operated juvenile facilities.

D. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. The director of the state department of corrections shall transfer two million five hundred thousand dollars from the corrections fund annually to the department of corrections building renewal fund established by section 41-797.

Article 5 Prison Construction and Operations Fund

§ 41-1651 Prison construction and operations fund

The prison construction and operations fund is established consisting of monies received pursuant to sections 5-395.01, 5-396, 5-397, 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288. The state department of corrections shall administer the fund. Monies in the fund are subject to legislative appropriation and shall be used to pay for any costs related to prison overcrowding and department support and maintenance.

Article 6 Correctional Officer Training

§ 41-1661 Definitions

In this article, unless the context otherwise requires:

"Academy" means the correctional officer training academy.
"Board" means the Arizona peace officer standards and training board.
"Correctional officer" means a person, other than an elected official, who is employed by this state or a county, city or town and who is responsible for the supervision, protection, care, custody or control of inmates in a state, county or municipal correctional institution, including counselors but excluding secretarial, clerical and professionally trained personnel.
"Director" means the director of the state department of corrections.
"Employing agency" means this state or the county or municipal agency which employs correctional officers.

§ 41-1662 General training powers and duties of the director; fund

A. The director shall:

Operate a correctional officer training academy.
Establish and maintain a correctional officer training program at the academy.

B. The director may:

Employ personnel and faculty as may be necessary to perform the academy's functions and operate the academy.
Enter into contracts, including intergovernmental agreements under title 11, chapter 7, article 3, as may be necessary to administer this article. Counties, cities and towns may contract for training their correctional officers at the academy.
Adopt administrative rules for implementing this article and for the academy's internal management and control.
Solicit, accept, spend and account for gifts and grants. A separate, permanent training fund is established. The director shall administer the fund. Monies received as gifts or grants shall be deposited in the fund. Monies received as gifts or grants are subject to section 35-149.

§ 41-1664 Tuition and fees; reimbursement

The director shall establish reasonable tuition and fees to cover the costs of all aspects of training provided to enrollees. An employing agency shall pay all of the tuition and fees of its employees or its recruit trainees attending the academy. The director shall deposit these monies in the training fund established by section 41-1662, subsection B, paragraph 4.

Article 7 Private Employers on Grounds of Correctional Facilities

§ 41-1671 Agreements with private employers; leases

A. The director, in consultation with the director of the department of administration and the chief executive officer of the Arizona commerce authority, may establish programs for the employment of offenders by private employers and enter into agreements with private employers under which the employer constructs, leases or otherwise establishes facilities within the exterior boundaries of any adult correctional facility to manufacture or process goods or conduct any other business, commercial or agricultural enterprise and employ offenders at the correctional facility.

B. As a part of or in connection with any agreement made under this section the director may lease, for an initial term of not more than twenty years, any land and improvements located on the grounds of any adult correctional facility for use by the private employer to provide employment under this article.

§ 41-1672 Voluntary employment

An offender may be employed under this article only on a voluntary basis and only after the offender has been informed of the conditions of the offender's employment.

§ 41-1673 Application of other laws

A. An offender employed under this article is not eligible for unemployment compensation benefits under title 23, chapter 4.

B. An enterprise operating on correctional facility premises under this article is subject to all laws and rules otherwise governing the operation of similar enterprises in this state.

§ 41-1674 Compensation of employed prisoners; payment and disposition

A. If an agreement is entered into between the director and a private employer under this article to provide employment for prisoners and the program is federally certified as a prison industry enhancement program, the agreement shall provide that an employed prisoner shall be paid at least the minimum wage, established by federal law, in the manner established by title 23, chapter 2, article 7, except as otherwise provided by this section.

B. The compensation of a prisoner employed under this article shall be surrendered to the department and shall be distributed in the following order:

At least twenty per cent of the prisoner's gross compensation shall be credited to the prisoner's retention or spendable account pursuant to section 31-254.
Ten per cent of the prisoner's gross compensation shall be deposited in the victim compensation and assistance fund established by section 41-2407.
Thirty per cent of the prisoner's gross compensation shall be deducted for room and board and shall be transmitted to the state treasurer for deposit in the state general fund.
Fifteen per cent of the prisoner's gross compensation shall be deducted for the support of the prisoner's dependents on the order of a court of competent jurisdiction. If the dependents are receiving any welfare assistance, the department shall notify the appropriate welfare agency of the payments under this paragraph.
Mandatory deductions shall be deducted pursuant to section 31-254 and any remaining amount shall be credited to the prisoner's retention account. The department shall return the amount in the prisoner's retention account to the prisoner at the time the prisoner is released on community supervision or probation if the court waived community supervision pursuant to section 13-603 or the prisoner is discharged.

C. The prisoner's employer shall withhold state and federal income taxes and social security deductions.

Article 8 Private Prisons

§ 41-1681 Definition

For the purposes of this article, "private prison" means any privately owned prison that does not contract exclusively with the state department of corrections and is primarily directed at housing adult prisoners who are sentenced to serve a term of detention or incarceration by a court from a state other than this state.

§ 41-1682 Private prisons; prohibitions; liability for services; financial responsibility

A. No private prison may operate in this state unless the private contractor complies with this section.

B. A private prison shall provide the department of administration with financial responsibility to cover this state's potential liability in the amount of ten million dollars. The monies shall be used by the state if the state is held liable for civil damages resulting from the escape of a prisoner from the private prison. The private prison may file proof of financial responsibility by filing one of the following:

Proof that ten million dollars is deposited in the private prison escapee fund established by section 41-1830.31.
An insurance policy that is in a form approved by the department of administration that provides civil liability and civil rights liability coverage in the amount of ten million dollars and listing the state as an insured.
A surety bond with the principal sum of ten million dollars.
A certified financial statement that is not more than ninety days old and that shows a net worth of more than fifteen million dollars. Every ninety days the private prison shall submit a certified financial statement to the department of administration signed under oath by the chief financial officer of the prison. If the financial statement indicates a net worth of less than fifteen million dollars, the private prison shall comply with paragraphs 1, 2 or 3 of this subsection.

C. An insurance company or surety company duly authorized to transact business in this state shall execute the insurance policy or bond prescribed in subsection B of this section.

D. The insurance policy or surety bond shall continue in effect until ninety days after the private prison is sold or closed. Any monies deposited in the private prison escapee fund by the private prison shall be refunded to the private prison within ninety days after submission of evidence to the director of the department of administration that the private prison is either sold or closed and there are no remaining liabilities for which the state might be required to assume responsibility.

E. On receipt by the director of the department of administration of notice to cancel an insurance policy or bond by an insurance company or surety, the director shall immediately notify the private prison on the insurance policy or the surety bond of the effective date of cancellation of the insurance policy or the surety bond. The private prison shall furnish a like insurance policy or surety bond within thirty days after mailing of the notice by the director. Unless a replacement insurance policy or surety bond is filed with the director, the right of the private prisons to operate in this state shall be suspended by operation of law on the date the bond is canceled.

F. If any of the monies required by subsection B, paragraph 1 of this section are used to satisfy civil damage claims or civil rights claims, the private prison shall reestablish the full amount of those monies within thirty days after notification by the director of the department of administration.

G. A security officer employed by a private prison contractor shall be at least twenty-one years of age and have no felony convictions.

§ 41-1683 Private prison; prisoner identification; notice

A. Private prisons shall maintain photographs and fingerprints on site of all prisoners incarcerated in the facility.

B. Before another state transfers prisoners to a private prison in this state, the private prison housing prisoners under incarceration orders from a court of another state shall provide the governor, the director of the department of public safety and the director of the state department of corrections with the following information:

The number of prisoners to be transferred.
The names of the prisoners to be transferred.
The date of the transfer.
The security level of each prisoner to be transferred, as determined by the sentencing state.

C. If one to ten prisoners are transferred into this state, the private prison shall comply with the notification requirements in subsection B at least forty-eight hours before the prisoners arrive in this state. If eleven or more prisoners are transferred into this state, the private prison shall comply with the notification requirements pursuant to subsection B at least seven days before the prisoners arrive in this state.

D. The information provided pursuant to subsection B, paragraphs 2, 3 and 4 shall not be public record until the transfer of the prisoners is completed.

§ 41-1684 Release of prisoner; return to state of origin

If a prisoner in a private prison who was sentenced by a court in another state is to be released from incarceration, the private prison contractor shall transfer or return the prisoner to the state where the prisoner was sentenced before releasing the prisoner.

Chapter 12 Public Safety

Article 1 Definitions

§ 41-1701 Definitions

In this chapter, unless the context otherwise requires:

"Board" means the Arizona peace officer standards and training board.
"Criminal history record information" means information collected by criminal justice agencies on individuals consisting of identifiable descriptions and notations of arrests, detentions, indictments, informations, or other formal criminal charges, and any disposition arising therefrom, sentencing, correctional supervision, and release.
"Criminal justice agency" means courts or a government agency or any subunit thereof which performs detection, apprehension, detention, pretrial release, post-trial release, prosecution, adjudication, correctional supervision, or rehabilitation of accused persons or criminal offenders.
"Department" means the department of public safety.
"Director" means the director of the department of public safety.
"Patrol" means the Arizona highway patrol.
"Peace officer" means any personnel of the department designated by the director as being a peace officer under the provisions of this chapter.
"Reserve" means the department of public safety reserve.

Article 2 Department of Public Safety

§ 41-1711 Department of public safety; purpose; location; qualifications of director; responsibilities

A. There shall be a department of public safety which is responsible for creating and coordinating services for use by local law enforcement agencies in protecting the public safety. The principal office and headquarters of the department shall be in Phoenix.

B. The department shall formulate plans with a view to establishing modern services for prevention of crime, apprehension of violators, training of law enforcement personnel, and the promotion of public safety. The department shall in no way preempt the authority and jurisdiction of established agencies of political subdivisions of the state.

C. The director shall be selected on the basis of training and experience with a minimum of five years' experience in the administration of law enforcement.

D. The director shall be appointed by the governor pursuant to section 38-211 to serve concurrently with the appointing governor and shall be subject to removal for cause, including but not limited to malfeasance, misfeasance and nonfeasance in office. The director shall receive annual compensation as determined pursuant to section 38-611.

E. The director shall be directly responsible to the governor for the conduct and the administration of the department. If the director is unable to act, the deputy director shall direct the activities of the department during the period in which the director is unable to act. If the director and deputy director are unable to act, the governor shall direct the activities of the department during the period in which the director and deputy director are unable to act.

F. The director shall prescribe procedures for use of department personnel, facilities, equipment, supplies and other resources in assisting search or rescue operations.

G. The director shall be responsible for the establishment, operation and maintenance of the statewide emergency medical services communication system prescribed by section 41-1835.

H. The director may purchase, lease, equip, staff and operate air ambulances, including ambulance helicopters, pursuant to section 41-1834.

I. To limit the expenditures of monies derived from the state highway fund established pursuant to article IX, section 14, Constitution of Arizona, to traffic safety and traffic law enforcement purposes, the department of public safety shall:

Maintain a strict account of all costs incurred by each function of the department. Such costs shall be determined and allocated between traffic safety or traffic law enforcement functions and all other departmental functions and shall include such costs as wages or salaries, materials or supplies and equipment or facility use.
Immediately following the determination of all such costs certify to the office of strategic planning and budgeting the full amount of all such costs relating to the various functions within the department.

J. The office of strategic planning and budgeting shall annually submit a separate report to the legislature compiled from the department's functional costs certification indicating the complete breakdown between those costs which are related to traffic safety or traffic law enforcement functions and the various other functions within the department. The director of the department of administration shall include within the director's annual report to the legislature a recommendation for a separate appropriation to reimburse the state highway fund from the state general fund for any expenditures from the state highway fund during the prior fiscal year in excess of the total of all costs related to traffic safety or traffic law enforcement functions of the department.

K. The director shall establish a special hazardous materials emergency response organizational unit within the department to function as the initial response element of the hazardous materials emergency management program pursuant to section 49-123.

L. The department is designated as this state's recipient of federal victims of crime act grants.

§ 41-1712 Organization of department; divisions

(L03, Ch. 263, sec. 46. Eff. until 7/1/27)

A. The department shall consist of the following divisions:

Arizona highway patrol.
Narcotics enforcement and criminal investigation.
Scientific criminal analysis.
Training and education.

B. The department may establish district headquarters and stations at various places in the state, using existing facilities wherever possible, with the personnel and equipment necessary for the proper functioning and operation of the headquarters and stations.

C. The director may establish other divisions or reserves or reorganize or consolidate the department.

§ 41-1712 (Version 2) Organization of department; divisions

(L22, Ch. 311, sec. 3. Eff. 7/1/27)

A. The department shall consist of the following divisions:

Arizona highway patrol.
Narcotics enforcement and criminal investigation.
Scientific criminal analysis.
Training and education.
Major incident division.

B. The department may establish district headquarters and stations at various places in this state, using existing facilities wherever possible, with the personnel and equipment necessary for the proper functioning and operation of the headquarters and stations.

C. The director may establish other divisions or reserves or reorganize or consolidate the department.

§ 41-1713 Powers and duties of director; authentication of records

A. The director of the department shall:

Be the administrative head of the department.
Subject to the merit system rules, appoint, suspend, demote, promote or dismiss all other classified employees of the department on the recommendation of their respective division superintendent. The director shall determine and furnish the law enforcement merit system council established by section 41-1830.11 with a table of organization. The superintendent of each division shall serve at the concurrent pleasure of the director and the governor.
Except as provided in sections 12-119, 41-1304 and 41-1304.05, employ officers and other personnel as the director deems necessary for the protection and security of the state buildings and grounds in the governmental mall described in section 41-1362, state office buildings in Tucson and persons who are on any of those properties. Department officers may make arrests and issue citations for crimes or traffic offenses and for any violation of a rule adopted under section 41-796. For the purposes of this paragraph, security does not mean security services related to building operation and maintenance functions provided by the department of administration.
Make rules necessary for the operation of the department.
Annually submit a report of the work of the department to the governor and the legislature, or more often if requested by the governor or the legislature.
Appoint a deputy director with the approval of the governor.
Adopt an official seal that contains the words "department of public safety" encircling the seal of this state as part of its design.
Investigate, on receipt, credible evidence that a licensee or registrant has been arrested for, charged with or convicted of an offense that would preclude the person from holding a license or registration certificate issued pursuant to title 32, chapter 26.
Cooperate with the Arizona-Mexico commission in the governor's office and with researchers at universities in this state to collect data and conduct projects in the United States and Mexico on issues that are within the scope of the department's duties and that relate to quality of life, trade and economic development in this state in a manner that will help the Arizona-Mexico commission to assess and enhance the economic competitiveness of this state and of the Arizona-Mexico region.
Adopt and administer the breath, blood or other bodily substances test rules pursuant to title 28, chapter 4.
Develop procedures to exchange information with the department of transportation for any purpose related to sections 28-1324, 28-1325, 28-1326, 28-1462 and 28-3318.
Collaborate with the state forester in presentations to legislative committees on issues associated with wildfire prevention, suppression and emergency management as provided by section 37-1302, subsection B.

B. The director may:

Issue commissions to officers of the department.
Request the cooperation of the utilities, communication media and public and private agencies and any sheriff or other peace officer in any county or municipality, within the limits of their respective jurisdictions when necessary, to aid and assist in the performance of any duty imposed by this chapter.
Cooperate with any public or private agency or person to receive or give necessary assistance and may contract for such assistance subject to legislative appropriation controls.
Utilize the advice of the board and cooperate with sheriffs, local police and peace officers within the state for the prevention and discovery of crimes, the apprehension of criminals and the promotion of public safety.
Acquire in the name of the state, either in fee or lesser estate or interest, all real or any personal property that the director considers necessary for the department's use, by purchase, donation, dedication, exchange or other lawful means. All acquisitions of personal property pursuant to this paragraph shall be made as prescribed in chapter 23 of this title unless otherwise provided by law.
Dispose of any property, real or personal, or any right, title or interest in the property, when the director determines that the property is no longer needed or necessary for the department's use. Disposition of personal property shall be as prescribed in chapter 23 of this title. The real property shall be sold by public auction or competitive bidding after notice published in a daily newspaper of general circulation, not less than three times, two weeks before the sale and subject to the approval of the director of the department of administration. When real property is sold, it shall not be sold for less than the appraised value as established by a competent real estate appraiser. Any monies derived from the disposal of real or personal property shall be deposited, pursuant to sections 35-146 and 35-147, in the Arizona highway patrol fund as authorized by section 41-1752, subsection B, paragraph 6.
Sell, lend or lease personal property directly to any state, county or local law enforcement agency. Personal property may be sold or leased at a predetermined price without competitive bidding. Any state, county or local law enforcement agency receiving personal property may not resell or lease the property to any person or organization except for educational purposes.
Dispose of surplus property by transferring the property to the department of administration for disposition to another state budget unit or political subdivision if the state budget unit or political subdivision is not a law enforcement agency.
Lease or rent personal property directly to any state law enforcement officer for the purpose of traffic safety, traffic control or other law enforcement related activity.
Sell for one dollar, without public bidding, the department issued handgun or shotgun to a department officer on duty related retirement pursuant to title 38, chapter 5, article 4. Any monies derived from the sale of the handgun or shotgun to the retiring department officer shall be deposited, pursuant to sections 35-146 and 35-147, in the Arizona highway patrol fund as authorized by section 41-1752, subsection B, paragraph 6.
Conduct state criminal history records checks for the purpose of updating and verifying the status of current licensees or registrants who have a license or certificate issued pursuant to title 32, chapter 26. The director shall investigate, on receipt, credible evidence that a licensee or registrant has been arrested for, charged with or convicted of an offense that would preclude the person from holding a registration certificate issued pursuant to title 32, chapter 26.
Grant a maximum of two thousand eighty hours of industrial injury leave to any sworn department employee who is injured in the course of the employee's duty, any civilian department employee who is injured in the course of performing or assisting in law enforcement or hazardous duties or any civilian department employee who was injured as a sworn department employee rehired after August 9, 2001 and would have been eligible pursuant to this paragraph and whose work-related injury prevents the employee from performing the normal duties of that employee's classification. This industrial injury leave is in addition to any vacation or sick leave earned or granted to the employee and does not affect the employee's eligibility for any other benefits, including workers' compensation. The employee is not eligible for payment pursuant to section 38-615 of industrial injury leave that is granted pursuant to this paragraph. Subject to approval by the law enforcement merit system council, the director shall adopt rules and procedures regarding industrial injury leave hours granted pursuant to this paragraph.
Sell at current replacement cost, without public bidding, the department issued badge of authority to an officer of the department on the officer's promotion or separation from the department. Any monies derived from the sale of the badge to an officer shall be deposited, pursuant to sections 35-146 and 35-147, in the department of public safety administration fund to offset replacement costs.

C. The director and any employees of the department that the director designates in writing may use the seal adopted pursuant to subsection A, paragraph 7 of this section to fully authenticate any department records and copies of these records. These authenticated records or authenticated copies of records shall be judicially noticed and shall be received in evidence by the courts of this state without any further proof of their authenticity.

§ 41-1713.01 Deputy director; powers and duties; compensation

A. The primary responsibility of the deputy director is to assist the director and perform functions and duties assigned by the director.

B. The deputy director is exempt from chapter 4, articles 5 and 6 of this title and is eligible to receive compensation pursuant to section 38-611.

§ 41-1714 Merit system for department employees

The employees of the department shall be included under the merit system council of the Arizona highway patrol or its successor, the law enforcement merit system council, if established by law.

§ 41-1715 Department of public safety reserve

The director may provide for a volunteer organization to be known as the department of public safety reserve, which organization shall consist of United States citizens who are residents of the state of Arizona and who shall render auxiliary support, without compensation, to the department as the director may prescribe. This organization may consist of volunteers who are peace officers and volunteers who are not peace officers.

§ 41-1716 Powers of reserve

The director shall define the powers and duties of the reserve, but such powers and duties shall not be in excess of those accorded to department employees nor inconsistent therewith.

§ 41-1717 Reserve; badge of authority

A. The director shall issue to each member of the reserve a badge of authority to be used by the members of the reserve for activities authorized by the director. The badge shall be of such design as the director may determine, but shall bear the word "reserve" across the face thereof.

B. A member of the reserve performing activities authorized by the director for an employer is not a state employee for any purpose, including workers' compensation benefits under section 41-1718. An entity employing a reserve officer to perform activities authorized by the director shall file a statement with the department that the employee is the agent of the employer and not the state of Arizona.

§ 41-1718 Eligibility for workers' compensation benefits

While on duty, members of the reserve shall be deemed to be state employees for the purpose of securing workers' compensation benefits in the same manner, under the same conditions, and to the same extent as regular state employees.

§ 41-1719 Sex offender community notification coordinator; duties

A. The sex offender community notification coordinator is established in the department of public safety.

B. The sex offender community notification coordinator shall:

Oversee reimbursement of monies to agencies that perform sex offender community notification.
Oversee the Arizona sex offender community notification process.

§ 41-1720 Parity compensation fund

A. The parity compensation fund is established consisting of monies deposited pursuant to section 28-5808 and monies appropriated by the legislature. The department shall administer the fund and, considering state revenues and state employee pay adjustments. The department shall spend monies from the fund for salaries and benefits for law enforcement personnel that the department determines will enhance the ability of the department to successfully recruit and retain qualified law enforcement personnel. In determining the amount of the expenditures from the fund, the department shall annually establish and consider benchmarks based on the average total compensation for each comparable law enforcement personnel rank of the department's three largest county or municipal peer law enforcement agencies in this state. For the purposes of this subsection, "total compensation" includes base salary, educational incentive pay, physical performance pay, longevity pay and retirement contributions made by an employer on behalf of an employee.

B. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. Fund monies:

Do not revert to the state general fund.
Are exempt from the provisions of section 35-190 relating to lapsing of appropriations.
Are subject to legislative appropriation.

§ 41-1721 Families of fallen police officers special plate fund

The families of fallen police officers special plate fund is established consisting of monies received pursuant to section 28-2427. The department of public safety shall administer the fund. The first thirty-two thousand dollars received shall be reimbursed to the entity that paid the implementation fee to the department of transportation pursuant to section 28-2427, subsection A. Not more than ten per cent of monies deposited in the fund annually shall be used for the cost of administering the fund. Monies in the fund are continuously appropriated. The department of public safety shall allocate monies from the fund to the incorporated nonprofit corporation in this state that paid the implementation fee to the department of transportation pursuant to section 28-2427, subsection A and is qualified under section 501(c)(3) of the United States internal revenue code for federal income tax purposes if the nonprofit corporation demonstrates a commitment to helping in the healing of family survivors of police officers who died in the line of duty in this state, provides training to law enforcement agencies on survivor victimization issues and educates the public about the need to support the law enforcement profession and families of fallen police officers.

§ 41-1722 Concealed weapons permit fund

A. The concealed weapons permit fund is established consisting of fees collected pursuant to section 13-3112.

B. The department shall administer the fund. Monies deposited in the fund are subject to legislative appropriation and must only be used by the department to:

Administer the concealed weapons permit process established by section 13-3112 and all matters related to that section.
Pay for the department's operating expenses.

C. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-1723 Public safety equipment fund; distribution

A. The public safety equipment fund is established consisting of monies deposited in the fund pursuant to sections 12-116.04, 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288. The department shall administer the fund.

B. The first one million two hundred thousand dollars deposited in the public safety equipment fund each fiscal year pursuant to sections 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288 is continuously appropriated to the department for vehicles, protective armor, electronic stun devices and other safety equipment. Monies appropriated pursuant to this subsection are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

C. Monies deposited in the public safety equipment fund pursuant to section 12-116.04 are subject to legislative appropriation and shall be used by the department for vehicles, protective armor, electronic stun devices and other safety equipment.

D. Notwithstanding subsection A of this section and sections 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288, in each fiscal year, after the first one million two hundred thousand dollars is deposited in the public safety equipment fund pursuant to sections 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288, the state treasurer shall deposit the remaining monies received pursuant to sections 28-1381, 28-1382, 28-1383, 28-8284, 28-8286, 28-8287 and 28-8288 in the state general fund.

§ 41-1724 Gang and immigration intelligence team enforcement mission fund; subaccount; use of monies; reporting requirements

A. The gang and immigration intelligence team enforcement mission fund is established consisting of monies deposited pursuant to section 11-1051 and monies appropriated by the legislature. The department shall administer the fund. Any monies distributed from the fund to a county sheriff shall go directly to the county sheriff and are not subject to any form of approval by the board of supervisors. Monies in the fund are subject to legislative appropriation.

B. Monies in the fund shall be used for employer sanctions enforcement, enforcing human smuggling and drug smuggling laws, gang and strict immigration enforcement, county jail reimbursement costs relating to illegal immigration and any other use previously authorized in an allocation made by law for the gang and immigration intelligence team enforcement mission.

C. Each year that monies are available in the fund and as soon as is practicable after July 1 of each year, the first $500,000 shall be allocated to a county sheriff of a county with a population of less than five hundred thousand persons but more than three hundred thousand persons and any remaining monies shall be used for agreements or contracts in accordance with subsection D of this section, except that no monies may be used for agreements or contracts with a county sheriff of a county with a population of more than three million persons.

D. If the department uses monies from the fund for an agreement or contract with a city, town, county or other entity to provide services for the gang and immigration intelligence team enforcement mission, the city, town, county or other entity shall provide not less than twenty-five percent of the cost of the services and the department shall provide not more than seventy-five percent of personal services and employee related expenditures for each agreement or contract but may fund all capital related equipment. This subsection does not apply to a county with a population of less than five hundred thousand persons but more than three hundred thousand persons.

E. The gang and immigration intelligence team enforcement mission border security and law enforcement subaccount is established consisting of monies deposited pursuant to section 12-116.04 and monies appropriated by the legislature. The department shall administer the subaccount. Any monies distributed from the subaccount to a county sheriff shall go directly to the county sheriff and are not subject to any form of approval by the board of supervisors. Monies in the subaccount are subject to legislative appropriation. All appropriated monies in the subaccount shall be distributed each fiscal year to local entities and no monies may be retained by the department for its own use. The monies in the subaccount shall be used for law enforcement purposes related to border security, including border personnel, and for safety equipment that is worn or used by a peace officer who is employed by a county sheriff.

F. A law enforcement agency shall not receive any monies from the fund unless the law enforcement agency certifies each fiscal year in writing to the director of the department of public safety that the law enforcement agency is complying with section 11-1051 to the fullest extent allowed by law.

G. The department shall submit an expenditure plan to the joint legislative budget committee for review before expending any monies not identified in the department's previous expenditure plans. Within thirty days after the last day of each calendar quarter, the department shall provide a summary of quarterly and year-to-date expenditures and progress to the joint legislative budget committee, including any prior year appropriations that were nonlapsing.

H. Before the department spends any monies appropriated in the general appropriations act each fiscal year from the gang and immigration intelligence team enforcement mission border security and law enforcement subaccount established by subsection E of this section, the department shall submit the subaccount's entire expenditure plan to the joint legislative budget committee for review.

§ 41-1725 Capitol police administrative towing fund

The capitol police administrative towing fund is established consisting of monies deposited pursuant to section 28-3513. The department shall administer the fund. The monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. The monies in the fund may be used by the capitol police for law enforcement purposes.

§ 41-1726 Blue alert notification system; requirements

A. The department shall establish the blue alert notification system as a quick response system designed to issue and coordinate alerts following an attack on a law enforcement officer as described in subsection B of this section.

B. On the request of an authorized person at a law enforcement agency that is investigating an offense described in paragraph 1 of this subsection, the department shall issue a blue alert if all of the following conditions are met:

A law enforcement officer has been killed, suffered serious bodily injury or has been assaulted with a deadly weapon and the suspect has fled the scene of the offense.
A law enforcement agency investigating the offense has determined that the suspect poses an imminent threat to the public or other law enforcement personnel.
A detailed description of the suspect's vehicle or license plate is available for broadcast.
Public dissemination of available information may help avert further harm or accelerate apprehension of the suspect.

C. If the department issues a blue alert pursuant to this section, the department shall provide the blue alert information to any other entity that provides similar notifications in this state.

§ 41-1727 Victims' rights enforcement fund; use; reporting

A. The victims' rights enforcement fund is established consisting of monies collected pursuant to sections 5-568 and 12-116.09 and monies available from any other source. The department shall administer the fund, shall distribute the monies to qualifying organizations and entities and may use up to five percent of the monies deposited in the fund for its administrative costs. Monies in the fund are continuously appropriated.

B. On application, the department shall annually distribute monies from the fund to nonprofit organizations and entities that can demonstrate a five-year history of providing, without cost to the crime victim, each of the following services to crime victims:

Legal representation to enforce the rights of crime victims as counsel of record in criminal cases.
Social services to assist the crime victim during the course of the legal representation.

C. An organization or entity that applies for monies pursuant to this section may establish its qualifications through an attorney who otherwise meets the requirements of subsection B of this section.

D. An organization that qualifies under the terms of subsection B of this section shall be funded to provide the services included in subsection B of this section without limitation on the types of crimes against victims, including administrative support for the services. Each organization and entity that receives funding pursuant to this section shall submit an annual report to the department that details the organization's or entity's budget for the program and all of the sources and amounts of public monies that are spent on the program that provides the services to crime victims included in subsection B of this section. The report shall include the following:

The expenditures of the public monies.
The level of crime victim satisfaction with the services.

E. This section does not require the reporting of the name or personal identifying information of any crime victim or crime victim advocate, any information protected under the attorney-client privilege or any information the crime victim requests to remain private.

§ 41-1728 Seek and find alert notification system; requirements; definitions

A. The department shall establish the seek and find alert notification system as a quick response system designed to issue and coordinate alerts following the report of a missing person who has a developmental disability or a cognitive disability, Alzheimer's disease or dementia or is sixty-five years of age or older as described in subsection B of this section.

B. On the request of an authorized person at a law enforcement agency that is investigating a report of a missing person who has a developmental disability or a cognitive disability, Alzheimer's disease or dementia or is sixty-five years of age or older, the department shall request an activation of the emergency alert system and issue a seek and find alert immediately, regardless of the missing person's age, if all of the following conditions are met:

The missing person has a developmental disability or a cognitive disability, Alzheimer's disease or dementia or is sixty-five years of age or older.
The law enforcement agency investigating the missing person report:

(a) Has used all available local resources.

(b) Has determined that the person has gone missing under unexplained or suspicious circumstances.

(c) Believes that the missing person is in danger because of age, health, mental or physical disability, environment or weather conditions, that the missing person is in the company of a potentially dangerous person or that there are other factors indicating that the missing person may be in peril.

There is information available that, if disseminated to the public, could assist in the safe recovery of the missing person.
The department has been designated to use the federally authorized emergency alert system for the issuance of seek and find alerts.

C. The department shall request an activation of the emergency alert system and issue a seek and find alert immediately pursuant to subsection B of this section. A seek and find alert may not be denied or delayed due to administrative processes, prior missing episodes or discretionary assessments that are unrelated to the immediate risk to the missing person's safety.

D. If the department issues a seek and find alert pursuant to this section, the department shall provide the seek and find alert information to any other entity that provides similar notifications in this state.

E. All law enforcement agencies in this state shall do all of the following:

Develop, implement and regularly update training criteria regarding the seek and find alert notification system pursuant to this section. The training shall be comprehensive and shall create a solid foundation of knowledge regarding the legal criteria and processes involved in issuing a timely seek and find alert.
Conduct seek and find alert notification training for all employees of a law enforcement agency, at the time of hire and biannually, who have direct involvement in missing person cases, including the supervisors of these employees and communication dispatchers. The training shall include a review of any department and state policies regarding locating missing, abducted or runaway persons, with a specific focus on seek and find alert procedures. The training shall be comprehensive and shall create a solid foundation of knowledge regarding the legal criteria and processes involved in issuing a timely seek and find alert.

F. For the purposes of this section:

"Cognitive disability" has the same meaning prescribed in section 36-551.
"Developmental disability" has the same meaning prescribed in section 36-551.

§ 41-1728.01 Turquoise alert system; requirements; definitions

A. The department shall establish the turquoise alert system as a quick response system designed to issue and coordinate alerts following the report of a missing person.

B. On the request of an authorized person at a law enforcement agency that is investigating a report of a missing person, the department shall request an activation of the emergency alert system and issue a turquoise alert if all of the following conditions are met:

The missing person is under sixty-five years of age.
The law enforcement agency investigating the missing person report:

(a) Has used all available local resources.

(b) Has determined that the person has gone missing under unexplained or suspicious circumstances.

(c) Believes that the missing person is in danger or that the missing person is in the company of a potentially dangerous person or that there are other factors indicating that the missing person may be in peril.

There is information available that, if disseminated to the public, could assist in the safe recovery of the missing person.
The department has been designated to use the federally authorized emergency alert system for the issuance of turquoise alerts.

C. If the department issues a turquoise alert pursuant to this section, the department shall provide the turquoise alert information to any other entity that provides similar notifications in this state.

D. For the purposes of this section:

"Law enforcement agency" means the Arizona department of public safety, a municipal police department, a county sheriff's office, a tribal law enforcement agency and a federal law enforcement agency that operates within this state.
"Person" includes a member of a federally recognized Indian Tribe.

§ 41-1729 Law enforcement agencies; access to criminal justice information

The department shall provide a law enforcement agency with access to the case information that it receives from the supreme court pursuant to sections 13-609, 14-5304 and 36-540 for the purpose of enforcing a court order, assisting in an investigation or returning property.

§ 41-1730 Department of public safety forensics fund; purposes; distributions; definition

A. The department of public safety forensics fund is established. The department shall administer the fund. Monies in the fund are subject to legislative appropriation. The department of public safety forensics fund consists of the following:

Monies deposited pursuant to section 12-116.01, subsection J.
Monies deposited pursuant to section 41-2401, subsection D, paragraphs 1 and 10.
Surcharge monies deposited pursuant to section 28-3396.
Monies contributed to the fund from any other source.

B. Monies in the department of public safety forensics fund shall be used for the following purposes:

Purchasing and installing fingerprint identification equipment.
Operating, maintaining and administering the Arizona automated fingerprint identification system and the system's remote terminals.
Crime laboratory operations and enhanced services.
Educating and training forensic scientists who are regularly employed in a crime laboratory.
Purchasing and maintaining scientific equipment for crime laboratory use.
Implementing, operating and maintaining deoxyribonucleic acid testing and administering the Arizona deoxyribonucleic acid identification system.

C. On a quarterly basis, the department of public safety shall allocate and distribute the monies in the department of public safety forensics fund that are collected pursuant to section 12-116.01 and deposited pursuant to section 41-2401, subsection D, paragraph 10 to each full-service crime laboratory.

D. The distribution of monies pursuant to subsection C of this section shall be determined annually based on the proportion of crimes reported to the department for the most recent year for the jurisdiction or jurisdictions where each full-service crime laboratory provides full-service crime laboratory services in relation to the total number of crimes reported in all jurisdictions in this state. The minimum allocation for a political subdivision that provides full-service crime laboratory services is four percent. For the purposes of this subsection:

In fiscal years 2023-2024, 2024-2025 and 2025-2026, the department shall calculate the number of crimes reported in accordance with the federal bureau of investigation's uniform crime reporting program summary reporting system classification criteria.
In fiscal year 2026-2027 and each fiscal year thereafter, the department shall calculate the number of crimes reported in accordance with the federal bureau of investigation's uniform crime reporting program national incident-based reporting system classification criteria.

E. Subsection D of this section applies only to the department of public safety forensics fund and may not be used in the distribution of other grants or monies.

F. For the purposes of this section, "full-service crime laboratory" means a laboratory that meets all of the following:

Is operated by a criminal justice agency of the state or a political subdivision.
Has at least one full-time forensic scientist who holds a minimum of a bachelor's degree in a physical or natural science.
Is registered as an analytical laboratory with the drug enforcement administration of the United States department of justice for the possession of all scheduled controlled substances.
Is accredited by an organization that provides accreditation based on the international laboratory accreditation cooperation G19 and standard ISO/IEC 17025 or standard ISO/IEC 17020 or any relevant field specific standards.
Provides a minimum of six forensic disciplines in the following areas, at least one of which must be DNA, digital forensics or drug toxicology:

(a) Trace evidence.

(b) Blood or breath alcohol.

(d) Crime scene processing.

(e) Latent print comparisons.

(f) Seized drugs.

(g) DNA.

(h) Digital forensics.

(i) Drug toxicology.

§ 41-1731 Peace officer training equipment fund; exemptions

A. The peace officer training equipment fund is established consisting of monies deposited pursuant to sections 12-114 and 12-116.10. The state treasurer shall administer the fund. Monies in the fund may be used only for peace officer equipment.

B. The state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. Monies in the fund:

Do not revert to the state general fund at the end of the fiscal year.
Are exempt from the provisions of section 35-190 relating to lapsing of appropriations.
Are subject to legislative appropriation.

§ 41-1732 Peace officer training equipment fund advisory commission; membership; duties; recommendations

A. The peace officer training equipment fund advisory commission is established consisting of the following members:

One member of the senate who is appointed by the president of the senate.
One member of the house of representatives who is appointed by the speaker of the house of representatives.
The director of the department of public safety or the director's designee.
One member who is appointed by the Arizona association of chiefs of police.
One member who is appointed by the Arizona sheriffs association.
One member who is appointed by the director of the Arizona state troopers association.
One member who is appointed by the director of the Arizona police association.

B. Members who are appointed pursuant to subsection A, paragraphs 4, 5, 6 and 7 of this section serve three-year terms. The members of the commission shall annually elect a chairperson and vice chairperson from among the voting members. The commission shall meet on the call of the chairperson but at least once each fiscal year. No actions may be taken without a quorum present. Members who are appointed pursuant to subsection A, paragraphs 1 and 2 of this section shall serve as advisory nonvoting members of the commission.

C. Members are not eligible to receive compensation but members who are appointed pursuant to subsection A, paragraphs 4, 5, 6 and 7 of this section are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

D. The advisory commission may use the facilities and the staff of the Arizona criminal justice commission.

E. The advisory commission may enter into interagency agreements with the Arizona criminal justice commission and other agencies for advisory commission business.

F. On or before December 1 of each year, the commission shall submit written recommendations to the president of the senate, the speaker of the house of representatives, the governor and the chairpersons of the senate commerce and public safety committee and the house of representatives judiciary and public safety committee, or their successor committees, on the allocation each fiscal year of monies in the peace officer training equipment fund established by section 41-1731. The commission shall provide a copy of the recommendations to the secretary of state.

§ 41-1733 School safety interoperability fund; school safety program; annual report

A. The school safety interoperability fund is established consisting of monies appropriated to the fund by the legislature. The department of administration shall administer the fund. Monies in the fund are continuously appropriated. Monies in the fund shall be distributed to the sheriff of a county or a city or town police department that establishes a school safety program and may be used only for a school safety program that meets all of the following:

Encompasses schools throughout this state.
In a school safety program county, enables the deployment of a secure, multimedia data communications system to a user base consisting of public safety agencies and public schools providing instruction in any combination of kindergarten programs and grades one through twelve.
Provides a communications solution environment that allows for:

(a) Identifying system users' identity, location and operational status during an incident.

(b) Secure text messaging and file sharing to all users involved in an incident.

(d) Integrating manually activated panic alarm systems that, when activated, establish direct collaboration between schools and public safety agencies.

(e) Using multiple forms of real-time communications and information collaboration, including voice and full-motion video sharing, during an incident.

Is capable of being deployed to end users on existing communications assets owned by participating entities.
Allows each participating entity to maintain discretionary real-time control of all communications assets owned or operated by the entity.
Encrypts all media communications.
Is certified under the United States department of homeland security safety act as qualified anti-terrorism technology.
Is compatible with the federal emergency management agency interoperable gateway system for disaster communications.
Ensures student and staff privacy.
Enables integration to school access control systems to allow remote lockdown by law enforcement through the same multimedia system.

B. On or before November 1 of each year, the sheriff of a county or a city or town police department that has established a school safety program pursuant to this section shall submit a report to the joint legislative budget committee of all expenditures made for the school safety program in the preceding fiscal year.

§ 41-1734 Video recordings; release; consent; redactions; request requirements; fee

A. The department may release to the public a copy of a video recording only if one or more of the following apply:

All persons other than peace officers shown in the video recording consent to the release, or any information that may identify persons shown in the video has been redacted. If a person shown in the video recording is deceased, the person's parent, guardian, next of kin or estate may provide the consent.
The department is the custodian of the video recording and reasonably determines that there is an important public purpose for releasing the video recording, including a situation in which the video recording involves any of the following:

(a) A person being arrested for a misdemeanor or felony with a sentence that may result in incarceration.

(b) One or more peace officers using physical force.

B. Before the department releases to the public a copy of a video recording, the department shall review the video recording to determine whether redacting or withholding the video recording is appropriate. The department:

Shall redact information that may identify persons shown in the video recording if a reasonable expectation of privacy exists unless the department obtains the consent of all persons required by subsection A, paragraph 1 of this section or the video recording involves an arrest described in subsection A, paragraph 2, subdivision (a) of this section. If the video recording involves an incident occurring in a public place, the department is not required to redact information that may identify persons who appear in the video recording only incidentally.
May withhold or redact a video recording if the department determines that the video recording is a public record and that privacy, confidentiality or the best interests of this state outweigh releasing or disclosing the video recording.
May withhold or redact a video recording if withholding or redacting the video recording is necessary to protect a victim's rights guaranteed under article II, section 2.1, Constitution of Arizona.

C. Notwithstanding title 39, chapter 1, article 2, the department shall deny a person's request for a copy of a video recording if the person fails to comply with the requirements of this section. The department may not release a copy of the video recording unless the person submits a written request that contains all of the following information:

The date and approximate time of the video recording.
The specific location where the video recording occurred.
The name of one or more persons known to be a subject of the video recording.

D. A person who makes a public records request to the department for a video recording but who fails to provide all of the information required in subsection C of this section may submit a subsequent request for the same video recording by providing all of the required information.

E. The department shall establish a fee that is charged to a person who submits a request for a copy of a video recording pursuant to this section. The department may take into consideration the following information when determining the amount of the fee:

The cost of reviewing, making a copy of and, as necessary, redacting the video recording.
The hourly compensation of a public records employee.
Any other relevant information.

§ 41-1735 Sexual assault kit evidence tracking system; definitions

A. The department shall establish a sexual assault kit evidence tracking system to track sexual assault kit evidence that is collected as prescribed in section 13-1426. A medical provider, law enforcement agency, public accredited crime laboratory or other person or entity that has custody or use of sexual assault kit evidence shall submit that information to the sexual assault kit evidence tracking system. The sexual assault kit evidence tracking system must:

Track the location and status of each sexual assault kit, including:

(a) The initial collection of evidence for the kit in a forensic medical examination.

(b) The receipt and storage of the kit at a law enforcement agency.

(d) The storage and destruction of the kit.

Allow a health care facility that performs a forensic medical examination of a victim, a law enforcement agency, a public accredited crime laboratory, a prosecutor or another entity that provides a chain of custody for sexual assault kit evidence to update and track the status and location of the kits.
Allow a victim to anonymously track and receive updates regarding the status and location of the victim's sexual assault kit evidence, with advance notification of destruction of the kit.

B. Sexual assault kit evidence records that are entered into the sexual assault kit evidence tracking system are confidential, except that the records may be accessed by:

The victim for whom the sexual assault kit evidence was completed.
An employee of an entity listed in subsection A of this section for the purposes of updating or tracking the status or location of the sexual assault kit evidence.

C. For the purposes of this section:

"Law enforcement agency" has the same meaning prescribed in section 13-1426.
"Public accredited crime laboratory" has the same meaning prescribed in section 13-1426.

§ 41-1736 Anti-human trafficking grant fund

The anti-human trafficking grant fund is established consisting of monies appropriated by the legislature. Monies in the fund are continuously appropriated. The department shall administer the fund and distribute monies from the fund to programs to reduce human trafficking in this state. To be eligible for grant monies, an anti-human trafficking program shall do either of the following:

Work to reduce human trafficking by providing assistance and analytical services to law enforcement agencies.
Provide services to victims and training to law enforcement agencies, prosecutorial agencies and the public on preventing and identifying human trafficking.

§ 41-1737 Transnational repression recognition and response training program

A. The department shall establish a transnational repression recognition and response training program to offer peace officers and other law enforcement officers specialized training. The department shall contract with an organization that has experience in developing and implementing transnational repression recognition and response training to develop the training curriculum. The department shall establish and oversee the process for selecting program participants and certifying program participants who successfully complete transnational repression recognition and response training. The training program shall be updated every year to address emerging threats and specific information on tactics that are used by specific foreign governments.

B. The training program shall include all of the following:

How to identify different tactics of transnational repression in physical and nonphysical forms.
Information on the governments that are known to employ transnational repression, including those governments that use transnational repression most frequently and those governments that use transnational repression most egregiously. The training shall include information on tools of digital surveillance and other cyber tools that are frequently used to carry out transnational repression activities.
Best practices for appropriate local and state law enforcement prevention, reporting and response tactics.
Information about communities that may be targeted by transnational repression and misinformation that may be perpetuated by foreign governments and foreign terrorist organizations.

C. The training program may not include any training on misinformation or promote the targeting of any person based on political or religious beliefs.

Article 3 Division of Arizona Highway Patrol

§ 41-1741 Arizona highway patrol; employees; authority; compensation

A. The department shall maintain a division known as the Arizona highway patrol.

B. The division shall be composed of a patrol superintendent, patrolmen, and clerical and technical assistants as designated by the director.

C. The patrol superintendent and patrolmen are vested with the authority of peace officers, primarily for the purpose of enforcing laws relating to the use of highways and operation of vehicles thereon.

D. The compensation of employees of the division shall be determined by the director, and shall, together with expenses of the division, be budgeted and paid from the state highway fund.

E. This division shall also consist of the following sections:

Communications.
Criminal identification.

§ 41-1742 Powers of the division

A. The highway patrol division superintendent may:

Adopt rules and regulations governing the policy, procedure and administration of all activities of the patrol.
Provide for training the patrolmen.
Cause signs to be erected and maintained as are necessary to give notice of any special restrictions.
Cooperate with the department of transportation and the Arizona department of agriculture in the enforcement of laws relating to motor vehicles.

B. The director of the department of transportation may grant authority to the highway patrol division superintendent to fix temporary speed limits or apply other temporary restrictions when emergency conditions exist. The director of the department of transportation may fix such speed limits, or apply such restrictions when congested traffic or other conditions require restrictions for public safety.

C. The division shall issue to each member of the patrol a badge of authority, with the words "Arizona highway patrol" encircling the badge, the seal of the state in the center thereof and with the designation of the office or rank of the holder below.

§ 41-1743 Duties of highway patrol

The highway patrol shall patrol the highways of the state, both day and night, and enforce the laws of the state. The highway patrol shall also investigate accidents which occur upon the highways, procure the names of drivers and descriptions and license numbers of the motor vehicles involved and transmit forthwith to the vehicle superintendent a copy of the report of the investigation.

§ 41-1743.01 Use in emergencies when ordered by governor; assistance to cities and counties

A. When the governor proclaims an emergency wherein he deems it necessary to protect life or property, he may order the Arizona highway patrol to provide whatever specific emergency services are necessary. The order directing the superintendent and the Arizona highway patrol shall state the specific purpose or purposes for which it is being utilized and the specific objectives to be accomplished.

B. If a county or municipality requires aid to protect life or property, there shall be submitted to the governor a request for such aid setting forth the particular object be accomplished and the area affected.

C. The authority granted in this section is supplemental to and is to be coordinated with the authority granted to the governor under section 26-172.

D. Upon approval by the governor, the highway patrol shall provide police security on or in the immediate vicinity of any state property at the request of the agency in need of such security. An agency in need of such security shall reimburse the highway patrol fund for the services of the personnel involved from such funds as may be available to such agency, and within the budget limitation of the Arizona highway patrol.

§ 41-1749 Communications section; duties

A. The communications section may install and operate all means of communications, including a police radio broadcasting system, which shall be best suited for the dissemination of information with regard to the apprehension of violators of the law and for the coordination of the activities and functions of the law enforcement agencies of the state, counties, cities or towns. It shall cooperate with county and municipal police authorities and with police radio stations in this state and in other states.

B. The communications section shall be responsible for the installation and operation of all computers and data processing equipment, and the design and development of all procedures and computer programs for information processing and tele-communications, to serve all divisions of the department.

C. The communications section shall provide for the rapid exchange of information, concerning the commission of crimes and the detection of violators of the law, between the law enforcement agencies of this state, its counties and municipalities and other states and the federal government.

§ 41-1750 Central state repository; department of public safety; duties; funds; accounts; definitions

A. The department is responsible for the effective operation of the central state repository in order to collect, store and disseminate complete and accurate Arizona criminal history records and related criminal justice information. The department may procure criminal history records and related criminal justice information for violations that are not listed in this section. The department shall:

Procure from all criminal justice agencies in this state accurate and complete personal identification data, fingerprints, charges, process control numbers and dispositions and such other information as may be pertinent to all persons who have been charged with, arrested for, convicted of or summoned to court as a criminal defendant for any of the following:

(a) A felony offense or an offense involving domestic violence as defined in section 13-3601.

(b) A violation of title 13, chapter 14 or title 28, chapter 4.

(i) Section 32-2422, subsection A, paragraph 4.

(ii) Section 32-2441, paragraph 4.

(iii) Section 32-2612, subsection A, paragraph 4.

(iv) Section 32-2622, subsection A, paragraph 4.

(v) Section 41-1758.03, subsections B and C.

(vi) Section 41-1758.07, subsections B and C.

Collect information concerning the number and nature of offenses known to have been committed in this state and of the legal steps taken in connection with these offenses, such other information that is useful in the study of crime and in the administration of criminal justice and all other information deemed necessary to operate the statewide uniform crime reporting program and to cooperate with the federal government uniform crime reporting program.
Collect information concerning criminal offenses that manifest evidence of prejudice based on race, color, religion, national origin, sexual orientation, gender, antisemitism or disability.
Cooperate with the central state repositories in other states and with the appropriate agency of the federal government in the exchange of information pertinent to violators of the law.
Ensure the rapid exchange of information concerning the commission of crime and the detection of violators of the law among the criminal justice agencies of other states and of the federal government.
Furnish assistance to peace officers throughout this state in crime scene investigation for the detection of latent fingerprints and in the comparison of latent fingerprints.
Conduct periodic operational audits of the central state repository and of a representative sample of other agencies that contribute records to or receive criminal justice information from the central state repository or through the Arizona criminal justice information system.
Establish and enforce the necessary physical and system safeguards to ensure that the criminal justice information maintained and disseminated by the central state repository or through the Arizona criminal justice information system is appropriately protected from unauthorized inquiry, modification, destruction or dissemination as required by this section.
Aid and encourage coordination and cooperation among criminal justice agencies through the statewide and interstate exchange of criminal justice information.
Provide training and proficiency testing on the use of criminal justice information to agencies receiving information from the central state repository or through the Arizona criminal justice information system.
Operate and maintain the Arizona automated fingerprint identification system established by section 41-2411.
Provide criminal history record information to the fingerprinting division for the purpose of screening applicants for fingerprint clearance cards.

B. The director may establish guidelines for the submission and retention of criminal justice information as deemed useful for the study or prevention of crime and for the administration of criminal justice.

C. Criminal justice agencies may provide criminal history records and related criminal justice information for violations that are not listed in this section. Except for the requirements listed in subsection U of this section, the chief officers of criminal justice agencies of this state or its political subdivisions shall provide to the central state repository fingerprints and information concerning personal identification data, descriptions, crimes for which persons are arrested, process control numbers and dispositions and such other information, including other biometric data, as may be pertinent to all persons who have been charged with, arrested for, convicted of or summoned to court as criminal defendants for any of the following:

Felony offenses or offenses involving domestic violence as defined in section 13-3601.
Violations of title 13, chapter 14 or title 28, chapter 4 that have occurred in this state.
An offense listed in:

(a) Section 32-2422, subsection A, paragraph 4.

(b) Section 32-2441, paragraph 4.

(d) Section 32-2622, subsection A, paragraph 4.

(e) Section 41-1758.03, subsections B and C.

(f) Section 41-1758.07, subsections B and C.

D. The chief officers of law enforcement agencies of this state or its political subdivisions shall provide to the department such information as necessary to operate the statewide uniform crime reporting program and to cooperate with the federal government uniform crime reporting program.

E. The chief officers of criminal justice agencies of this state or its political subdivisions shall comply with the training and proficiency testing guidelines as required by the department to comply with the federal national crime information center mandates.

F. The chief officers of criminal justice agencies of this state or its political subdivisions also shall provide to the department information concerning crimes that manifest evidence of prejudice based on race, color, religion, national origin, sexual orientation, gender, antisemitism or disability.

G. The director shall authorize the exchange of criminal justice information between the central state repository, or through the Arizona criminal justice information system, whether directly or through any intermediary, only as follows:

With criminal justice agencies of the federal government, Indian tribes, this state or its political subdivisions and other states, on request by the chief officers of such agencies or their designated representatives, specifically for the purposes of the administration of criminal justice and for evaluating the fitness of current and prospective criminal justice employees. Fingerprints submitted pursuant to this paragraph may be searched through the department and the federal bureau of investigation to conduct criminal history records checks. The department may conduct criminal history records checks through state and federal rap back services for the purpose of updating the status of current criminal justice employees or volunteers and may notify the criminal justice agency of the results of the records check. The department is authorized to submit fingerprints to the federal bureau of investigation to be retained for the purpose of being searched by future submissions to the federal bureau of investigation, including latent fingerprint searches. The department may retain fingerprints submitted pursuant to this paragraph for the purpose of being searched by future submissions to the department, including latent fingerprint searches.
With any noncriminal justice agency pursuant to a statute, ordinance or executive order that specifically authorizes the noncriminal justice agency to receive criminal history record information for the purpose of evaluating the fitness of current or prospective licensees, employees, contract employees or volunteers, on submission of the subject's fingerprints and the prescribed fee. Each statute, ordinance, or executive order that authorizes noncriminal justice agencies to receive criminal history record information for these purposes shall identify the specific categories of licensees, employees, contract employees or volunteers and shall require that fingerprints of the specified individuals be submitted in conjunction with such requests for criminal history record information. Fingerprints submitted pursuant to this paragraph may be searched through the department and the federal bureau of investigation to conduct criminal history records checks. The department may conduct criminal history records checks through state and federal rap back services for the purpose of updating the status of current licensees, employees, contract employees or volunteers and may notify the noncriminal justice agency of the results of the records check. The department is authorized to submit fingerprints to the federal bureau of investigation to be retained for the purpose of being searched by future submissions to the federal bureau of investigation, including latent fingerprint searches. The department is authorized to retain fingerprints submitted pursuant to this paragraph for the purpose of being searched by future submissions to the department, including latent fingerprint searches.
With the board of fingerprinting for the purpose of conducting good cause exceptions pursuant to section 41-619.55 and central registry exceptions pursuant to section 41-619.57.
With any individual for any lawful purpose on submission of the subject of record's fingerprints and the prescribed fee.
With the governor, if the governor elects to become actively involved in the investigation of criminal activity or the administration of criminal justice in accordance with the governor's constitutional duty to ensure that the laws are faithfully executed or as needed to carry out the other responsibilities of the governor's office.
With regional computer centers that maintain authorized computer-to-computer interfaces with the department, that are criminal justice agencies or under the management control of a criminal justice agency and that are established by a statute, ordinance or executive order to provide automated data processing services to criminal justice agencies specifically for the purposes of the administration of criminal justice or evaluating the fitness of regional computer center employees who have access to the Arizona criminal justice information system and the national crime information center system.
With an individual who asserts a belief that criminal history record information relating to the individual is maintained by an agency or in an information system in this state that is subject to this section. On submission of fingerprints, the individual may review this information for the purpose of determining its accuracy and completeness by making application to the agency operating the system. Rules adopted under this section shall include provisions for administrative review and necessary correction of any inaccurate or incomplete information. The review and challenge process authorized by this paragraph is limited to criminal history record information.
With individuals and agencies pursuant to a specific agreement with a criminal justice agency to provide services required for the administration of criminal justice pursuant to that agreement if the agreement specifically authorizes access to data, limits the use of data to purposes for which given and ensures the security and confidentiality of the data consistent with this section.
With individuals and agencies for the express purpose of research, evaluative or statistical activities pursuant to an agreement with a criminal justice agency if the agreement specifically authorizes access to data, limits the use of data to research, evaluative or statistical purposes and ensures the confidentiality and security of the data consistent with this section.
With the auditor general for audit purposes.
With central state repositories of other states for noncriminal justice purposes for dissemination in accordance with the laws of those states.
On submission of the fingerprint card, with the department of child safety and a tribal social services agency to provide criminal history record information on prospective adoptive parents for the purpose of conducting the preadoption certification investigation under title 8, chapter 1, article 1 if the department of economic security is conducting the investigation, or with an agency or a person appointed by the court, if the agency or person is conducting the investigation. Information received under this paragraph shall only be used for the purposes of the preadoption certification investigation.
With the department of child safety, a tribal social services agency and the superior court for the purpose of evaluating the fitness of custodians or prospective custodians of juveniles, including parents, relatives and prospective guardians. Information received under this paragraph shall only be used for the purposes of that evaluation. The information shall be provided on submission of either:

(a) The fingerprint card.

(b) The name, date of birth and social security number of the person.

On submission of a fingerprint card, provide criminal history record information to the superior court for the purpose of evaluating the fitness of investigators appointed under section 14-5303 or 14-5407, guardians appointed under section 14-5206 or 14-5304 or conservators appointed under section 14-5401.
With the supreme court to provide criminal history record information on prospective fiduciaries pursuant to section 14-5651.
With the department of juvenile corrections to provide criminal history record information pursuant to section 41-2814.
On submission of the fingerprint card, provide criminal history record information to the Arizona peace officer standards and training board or a board certified law enforcement academy to evaluate the fitness of prospective cadets.
With the internet sex offender website database established pursuant to section 13-3827.
With licensees of the United States nuclear regulatory commission for the purpose of determining whether an individual should be granted unescorted access to the protected area of a commercial nuclear generating station on submission of the subject of record's fingerprints and the prescribed fee.
With the state board of education for the purpose of evaluating the fitness of a certificated educator, an applicant for a teaching or administrative certificate or a noncertificated person as defined in section 15-505 if the state board of education or its employees or agents have reasonable suspicion that the educator or person engaged in conduct that would be a criminal violation of the laws of this state or was involved in immoral or unprofessional conduct or that the applicant engaged in conduct that would warrant disciplinary action if the applicant were certificated at the time of the alleged conduct. The information shall be provided on the submission of either:

(a) The fingerprint card.

(b) The name, date of birth and social security number of the person.

With each school district and charter school in this state. The department of education and the state board for charter schools shall provide the department of public safety with a current list of email addresses for each school district and charter school in this state and shall periodically provide the department of public safety with updated email addresses. If the department of public safety is notified that a person who is required to have a fingerprint clearance card to be employed by or to engage in volunteer activities at a school district or charter school has been arrested for or convicted of an offense listed in section 41-1758.03, subsection B or has been arrested for or convicted of an offense that amounts to unprofessional conduct under section 15-550, the department of public safety shall notify each school district and charter school in this state that the person's fingerprint clearance card has been suspended or revoked.
With a tribal social services agency and the department of child safety as provided by law, which currently is the Adam Walsh child protection and safety act of 2006 (42 United States Code section 16961), for the purposes of investigating or responding to reports of child abuse, neglect or exploitation. Information received pursuant to this paragraph from the national crime information center, the interstate identification index and the Arizona criminal justice information system network shall only be used for the purposes of investigating or responding as prescribed in this paragraph. The information shall be provided on submission to the department of public safety of either:

(a) The fingerprints of the person being investigated.

(b) The name, date of birth and social security number of the person.

With a nonprofit organization that interacts with children or vulnerable adults for the lawful purpose of evaluating the fitness of all current and prospective employees, contractors and volunteers of the organization. The criminal history record information shall be provided on submission of the applicant's fingerprint card and the prescribed fee. Fingerprints submitted pursuant to this paragraph may be searched by the department to conduct state criminal history records checks.
With the superior court for the purpose of determining an individual's eligibility for substance abuse and treatment courts in a family or juvenile case.
With the governor to provide criminal history record information on prospective gubernatorial nominees, appointees and employees as provided by law.

H. The director shall adopt rules necessary to execute this section.

I. The director, in the manner prescribed by law, shall remove and destroy records that the director determines are no longer of value in the detection or prevention of crime.

J. The director shall establish a fee in an amount necessary to cover the cost of federal noncriminal justice fingerprint processing for criminal history record information checks that are authorized by law for noncriminal justice employment, licensing or other lawful purposes. An additional fee may be charged by the department for state noncriminal justice fingerprint processing. Fees submitted to the department for state noncriminal justice fingerprint processing are not refundable.

K. The director shall establish a fee in an amount necessary to cover the cost of processing copies of department reports, eight by ten inch black and white photographs or eight by ten inch color photographs of traffic accident scenes.

L. Except as provided in subsection O of this section, each agency authorized by this section may charge a fee, in addition to any other fees prescribed by law, in an amount necessary to cover the cost of state and federal noncriminal justice fingerprint processing for criminal history record information checks that are authorized by law for noncriminal justice employment, licensing or other lawful purposes.

M. A fingerprint account within the records processing fund is established for the purpose of separately accounting for the collection and payment of fees for noncriminal justice fingerprint processing by the department. Monies collected for this purpose shall be credited to the account, and payments by the department to the United States for federal noncriminal justice fingerprint processing shall be charged against the account. Monies in the account not required for payment to the United States shall be used by the department in support of the department's noncriminal justice fingerprint processing duties. At the end of each fiscal year, any balance in the account not required for payment to the United States or to support the department's noncriminal justice fingerprint processing duties reverts to the state general fund.

N. A records processing fund is established for the purpose of separately accounting for the collection and payment of fees for department reports and photographs of traffic accident scenes processed by the department. Monies collected for this purpose shall be credited to the fund and shall be used by the department in support of functions related to providing copies of department reports and photographs. At the end of each fiscal year, any balance in the fund not required for support of the functions related to providing copies of department reports and photographs reverts to the state general fund.

O. The department of child safety may pay from appropriated monies the cost of federal fingerprint processing or federal criminal history record information checks that are authorized by law for employees and volunteers of the department, guardians pursuant to section 8-453, subsection A, paragraph 6, the licensing of foster parents or the certification of adoptive parents.

P. The director shall adopt rules that provide for:

The collection and disposition of fees pursuant to this section.
The refusal of service to those agencies that are delinquent in paying these fees.

Q. The director shall ensure that the following limitations are observed regarding dissemination of criminal justice information obtained from the central state repository or through the Arizona criminal justice information system:

Any criminal justice agency that obtains criminal justice information from the central state repository or through the Arizona criminal justice information system assumes responsibility for the security of the information and shall not secondarily disseminate this information to any individual or agency not authorized to receive this information directly from the central state repository or originating agency.
Dissemination to an authorized agency or individual may be accomplished by a criminal justice agency only if the dissemination is for criminal justice purposes in connection with the prescribed duties of the agency and not in violation of this section.
Criminal history record information disseminated to noncriminal justice agencies or to individuals shall be used only for the purposes for which it was given. Secondary dissemination is prohibited unless otherwise authorized by law.
The existence or nonexistence of criminal history record information shall not be confirmed to any individual or agency not authorized to receive the information itself.
Criminal history record information to be released for noncriminal justice purposes to agencies of other states shall only be released to the central state repositories of those states for dissemination in accordance with the laws of those states.
Criminal history record information shall be released to noncriminal justice agencies of the federal government pursuant to the terms of the federal security clearance information act (P.L. 99-169).

R. This section and the rules adopted under this section apply to all agencies and individuals collecting, storing or disseminating criminal justice information processed by manual or automated operations if the collection, storage or dissemination is funded in whole or in part with monies made available by the law enforcement assistance administration after July 1, 1973, pursuant to title I of the crime control act of 1973, and to all agencies that interact with or receive criminal justice information from or through the central state repository and through the Arizona criminal justice information system.

S. This section does not apply to criminal history record information contained in:

Posters, arrest warrants, announcements or lists for identifying or apprehending fugitives or wanted persons.
Original records of entry such as police blotters maintained by criminal justice agencies, compiled chronologically and required by law or long-standing custom to be made public if these records are organized on a chronological basis.
Transcripts or records of judicial proceedings if released by a court or legislative or administrative proceedings.
Announcements of executive clemency or pardon.
Computer databases, other than the Arizona criminal justice information system, that are specifically designed for community notification of an offender's presence in the community pursuant to section 13-3825 or for public informational purposes authorized by section 13-3827.

T. This section does not prevent a criminal justice agency from disclosing to the public criminal history record information that is reasonably contemporaneous to the event for which an individual is currently within the criminal justice system, including information noted on traffic accident reports concerning citations, blood alcohol tests or arrests made in connection with the traffic accident being investigated.

U. In order to ensure that complete and accurate criminal history record information is maintained and disseminated by the central state repository:

The booking agency shall take legible ten-print fingerprints of all persons who are arrested for offenses listed in subsection C of this section. The booking agency shall obtain a process control number and provide to the person fingerprinted a document that indicates proof of the fingerprinting and that informs the person that the document must be presented to the court.
Except as provided in paragraph 3 of this subsection, if a person is summoned to court as a result of an indictment or complaint for an offense listed in subsection C of this section, the court shall order the person to appear before the county sheriff and provide legible ten-print fingerprints. The county sheriff shall obtain a process control number and provide a document to the person fingerprinted that indicates proof of the fingerprinting and that informs the person that the document must be presented to the court. For the purposes of this paragraph, "summoned" includes a written promise to appear by the defendant on a uniform traffic ticket and complaint.
If a person is arrested for a misdemeanor offense listed in subsection C of this section by a city or town law enforcement agency, the person shall appear before the law enforcement agency that arrested the defendant and provide legible ten-print fingerprints. The law enforcement agency shall obtain a process control number and provide a document to the person fingerprinted that indicates proof of the fingerprinting and that informs the person that the document must be presented to the court.
The mandatory fingerprint compliance form shall contain the following information:

(a) Whether ten-print fingerprints have been obtained from the person.

(b) Whether a process control number was obtained.

(d) Any report number of the arresting authority.

(e) Instructions on reporting for ten-print fingerprinting, including available times and locations for reporting for ten-print fingerprinting.

(f) Instructions that direct the person to provide the form to the court at the person's next court appearance.

Within ten days after a person is fingerprinted, the arresting authority or agency that took the fingerprints shall forward the fingerprints to the department in the manner or form required by the department.
On the issuance of a summons for a defendant who is charged with an offense listed in subsection C of this section, the summons shall direct the defendant to provide ten-print fingerprints to the appropriate law enforcement agency.
At the initial appearance or on the arraignment of a summoned defendant who is charged with an offense listed in subsection C of this section, if the person does not present a completed mandatory fingerprint compliance form to the court or if the court has not received the process control number, the court shall order that within twenty calendar days the defendant be ten-print fingerprinted at a designated time and place by the appropriate law enforcement agency.
If the defendant fails to present a completed mandatory fingerprint compliance form or if the court has not received the process control number, the court, on its own motion, may remand the defendant into custody for ten-print fingerprinting. If otherwise eligible for release, the defendant shall be released from custody after being ten-print fingerprinted.
In every criminal case in which the defendant is incarcerated or fingerprinted as a result of the charge, an originating law enforcement agency or prosecutor, within forty days of the disposition, shall advise the central state repository of all dispositions concerning the termination of criminal proceedings against an individual arrested for an offense specified in subsection C of this section. This information shall be submitted on a form or in a manner required by the department.
Dispositions resulting from formal proceedings in a court having jurisdiction in a criminal action against an individual who is arrested for an offense specified in subsection C of this section or section 8-341, subsection Q, paragraph 3 shall be reported to the central state repository within forty days of the date of the disposition. This information shall be submitted on a form or in a manner specified by rules approved by the supreme court.
The state department of corrections or the department of juvenile corrections, within forty days, shall advise the central state repository that it has assumed supervision of a person convicted of an offense specified in subsection C of this section or section 8-341, subsection Q, paragraph 3. The state department of corrections or the department of juvenile corrections shall also report dispositions that occur thereafter to the central state repository within forty days of the date of the dispositions. This information shall be submitted on a form or in a manner required by the department of public safety.
Each criminal justice agency shall query the central state repository before dissemination of any criminal history record information to ensure the completeness of the information. Inquiries shall be made before any dissemination except in those cases in which time is of the essence and the repository is technically incapable of responding within the necessary time period. If time is of the essence, the inquiry shall still be made and the response shall be provided as soon as possible.

V. The director shall adopt rules specifying that any agency that collects, stores or disseminates criminal justice information that is subject to this section shall establish effective security measures to protect the information from unauthorized access, disclosure, modification or dissemination. The rules shall include reasonable safeguards to protect the affected information systems from fire, flood, wind, theft, sabotage or other natural or man-made hazards or disasters.

W. The department shall make available to agencies that contribute to, or receive criminal justice information from, the central state repository or through the Arizona criminal justice information system a continuing training program in the proper methods for collecting, storing and disseminating information in compliance with this section.

X. This section does not create a cause of action or a right to bring an action including an action based on discrimination due to sexual orientation.

Y. The definition prescribed in subsection Z, paragraph 3 of this section does not diminish or infringe on any rights protected under the first amendment to the United States constitution or the Arizona constitution.

Z. For the purposes of this section:

"Administration of criminal justice" means performance of the detection, apprehension, detention, pretrial release, posttrial release, prosecution, adjudication, correctional supervision or rehabilitation of criminal offenders. Administration of criminal justice includes enforcement of criminal traffic offenses and civil traffic violations, including parking violations, when performed by a criminal justice agency. Administration of criminal justice also includes criminal identification activities and the collection, storage and dissemination of criminal history record information.
"Administrative records" means records that contain adequate and proper documentation of the organization, functions, policies, decisions, procedures and essential transactions of the agency and that are designed to furnish information to protect the rights of this state and of persons directly affected by the agency's activities.
"Antisemitism" includes the definition of antisemitism that was adopted by the international holocaust remembrance alliance on May 26, 2016 and that has been adopted by the United States department of state, including the contemporary examples of antisemitism identified in the adopted definition.
"Arizona criminal justice information system" or "system" means the statewide information system managed by the director for the collection, processing, preservation, dissemination and exchange of criminal justice information and includes the electronic equipment, facilities, procedures and agreements necessary to exchange this information.
"Biometric data" means any physical characteristics, including fingerprints and palm prints and face, tattoo and iris images.
"Booking agency" means the county sheriff or, if a person is booked into a municipal jail, the municipal law enforcement agency.
"Central state repository" means the central location within the department for the collection, storage and dissemination of Arizona criminal history records and related criminal justice information.
"Criminal history record information" and "criminal history record" means information that is collected by criminal justice agencies on individuals and that consists of identifiable descriptions and notations of arrests, detentions, indictments and other formal criminal charges, and any disposition arising from those actions, sentencing, formal correctional supervisory action and release. Criminal history record information and criminal history record do not include identification information to the extent that the information does not indicate involvement of the individual in the criminal justice system or information relating to juveniles unless they have been adjudicated as adults.
"Criminal justice agency" means either:

(a) A court at any governmental level with criminal or equivalent jurisdiction, including courts of any foreign sovereignty duly recognized by the federal government.

(b) A government agency or subunit of a government agency that is specifically authorized to perform as its principal function the administration of criminal justice pursuant to a statute, ordinance or executive order and that allocates more than fifty percent of its annual budget to the administration of criminal justice. This subdivision includes agencies of any foreign sovereignty duly recognized by the federal government.

"Criminal justice information" means information that is collected by criminal justice agencies and that is needed for the performance of their legally authorized and required functions, such as criminal history record information, citation information, stolen property information, traffic accident reports, wanted persons information and system network log searches. Criminal justice information does not include the administrative records of a criminal justice agency.
"Disposition" means information disclosing that a decision has been made not to bring criminal charges or that criminal proceedings have been concluded or information relating to sentencing, correctional supervision, release from correctional supervision, the outcome of an appellate review of criminal proceedings or executive clemency.
"Dissemination" means the written, oral or electronic communication or transfer of criminal justice information to individuals and agencies other than the criminal justice agency that maintains the information. Dissemination includes the act of confirming the existence or nonexistence of criminal justice information.
"Management control":

(a) Means the authority to set and enforce:

(i) Priorities regarding development and operation of criminal justice information systems and programs.

(ii) Standards for the selection, supervision and termination of personnel involved in the development of criminal justice information systems and programs and in the collection, maintenance, analysis and dissemination of criminal justice information.

(iii) Policies governing the operation of computers, circuits and telecommunications terminals used to process criminal justice information to the extent that the equipment is used to process, store or transmit criminal justice information.

(b) Includes the supervision of equipment, systems design, programming and operating procedures necessary for the development and implementation of automated criminal justice information systems.

"Process control number" means the Arizona automated fingerprint identification system number that attaches to each arrest event at the time of fingerprinting and that is assigned to the arrest fingerprint card, disposition form and other pertinent documents.
"Rap back services" means real-time or near real-time notifications of activity, such as arrests on an individual, for authorized criminal justice or noncriminal justice purposes in which continuous evaluation of the individual's criminal history is required.
"Secondary dissemination" means the dissemination of criminal justice information from an individual or agency that originally obtained the information from the central state repository or through the Arizona criminal justice information system to another individual or agency.
"Sexual orientation" means consensual homosexuality or heterosexuality.
"Subject of record" means the person who is the primary subject of a criminal justice record.

§ 41-1750.01 National crime prevention and privacy compact

The contracting parties solemnly agree that:

This compact organizes an electronic information sharing system among the states and the federal government to exchange criminal history records for a variety of legally authorized noncriminal justice purposes, including background checks for governmental licensing and employment.
Under the compact, the FBI and the states agree to maintain detailed databases of their respective criminal history records, including arrests and dispositions, and to make them available to party states for authorized purposes. The FBI shall also manage the federal data facilities that provide a significant part of the infrastructure for the system.

Article 1

Definitions

As used in this compact:

"Administration of criminal justice" includes criminal identification activities and the collection, storage and dissemination of criminal history records.
"Compact officer" means, for the United States government, an official who is designated by the Director of the FBI and, for a party state, the chief administrator of the state's criminal history record repository or a designee who is a regular full-time employee of that repository.
"Criminal history record repository" means the state agency that is designated by the governor or other appropriate executive official or the legislature to perform centralized recordkeeping functions for criminal history records and services in the state.
"Criminal history records" means information that is collected by criminal justice agencies on individuals and that consists of identifiable descriptions and notations of arrests, detentions, indictments or other formal criminal charges, and any disposition arising therefrom, including acquittal, sentencing, correctional supervision or release. Criminal history records does not include identification information such as fingerprint records if the information does not indicate involvement of the individual with the criminal justice system.
"Criminal justice" includes detection, apprehension, detention, pretrial release, post-trial release, prosecution, adjudication, correctional supervision or rehabilitation of accused persons or criminal offenders.
"Criminal justice agency" means the courts, any governmental agency or any subunit of any governmental agency that performs the administration of criminal justice pursuant to a statute or executive order and that allocates a substantial part of its annual budget to the administration of criminal justice. Criminal justice agency includes state and federal inspector general offices.
"Criminal justice services" means services that are provided by the FBI to criminal justice agencies in response to a request for information about a particular individual or as an update to information that was previously provided for criminal justice purposes.
"Criterion offense" means any felony or misdemeanor offense that is not included on the list of nonserious offenses published periodically by the FBI.
"Direct access" means access to the national identification index by computer terminal or other automated means not requiring the assistance of or intervention by any other party or agency.
"Executive order" means an order of the president of the United States or the chief executive official of a state that has the force of law and that is adopted in accordance with applicable law.
"FBI" means the federal bureau of investigation.
"Interstate Identification Index System" or "III system" means the cooperative federal-state system for the exchange of criminal history records and includes the national identification index, the national fingerprint file and, to the extent of their participation in the system, the criminal history record repositories of the states and the FBI.
"National fingerprint file" means a database of fingerprints or other uniquely personal identifying information about an arrested or charged individual that is maintained by the FBI to provide positive identification of record subjects indexed in the III system.
"National identification index" means an index that is maintained by the FBI and that consists of names, identifying numbers and other descriptive information relating to record subjects about whom there are criminal history records in the III system.
"National indices" means the national identification index and the national fingerprint file.
"Non-compact or nonparty state" means a state that has not ratified the compact.
"Noncriminal justice purposes" means the use of criminal history records for crime prevention and other legitimate law enforcement purposes authorized by federal or state law including, but not limited to, employment suitability or licensing determinations, immigration and naturalization matters and national security clearances.
"Party state" or "compact state" means a state that has ratified the compact.
"Positive identification" means a determination, based on a comparison of fingerprints or other equally reliable biometric identification techniques, that the subject of a record search is the same person as the subject of a criminal history record or records indexed in the III system.
"Sealed record information" means:

(a) For adults, that portion of a record that is not available for criminal justice uses, not supported by fingerprints or other accepted means of positive identification or not subject to restrictions on dissemination for noncriminal justice purposes pursuant to a court order that is related to a particular subject or pursuant to a state or federal statute that requires action on a sealing petition filed by a particular record subject.

(b) For juveniles, whatever each state determines is a sealed record under its own law and procedure.

"State" means any state, territory or possession of the United States, the District of Columbia and the Commonwealth of Puerto Rico.

Article II

Purposes

The purposes of this compact are to:

Provide a legal framework for the establishment of a cooperative federal-state system for the interstate and federal-state exchange of criminal history records for noncriminal justice uses.
Require the FBI to permit use of the national identification index and the national fingerprint file by parties to this compact and to provide, in a timely fashion, federal and state criminal history records to requesting states, in accordance with the terms of this compact and with rules, procedures and standards that are established by the compact council under article VI of this compact.
Require party states to provide information and records for the national identification index and the national fingerprint file and to provide criminal history records, in a timely fashion, to criminal history record repositories of other states and the federal government for noncriminal justice purposes, in accordance with the terms of this compact and with rules, procedures and standards that are established by the compact council under article VI of this compact.
Provide for the establishment of a compact council to monitor III system operations and to promulgate system rules and procedures for the effective and proper operation of the III system for noncriminal justice purposes.
Require compact states to adhere to system standards concerning record dissemination and use, response times, system security, data quality and other duly established standards.

Article III

Responsibilities of Compact parties

A. The FBI has the following responsibilities:

The FBI director shall appoint an FBI compact officer who shall:

(a) Have responsibility for administering the provisions of this compact within the department of justice and the federal user community.

(b) Ensure that compact provisions and rules, procedures and standards that are established by the compact council under article VI of this compact are complied with in the federal user community.

(c) Regulate the use of records that are received by means of the III system from party states when such records are supplied by the FBI directly to other federal agencies.

The FBI shall:

(a) Provide to federal agencies and to state criminal history record repositories criminal history records that are maintained in its database for any noncriminal justice purposes described in article IV. These responses shall include information from non-compact states and from compact states relating to records for which such states have not assumed responsibility, to the extent that such data is maintained in FBI records.

(b) Provide a telecommunications network and maintain centralized facilities for the exchange of criminal history records for both criminal justice and noncriminal justice purposes described in article IV. The FBI shall ensure that the exchange of these records for criminal justice purposes has priority over the exchange of these records for noncriminal justice purposes.

(c) Modify or enter into user agreements with non-compact state criminal history record repositories to require them to establish record request procedures that conform to procedures prescribed in article V of this compact.

B. The states have the following responsibilities:

Each party state shall appoint a compact officer who shall:

(a) Have responsibility for administering the provisions of this compact within that state.

(b) Ensure that compact provisions and rules, procedures and standards that are established by the compact council under article VI are complied with in the state.

(c) Regulate the in-state use of records that are received by means of the III system from the FBI or from other party states.

Each party state's criminal history record repository shall:

(a) Provide information and records for the national identification index and the national fingerprint file.

(b) Provide the state's III system-indexed criminal history records for noncriminal justice purposes described in article IV.

Each party state shall:

(a) Participate in the national fingerprint file.

(b) Provide and maintain telecommunications links and related equipment that is necessary to support the services set forth in this compact.

C. In carrying out their responsibilities under the compact, party states and the FBI shall comply with system rules, procedures and standards that are established by the compact council concerning record dissemination and use, response times, data quality, system security and other aspects of system operation.

D. For the purposes of the maintenance of record services:

The use of the III system for noncriminal justice purposes authorized in this compact shall be managed so as not to diminish the level of services provided in support of criminal justice purposes.
The administration of compact provisions shall not reduce the level of services available to authorized noncriminal justice users on the effective date of this compact.

Article IV

Authorized Record Disclosures

A. To the extent authorized by the privacy act:

On request of a state criminal history record repository, the FBI shall provide criminal history records, including all unsealed federal criminal history records relating to criterion offenses for record subjects indexed in the III systems, for any noncriminal justice purpose that is allowed by federal statute or federal executive order or a state statute that has been approved by the United States attorney general and that authorizes national indices checks.
The FBI and state record repositories shall provide criminal history records, including all unsealed state criminal history record information relating to criterion offenses for record subjects indexed in the III system, to criminal justice agencies and other governmental or nongovernmental agencies for any noncriminal justice purposes that are allowed by federal statute or federal executive order or a state statute that has been approved by the United States attorney general and that authorizes national indices checks.

B. Records obtained under this compact may be used only for the official purposes for which they were requested. Compact officers shall establish procedures and measures, consistent with the provisions of this compact and with rules, procedures and standards that are established by the compact council under article VI, to ensure that records are used only by authorized officials for authorized purposes and to require that subsequent record checks are requested to obtain current information whenever a new need arises. These procedures must ensure that record entries that may not legally be used for a particular noncriminal justice purpose will be deleted from the response and, if no information authorized for release remains, an appropriate "no record" response will be communicated to the requesting official.

Article V

Record Request Procedures

A. Applicant fingerprints or other approved forms of positive identification shall be submitted with all requests for criminal history record checks for noncriminal justice purposes.

B. Requests for criminal history record checks that use the national indices and that are made under any approved state statute shall be submitted through that state's criminal history record repository. A state criminal history record repository shall process interstate requests for noncriminal justice purposes through the national indices only if the requests are transmitted through another state criminal history record repository or the FBI.

C. Requests for criminal history record checks that use the national indices and that are made under federal authority shall be submitted through the FBI or, if the repository consents to process fingerprint submissions, through the repository in the state in which the requests originated. Direct access to the national identification index by entities other than the FBI and state criminal history record repositories shall not be permitted for noncriminal justice purposes.

D. State criminal history record repositories and the FBI may charge fees for handling requests that involve fingerprint processing for noncriminal justice purposes, except that no fees shall be charged for providing criminal history records in response to an electronic request for a record that does not involve a request to process fingerprints.

E. If a state criminal history record repository cannot positively identify the subject of a record request made for noncriminal justice purposes, the request, together with fingerprints or other approved identifying information, shall be forwarded to the FBI for a search of the national indices. If the FBI positively identifies the subject as having a III system-indexed record or records, the FBI shall advise the state repository that submitted the request. The state repository shall then be entitled to obtain the additional criminal history record information from the FBI or other state repositories.

Article VI

Establishment of Compact Council

A. A compact council is established. The council shall promulgate rules and procedures governing the use of the III system for noncriminal justice purposes. The rules and procedures shall not conflict with FBI administration of the III system for criminal justice purposes. The council shall continue in existence so long as the compact remains in effect. For administrative purposes, the council shall be located within the FBI. The council shall be organized and its first meeting held as soon as practicable after the effective date of this compact.

B. The council consists of fifteen members who are appointed by the United States attorney general as follows:

Nine members who serve two year terms and who are selected from the duly designated compact officers of party states based on the recommendation of the compact officers of all party states. In the absence of the requisite number of compact officers available to serve, the chief administrators of the criminal history record repositories of non-compact states shall be eligible to serve on an interim basis.
Two at-large members who serve three year terms, one of whom represents federal criminal justice agencies and one of whom represents federal noncriminal justice agencies, and who are nominated by the director of the FBI.
Two at-large members who serve three year terms, one of whom represents state or local criminal justice agencies and one of whom represents state or local noncriminal justice agencies, and who are nominated by the compact council chairman.
One member who serves a three year term, who is simultaneously a member of the FBI's advisory policy board on criminal justice information services and who is nominated by the membership of this board.
One member who serves a three year term, who is simultaneously an employee of the FBI and who is nominated by the director of the FBI.

C. The chairman of the council shall be a member of and elected by the members of the council. The chairman shall be a compact officer unless there is no compact officer on the council who is willing to serve, in which case the chairman may be an at-large member. The chairman shall serve a two-year term and may be reelected to only one additional two-year term.

D. The council shall meet at least once each year. Meetings shall be open to the public. Appropriate prior public notices shall be provided.

E. The council shall have authority to request from the FBI any reports, studies, statistics or other information or materials as it finds necessary to enable it to perform its duties under this compact. The FBI, to the extent authorized by law, may provide such assistance or information.

F. The chairman may establish technical or other committees as necessary and may prescribe their membership, responsibilities and duration.

Article VII

Ratification of Compact

This compact becomes effective immediately on its execution by two or more states as between those states and the United States. On subsequent ratification of the compact by additional states, it shall become effective among these states and party states that have previously ratified the compact. When ratified, the compact has the full force and effect of law within the ratifying jurisdictions. The form of ratification shall be in accordance with the laws of the executing state.

Article VIII

Miscellaneous Provisions

A. Administration of the compact shall not interfere with the management and control of the director of the FBI over the FBI's collection and dissemination of criminal history records and the advisory function of the FBI's advisory policy board chartered under the federal advisory committee act for all purposes other than noncriminal justice.

B. Nothing in this compact requires the FBI to obligate or expend funds beyond its appropriations.

C. Nothing in this compact diminishes or lessens the obligations, responsibilities and authorities of any state, whether a compact state or a non-compact state, or of any criminal history record repository or other subdivision or component of any criminal history record repository under Public Law 92-544 or regulations and guidelines promulgated thereunder, including the III system standards that are referred to in article III(c) regarding the use and dissemination of criminal history records and information.

Article IX

Renunciation

This compact binds each party state until renounced by it. Renunciation of this compact shall be effected in the same manner by which a state ratified the compact. Renunciation shall become effective six months after written notice of renunciation is provided to all other parties.

Article X

Severability

The provisions of this compact are severable. If any phrase, clause, sentence or provision of this compact is declared to be contrary to the constitution of any participating state or of the United States or if the applicability of any phrase, clause, sentence or provisions of this compact to any government, agency, person or circumstance is held to be invalid, the validity of the remainder of this compact and the applicability of the remainder of this compact to any government, agency, person or circumstance shall not be affected. If a portion of this compact is declared to be contrary to the constitution of any party state, the compact shall remain in full force and effect as to the remaining party states and in full force and effect as to the affected party state as to all other provisions.

Article XI

Adjudication of Disputes

The compact council has original jurisdiction concerning this compact regarding interpretations of the compact or rules or standards established by the compact council pursuant to article V and disputes or controversies between parties to this compact. The council shall hold a hearing concerning the above at any regularly scheduled meeting and shall only render a decision based on a majority vote of its members. The FBI shall exercise immediate and necessary action to preserve the integrity of the III system, to maintain system policy and standards and to prevent abuses until the council holds a hearing on such matters. Parties may appeal the decisions of the compact council to the United States attorney general and finally to the appropriate United States district court, which shall have original jurisdiction of all cases or controversies arising under this compact. Any appeal so arising that is initiated in a state court shall be removed to the appropriate United States district court in the manner provided by 28 United States Code section 1446 or other statutory authority.

§ 41-1751 Reporting court dispositions to department of public safety

Every magistrate, or judge of a court, or clerk of a court of record who is responsible for court records in this state shall furnish to the department information pertaining to all court dispositions of felonies and misdemeanors, except traffic arrests, where incarceration or fingerprinting of the person occurred, including guilty pleas, convictions, acquittals, probations granted and pleas of guilty to reduced charges within forty days of the final disposition. Such information shall be submitted on a form and in accordance with rules approved by the supreme court of this state.

§ 41-1752 Arizona highway patrol fund

A. The Arizona highway patrol fund is established.

B. The Arizona highway patrol fund consists of:

Monies distributed to the fund from the Arizona highway user revenue fund by the legislature subject to section 28-6537.
Miscellaneous service fees.
Rewards.
Awards.
Insurance recoveries.
Receipts from the sale or disposal of any property held by the Arizona highway patrol or purchased with Arizona highway patrol monies.
Monies received from the public safety personnel retirement system pursuant to section 20-224.01.
Monies deposited pursuant to section 28-3513.
Monies deposited pursuant to section 28-2007.
Monies deposited pursuant to sections 28-2321, 28-2324, 28-2325, 28-5474, 28-5739, 28-5863 and 28-5864.

C. Subject to legislative appropriation, the patrol superintendent shall administer and spend monies in the Arizona highway patrol fund in conformity with the laws governing state financial operations.

D. Monies in the Arizona highway patrol fund:

Do not revert to the state general fund or Arizona highway user revenue fund.
Are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. Subject to legislative appropriation, monies in the Arizona highway patrol fund:

Shall be used for the following:

(a) Administering the provisions of law relating to the highway patrol and the Arizona highway patrol reserve and all matters pertaining to those laws, except that monies received pursuant to subsection B, paragraph 7 of this section shall be used for the department of public safety.

(b) The enforcement by the department of public safety and the department of transportation of vehicle safety requirements within twenty-five miles of the border between this state and Mexico.

(c) Costs related to procuring electronic equipment, automated systems or improvements to existing electronic equipment or automated systems for relieving vehicle congestion at ports of entry on the border between this state and Mexico.

(d) A commitment or investment necessary for the department or another agency of this state to obtain federal monies that are designated for expenditure pursuant to this section.

May be used for the pharmaceutical diversion and drug theft task force.

§ 41-1753 Limitation on number of highway patrol officers

There shall not be more than one highway patrol officer for each two thousand five hundred motor vehicles or fraction of that number of motor vehicles registered in this state during the preceding calendar year.

§ 41-1754 Impersonation of highway patrol or department of public safety officer; classification

A person is guilty of a class 1 misdemeanor who either:

Without authority, wears the badge of a member of the highway patrol or department of public safety or a badge of similar design that would tend to deceive.
Impersonates a member of the highway patrol or department of public safety with the intent to deceive.

§ 41-1755 Protection for governor

The director of the department of public safety shall provide transportation, security and protection for the governor and security and protection for the governor's family to the extent and in the manner the director of the department of public safety and the governor deem appropriate and adequate.

§ 41-1756 Unauthorized access to criminal history; classification; definitions

A. Except as provided by section 41-1750, a person commits unauthorized access to criminal history if the person intentionally, knowingly or recklessly does any of the following:

Permits unauthorized access to the Arizona criminal justice information system or to criminal history record information.
Uses the Arizona criminal justice information system or criminal history record information for a purpose other than as provided by section 41-1750.
Releases or procures the release of criminal history information.

B. A person who violates this section is guilty of a class 6 felony.

C. For the purposes of this section:

"Arizona criminal justice information system" has the same meaning prescribed in section 41-1750.
"Criminal history record information" has the same meaning prescribed in section 41-1750.

Article 3.1 Fingerprinting Division

§ 41-1758 Definitions

In this article, unless the context otherwise requires:

"Agency" means the supreme court, the department of economic security, the department of child safety, the department of education, the department of health services, the department of juvenile corrections, the department of emergency and military affairs, the department of public safety, the department of transportation, the state real estate department, the department of insurance and financial institutions, the board of fingerprinting, the Arizona game and fish department, the Arizona department of agriculture, the board of examiners of nursing care institution administrators and assisted living facility managers, the state board of dental examiners, the Arizona state board of pharmacy, the board of physical therapy, the state board of psychologist examiners, the board of athletic training, the board of occupational therapy examiners, the state board of podiatry examiners, the acupuncture board of examiners, the state board of technical registration, the board of massage therapy, the board of behavioral health examiners or the Arizona department of housing.
"Division" means the fingerprinting division in the department of public safety.
"Electronic or internet-based fingerprinting services" means a secure system for digitizing applicant fingerprints and transmitting the applicant data and fingerprints of a person or entity submitting fingerprints to the department of public safety for any authorized purpose under this title. For the purposes of this paragraph, "secure system" means a system that complies with the information technology security policy approved by the department of public safety.
"Good cause exception" means the issuance of a fingerprint clearance card to an applicant pursuant to section 41-619.55.
"Person" means a person who is required to be fingerprinted pursuant to any of the following:

(a) Section 3-314.

(b) Section 8-105.

(d) Section 8-463.

(e) Section 8-509.

(f) Section 8-802.

(g) Section 15-183.

(h) Section 15-503.

(i) Section 15-512.

(j) Section 15-534.

(k) Section 15-763.01.

(l) Section 15-782.02.

(m) Section 15-1330.

(n) Section 15-1881.

(o) Section 17-215.

(p) Section 28-3228.

(q) Section 28-3413.

(r) Section 32-122.02.

(s) Section 32-122.05.

(t) Section 32-122.06.

(u) Section 32-823.

(v) Section 32-1232.

(w) Section 32-1276.01.

(x) Section 32-1284.

(y) Section 32-1297.01.

(z) Section 32-1904.

(aa) Section 32-1941.

(bb) Section 32-1982.

(cc) Section 32-2022.

(dd) Section 32-2063.

(ee) Section 32-2108.01.

(ff) Section 32-2123.

(gg) Section 32-2371.

(hh) Section 32-3271.

(ii) Section 32-3430.

(jj) Section 32-3620.

(kk) Section 32-3668.

(ll) Section 32-3669.

(mm) Section 32-3922.

(nn) Section 32-3924.

(oo) Section 32-4128.

(pp) Section 32-4222.

(qq) Section 36-113.

(rr) Section 36-207.

(ss) Section 36-411.

(tt) Section 36-425.03.

(uu) Section 36-446.04.

(vv) Section 36-594.01.

(ww) Section 36-594.02.

(xx) Section 36-766.01.

(yy) Section 36-882.

(zz) Section 36-883.02.

(aaa) Section 36-897.01.

(bbb) Section 36-897.03.

(ccc) Section 36-1940.

(ddd) Section 36-1940.01.

(eee) Section 36-2069.

(fff) Section 36-3008.

(ggg) Section 41-619.52.

(hhh) Section 41-619.53.

(iii) Section 41-1964.

(jjj) Section 41-1967.01.

(kkk) Section 41-1968.

(lll) Section 41-1969.

(mmm) Section 41-2814.

(nnn) Section 41-4025.

(ooo) Section 46-141, subsection A or B.

(ppp) Section 46-321.

"Rap back services" has the same meaning prescribed in section 41-1750.
"Vulnerable adult" has the same meaning prescribed in section 13-3623.

§ 41-1758.01 Fingerprinting division; powers and duties

A. The fingerprinting division is established in the department of public safety and shall:

Conduct fingerprint background checks for persons and applicants who are seeking licenses from state agencies, employment with licensees, contract providers and state agencies or employment or educational opportunities with agencies that require fingerprint background checks pursuant to sections 3-314, 8-105, 8-322, 8-463, 8-509, 8-802, 15-183, 15-503, 15-512, 15-534, 15-763.01, 15-782.02, 15-1330, 15-1881, 17-215, 28-3228, 28-3413, 32-122.02, 32-122.05, 32-122.06, 32-823, 32-1232, 32-1276.01, 32-1284, 32-1297.01, 32-1904, 32-1941, 32-1982, 32-2022, 32-2063, 32-2108.01, 32-2123, 32-2371, 32-3271, 32-3430, 32-3620, 32-3668, 32-3669, 32-3922, 32-3924, 32-4128, 32-4222, 36-113, 36-207, 36-411, 36-425.03, 36-446.04, 36-594.01, 36-594.02, 36-766.01, 36-882, 36-883.02, 36-897.01, 36-897.03, 36-1940, 36-1940.01, 36-2069, 36-3008, 41-619.52, 41-619.53, 41-1964, 41-1967.01, 41-1968, 41-1969, 41-2814 and 41-4025, section 46-141, subsection A or B and section 46-321.
Issue fingerprint clearance cards. On issuance, a fingerprint clearance card becomes the personal property of the cardholder and the cardholder shall retain possession of the fingerprint clearance card.
On submission of an application for a fingerprint clearance card, collect the fees established by the board of fingerprinting pursuant to section 41-619.53 and deposit, pursuant to sections 35-146 and 35-147, the monies collected in the board of fingerprinting fund.
Inform in writing each person who submits fingerprints for a fingerprint background check of the right to petition the board of fingerprinting for a good cause exception pursuant to section 41-1758.03, 41-1758.04 or 41-1758.07.
If after conducting a state and federal criminal history records check the division determines that it is not authorized to issue a fingerprint clearance card to a person, inform the person in writing that the division is not authorized to issue a fingerprint clearance card. The notice shall include the criminal history information on which the denial was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.
Notify the person in writing if the division suspends, revokes or places a driving restriction notation on a fingerprint clearance card pursuant to section 41-1758.04. The notice shall include the criminal history information on which the suspension, revocation or placement of the driving restriction notation was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.
Administer and enforce this article.

B. The fingerprinting division may contract for electronic or internet-based fingerprinting services through an entity or entities for the acquisition and transmission of applicant fingerprint and data submissions to the department, including identity verified fingerprints pursuant to section 15-106. The entity or entities contracted by the department of public safety may charge the applicant a fee for services provided pursuant to this article. The entity or entities contracted by the department of public safety shall comply with:

All information privacy and security measures and submission standards established by the department of public safety.
The information technology security policy approved by the department of public safety.

§ 41-1758.02 Fingerprint checks; registration

A. The person, provider or agency shall submit a full set of fingerprints to the division for the purpose of obtaining a state and federal criminal history records check pursuant to section 41-1750 and Public Law 92-544. If the person can present a valid fingerprint clearance card or credible documentation that the person's application for a fingerprint clearance card is pending, the person, provider or agency is not required to submit another application for a fingerprint clearance card. The division may exchange this fingerprint data with the federal bureau of investigation.

B. Except as provided in section 15-106, paragraph 9, the person shall submit a new set of fingerprints to the division for a fingerprint background check every six years. The division shall conduct a new state and federal criminal history records check on application for a new card.

C. In order to apply for a fingerprint clearance card, a person shall submit a completed application for a fingerprint clearance card provided by the division.

D. The person, provider or agency shall submit the application required by subsection C of this section along with the fingerprints and applicable fee to the division for a criminal history records check.

§ 41-1758.03 Fingerprint clearance cards; issuance; immunity

A. On receiving the state and federal criminal history record of a person, the division shall compare the record with the list of criminal offenses that preclude the person from receiving a fingerprint clearance card. If the person's criminal history record does not contain any of the offenses listed in subsections B and C of this section, the division shall issue the person a fingerprint clearance card.

B. A person who is subject to registration as a sex offender in this state or any other jurisdiction or who is awaiting trial on or who has been convicted of committing or attempting, soliciting, facilitating or conspiring to commit one or more of the following offenses in this state or the same or similar offenses in another state or jurisdiction is precluded from receiving a fingerprint clearance card pursuant to this section:

Sexual abuse of a vulnerable adult.
Incest.
First or second degree murder.
Sexual assault.
Sexual exploitation of a minor.
Sexual exploitation of a vulnerable adult.
Commercial sexual exploitation of a minor.
Commercial sexual exploitation of a vulnerable adult.
Child sex trafficking as prescribed in section 13-3212.
Child abuse.
Abuse of a vulnerable adult.
Sexual conduct with a minor.
Molestation of a child.
Molestation of a vulnerable adult.
A dangerous crime against children as defined in section 13-705.
Exploitation of minors involving drug offenses.
Taking a child for the purpose of prostitution as prescribed in section 13-3206.
Neglect or abuse of a vulnerable adult.
Sex trafficking.
Sexual abuse.
Production, publication, sale, possession and presentation of obscene items as prescribed in section 13-3502.
Furnishing harmful items to minors as prescribed in section 13-3506.
Furnishing harmful items to minors by internet activity as prescribed in section 13-3506.01.
Obscene or indecent telephone communications to minors for commercial purposes as prescribed in section 13-3512.
Luring a minor for sexual exploitation.
Enticement of persons for purposes of prostitution.
Procurement by false pretenses of person for purposes of prostitution.
Procuring or placing persons in a house of prostitution.
Receiving earnings of a prostitute.
Causing one's spouse to become a prostitute.
Detention of persons in a house of prostitution for debt.
Keeping or residing in a house of prostitution or employment in prostitution.
Pandering.
Transporting persons for the purpose of prostitution, polygamy and concubinage.
Portraying adult as a minor as prescribed in section 13-3555.
Admitting minors to public displays of sexual conduct as prescribed in section 13-3558.
Unlawful sale or purchase of children.
Child bigamy.
Trafficking of persons for forced labor or services.

C. A person who is awaiting trial on or who has been convicted of committing or attempting, soliciting, facilitating or conspiring to commit one or more of the following offenses in this state or the same or similar offenses in another state or jurisdiction is precluded from receiving a fingerprint clearance card, except that the person may petition the board of fingerprinting for a good cause exception pursuant to section 41-619.55:

Manslaughter.
Endangerment.
Threatening or intimidating.
Assault.
Unlawfully administering intoxicating liquors, narcotic drugs or dangerous drugs.
Assault by vicious animals.
Drive by shooting.
Assaults on officers or firefighters.
Discharging a firearm at a structure.
Indecent exposure.
Public sexual indecency.
Aggravated criminal damage.
Theft.
Theft by extortion.
Shoplifting.
Forgery.
Criminal possession of a forgery device.
Obtaining a signature by deception.
Criminal impersonation.
Theft of a credit card or obtaining a credit card by fraudulent means.
Receipt of anything of value obtained by fraudulent use of a credit card.
Forgery of a credit card.
Fraudulent use of a credit card.
Possession of any machinery, plate or other contrivance or incomplete credit card.
False statement as to financial condition or identity to obtain a credit card.
Fraud by persons authorized to provide goods or services.
Credit card transaction record theft.
Misconduct involving weapons.
Misconduct involving explosives.
Depositing explosives.
Misconduct involving simulated explosive devices.
Concealed weapon violation.
Possession and sale of peyote.
Possession and sale of a vapor-releasing substance containing a toxic substance.
Sale of precursor chemicals.
Possession, use or sale of marijuana, dangerous drugs or narcotic drugs.
Manufacture or distribution of an imitation controlled substance.
Manufacture or distribution of an imitation prescription-only drug.
Manufacture or distribution of an imitation over-the-counter drug.
Possession or possession with intent to use an imitation controlled substance.
Possession or possession with intent to use an imitation prescription-only drug.
Possession or possession with intent to use an imitation over-the-counter drug.
Manufacture of certain substances and drugs by certain means.
Adding poison or other harmful substance to food, drink or medicine.
A criminal offense involving criminal trespass under title 13, chapter 15.
A criminal offense involving burglary under title 13, chapter 15.
A criminal offense under title 13, chapter 23.
Child neglect.
Misdemeanor offenses involving contributing to the delinquency of a minor.
Offenses involving domestic violence.
Arson.
Kidnapping.
Felony offenses involving sale, distribution or transportation of, offer to sell, transport or distribute or conspiracy to sell, transport or distribute marijuana, dangerous drugs or narcotic drugs.
Robbery.
Aggravated assault.
Felony offenses involving contributing to the delinquency of a minor.
Negligent homicide.
Criminal damage.
Misappropriation of charter school monies as prescribed in section 13-1818.
Taking identity of another person or entity.
Aggravated taking identity of another person or entity.
Trafficking in the identity of another person or entity.
Cruelty to animals.
Prostitution.
Sale or distribution of material harmful to minors through vending machines as prescribed in section 13-3513.
Welfare fraud.

D. A person who is awaiting trial on or who has been convicted of committing or attempting to commit a misdemeanor or felony violation of section 28-1381, 28-1382 or 28-1383 in this state or the same or similar offense in another state or jurisdiction within five years after the date of applying for a fingerprint clearance card is precluded from driving any vehicle to transport employees or clients of the employing agency as part of the person's employment. The division shall place a notation on the fingerprint clearance card that indicates this driving restriction. This subsection does not preclude a person from driving a vehicle alone as part of the person's employment. This subsection does not apply to a person who is licensed pursuant to title 32, chapter 20, except if the person is employed by an agency as defined in section 41-1758.

E. Notwithstanding subsection C of this section, on receiving written notice from the board of fingerprinting that a good cause exception was granted pursuant to section 41-619.55, the division shall issue a fingerprint clearance card to the person.

F. If the division denies a person's application for a fingerprint clearance card pursuant to subsection C of this section and a good cause exception is requested pursuant to section 41-619.55, the division shall release, on request by the board of fingerprinting, the person's criminal history record to the board of fingerprinting.

G. A person shall be granted a fingerprint clearance card if either of the following applies:

An agency granted a good cause exception before August 16, 1999 and no new precluding offense is identified. The fingerprint clearance card shall specify only the program that granted the good cause exception. On the request of the applicant, the agency that granted the prior good cause exception shall notify the division in writing of the date on which the prior good cause exception was granted and the date of the conviction and the name of the offense for which the good cause exception was granted.
The board granted a good cause exception and no new precluding offense is identified.

H. The licensee or contract provider shall assume the costs of fingerprint checks and may charge these costs to persons who are required to be fingerprinted.

I. A person who is under eighteen years of age or who is at least ninety-nine years of age is exempt from the fingerprint clearance card requirements of this section. At all times the person shall be under the direct visual supervision of personnel who have valid fingerprint clearance cards.

J. The division may conduct criminal history records checks through state and federal rap back services pursuant to section 41-1750, subsection G for the purpose of updating the clearance status of current fingerprint clearance card holders and may notify the agency employing the person or the licensing agency of the results of the records check. If the division suspends a person's fingerprint clearance card and the person requests a good cause exception pursuant to section 41-619.55, the division shall release, on request by the board of fingerprinting, the person's criminal history record to the board of fingerprinting.

K. The division shall revoke a person's fingerprint clearance card on receipt of a written request for revocation from the board of fingerprinting pursuant to section 41-619.55.

L. If a person's criminal history record contains an offense listed in subsection B or C of this section and the final disposition is not recorded on the record, the division shall conduct research to obtain the disposition within thirty business days after receipt of the record. If the division cannot determine, within thirty business days after receipt of the person's state and federal criminal history record information, whether the person is awaiting trial on or has been convicted of committing or attempting, soliciting, facilitating or conspiring to commit any of the offenses listed in subsection B or C of this section in this state or the same or a similar offense in another state or jurisdiction, the division shall not issue a fingerprint clearance card to the person. If the division is unable to make the determination required by this subsection and does not issue a fingerprint clearance card to a person, the person may request a good cause exception pursuant to section 41-619.55.

M. Except as provided in subsection N of this section, if after conducting a state and federal criminal history records check the division determines that it is not authorized to issue a fingerprint clearance card to a person, the division shall notify the agency that licenses or employs the person that the division is not authorized to issue a fingerprint clearance card. This notice shall include the criminal history information on which the denial was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.

N. If, after conducting a state and federal criminal history records check on a person who requests a fingerprint clearance card pursuant to section 15-1881, the division determines that it is not authorized to issue a fingerprint clearance card to the person, the division shall not notify the agency. The division shall notify the person who requested the card that the division is not authorized to issue a fingerprint clearance card. The notice shall include the criminal history information on which the denial was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.

O. The division is not liable for damages resulting from:

The issuance of a fingerprint clearance card to a person who is later found to have been ineligible to receive a fingerprint clearance card at the time the card was issued.
The denial of a fingerprint clearance card to a person who is later found to have been eligible to receive a fingerprint clearance card at the time issuance of the card was denied.

P. The issuance of a fingerprint clearance card does not entitle a person to employment.

Q. Notwithstanding any law to the contrary, a person may apply for and receive a level I fingerprint clearance card pursuant to section 41-1758.07 to satisfy a requirement that the person have a valid fingerprint clearance card issued pursuant to this section.

§ 41-1758.04 Denial, suspension or revocation of fingerprint clearance card; driving restricted notation

A. The division shall deny the issuance of a fingerprint clearance card to any person who is awaiting trial on or who has been convicted of an offense listed in section 41-1758.03, subsection B or C or section 41-1758.07, subsection B or C. The division shall deny the issuance of a fingerprint clearance card if required pursuant to section 41-1758.03, subsection L or section 41-1758.07, subsection L.

B. The division shall revoke the fingerprint clearance card of a person who has received a fingerprint clearance card and who is subsequently convicted of an offense listed in section 41-1758.03, subsection B or section 41-1758.07, subsection B.

C. The division shall suspend the fingerprint clearance card of a person who becomes subject to registration as a sex offender or a person who is arrested for an offense listed in section 41-1758.03, subsection B or C or section 41-1758.07, subsection B or C.

D. A person who has been arrested for an offense listed in section 41-1758.03, subsection C or section 41-1758.07, subsection C and whose fingerprint clearance card has been suspended pursuant to this section may request a good cause exception hearing pursuant to section 41-619.55.

E. The division shall place a driving restriction notation on the fingerprint clearance card of a person who is subsequently arrested for an offense listed in section 41-1758.03, subsection D or section 41-1758.07, subsection D.

F. The division shall notify the agency and person in writing if the division suspends, revokes or places a driving restriction notation on a person's fingerprint clearance card pursuant to this section. The notice shall include the criminal history information on which the suspension, revocation or placement of the driving restriction was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.

§ 41-1758.05 Violation; classification

A person who knowingly falsifies a material fact or who makes or uses a false fingerprint clearance card knowing the false fingerprint clearance card contains a false, fictitious or fraudulent statement is guilty of a class 3 misdemeanor.

§ 41-1758.06 Fingerprint clearance card fund; exemption

A. The fingerprint clearance card fund is established consisting of fees collected from applicants or contract providers for a fingerprint clearance card. The department shall administer the fund. Monies in the fund are subject to legislative appropriation. The department may use any appropriated monies from the fund for the expenses of the department's crime laboratory and real property use. Any monies remaining in the fund in excess of the monies appropriated from the fund each fiscal year are continuously appropriated to the department for the costs of the fingerprinting division.

B. Monies deposited in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-1758.07 Level I fingerprint clearance cards; definitions

A. On receiving the state and federal criminal history record of a person who is required to be fingerprinted pursuant to this section, the division shall compare the record with the list of criminal offenses that preclude the person from receiving a level I fingerprint clearance card. If the person's criminal history record does not contain any of the offenses listed in subsections B and C of this section, the division shall issue the person a level I fingerprint clearance card.

Sexual abuse of a vulnerable adult.
Incest.
Homicide, including first or second degree murder, manslaughter and negligent homicide.
Sexual assault.
Sexual exploitation of a minor.
Sexual exploitation of a vulnerable adult.
Commercial sexual exploitation of a minor.
Commercial sexual exploitation of a vulnerable adult.
Child sex trafficking as prescribed in section 13-3212.
Child abuse.
Felony child neglect.
Abuse of a vulnerable adult.
Sexual conduct with a minor.
Molestation of a child.
Molestation of a vulnerable adult.
Dangerous crimes against children as defined in section 13-705.
Exploitation of minors involving drug offenses.
Taking a child for the purpose of prostitution as prescribed in section 13-3206.
Neglect or abuse of a vulnerable adult.
Sex trafficking.
Sexual abuse.
Production, publication, sale, possession and presentation of obscene items as prescribed in section 13-3502.
Furnishing harmful items to minors as prescribed in section 13-3506.
Furnishing harmful items to minors by internet activity as prescribed in section 13-3506.01.
Obscene or indecent telephone communications to minors for commercial purposes as prescribed in section 13-3512.
Luring a minor for sexual exploitation.
Enticement of persons for purposes of prostitution.
Procurement by false pretenses of person for purposes of prostitution.
Procuring or placing persons in a house of prostitution.
Receiving earnings of a prostitute.
Causing one's spouse to become a prostitute.
Detention of persons in a house of prostitution for debt.
Keeping or residing in a house of prostitution or employment in prostitution.
Pandering.
Transporting persons for the purpose of prostitution, polygamy and concubinage.
Portraying adult as a minor as prescribed in section 13-3555.
Admitting minors to public displays of sexual conduct as prescribed in section 13-3558.
Any felony offense involving contributing to the delinquency of a minor.
Unlawful sale or purchase of children.
Child bigamy.
Any felony offense involving domestic violence as defined in section 13-3601 except for a felony offense only involving criminal damage in an amount of more than $250 but less than $1,000 if the offense was committed before June 29, 2009.
Any felony offense in violation of title 13, chapter 12 if committed within five years before the date of applying for a level I fingerprint clearance card.
Felony drug or alcohol related offenses if committed within five years before the date of applying for a level I fingerprint clearance card.
Felony indecent exposure.
Felony public sexual indecency.
Terrorism.
Any offense involving a violent crime as defined in section 13-901.03.
Trafficking of persons for forced labor or services.

C. A person who is awaiting trial on or who has been convicted of committing or attempting, soliciting, facilitating or conspiring to commit one or more of the following offenses in this state or the same or similar offenses in another state or jurisdiction is precluded from receiving a level I fingerprint clearance card, except that the person may petition the board of fingerprinting for a good cause exception pursuant to section 41-619.55:

Any misdemeanor offense in violation of title 13, chapter 12.
Misdemeanor indecent exposure.
Misdemeanor public sexual indecency.
Aggravated criminal damage.
Theft.
Theft by extortion.
Shoplifting.
Forgery.
Criminal possession of a forgery device.
Obtaining a signature by deception.
Criminal impersonation.
Theft of a credit card or obtaining a credit card by fraudulent means.
Receipt of anything of value obtained by fraudulent use of a credit card.
Forgery of a credit card.
Fraudulent use of a credit card.
Possession of any machinery, plate or other contrivance or incomplete credit card.
False statement as to financial condition or identity to obtain a credit card.
Fraud by persons authorized to provide goods or services.
Credit card transaction record theft.
Misconduct involving weapons.
Misconduct involving explosives.
Depositing explosives.
Misconduct involving simulated explosive devices.
Concealed weapon violation.
Misdemeanor possession and misdemeanor sale of peyote.
Felony possession and felony sale of peyote if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor possession and misdemeanor sale of a vapor-releasing substance containing a toxic substance.
Felony possession and felony sale of a vapor-releasing substance containing a toxic substance if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor sale of precursor chemicals.
Felony sale of precursor chemicals if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor possession, misdemeanor use or misdemeanor sale of marijuana, dangerous drugs or narcotic drugs.
Felony possession, felony use or felony sale of marijuana, dangerous drugs or narcotic drugs if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor manufacture or misdemeanor distribution of an imitation controlled substance.
Felony manufacture or felony distribution of an imitation controlled substance if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor manufacture or misdemeanor distribution of an imitation prescription-only drug.
Felony manufacture or felony distribution of an imitation prescription-only drug if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor manufacture or misdemeanor distribution of an imitation over-the-counter drug.
Felony manufacture or felony distribution of an imitation over-the-counter drug if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor possession or misdemeanor possession with intent to use an imitation controlled substance.
Felony possession or felony possession with intent to use an imitation controlled substance if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor possession or misdemeanor possession with intent to use an imitation prescription-only drug.
Felony possession or felony possession with intent to use an imitation prescription-only drug if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor possession or misdemeanor possession with intent to use an imitation over-the-counter drug.
Felony possession or felony possession with intent to use an imitation over-the-counter drug if committed more than five years before the date of applying for a level I fingerprint clearance card.
Misdemeanor manufacture of certain substances and drugs by certain means.
Felony manufacture of certain substances and drugs by certain means if committed more than five years before the date of applying for a level I fingerprint clearance card.
Adding poison or other harmful substance to food, drink or medicine.
A criminal offense involving criminal trespass under title 13, chapter 15.
A criminal offense involving burglary under title 13, chapter 15.
A criminal offense under title 13, chapter 23, except terrorism.
Misdemeanor offenses involving child neglect.
Misdemeanor offenses involving contributing to the delinquency of a minor.
Misdemeanor offenses involving domestic violence as defined in section 13-3601.
Felony offenses involving domestic violence if the offense only involved criminal damage in an amount of more than $250 but less than $1,000 and the offense was committed before June 29, 2009.
Arson.
Felony offenses involving sale, distribution or transportation of, offer to sell, transport or distribute or conspiracy to sell, transport or distribute marijuana, dangerous drugs or narcotic drugs if committed more than five years before the date of applying for a level I fingerprint clearance card.
Criminal damage.
Misappropriation of charter school monies as prescribed in section 13-1818.
Taking identity of another person or entity.
Aggravated taking identity of another person or entity.
Trafficking in the identity of another person or entity.
Cruelty to animals.
Prostitution as prescribed in section 13-3214.
Sale or distribution of material harmful to minors through vending machines as prescribed in section 13-3513.
Welfare fraud.
Any felony offense in violation of title 13, chapter 12 if committed more than five years before the date of applying for a level I fingerprint clearance card.
Kidnapping.
Robbery, aggravated robbery or armed robbery.

D. A person who is awaiting trial on or who has been convicted of committing or attempting to commit a misdemeanor violation of section 28-1381, 28-1382 or 28-1383 in this state or the same or a similar offense in another state or jurisdiction within five years after the date of applying for a level I fingerprint clearance card is precluded from driving any vehicle to transport employees or clients of the employing agency as part of the person's employment. The division shall place a notation on the level I fingerprint clearance card that indicates this driving restriction. This subsection does not preclude a person from driving a vehicle alone as part of the person's employment.

F. If the division denies a person's application for a level I fingerprint clearance card pursuant to subsection C of this section and a good cause exception is requested pursuant to section 41-619.55, the division shall release, on request by the board of fingerprinting, the person's criminal history record to the board of fingerprinting.

G. A person shall be granted a level I fingerprint clearance card pursuant to this section if either of the following applies:

An agency granted a good cause exception before August 16, 1999 and no new precluding offense is identified. The fingerprint clearance card shall specify only the program that granted the good cause exception. On the request of the applicant, the agency that granted the prior good cause exception shall notify the division in writing of the date on which the prior good cause exception was granted, the date of the conviction and the name of the offense for which the good cause exception was granted.
The board granted a good cause exception and no new precluding offense is identified.

H. The licensee or contract provider shall assume the costs of fingerprint checks conducted pursuant to this section and may charge these costs to persons who are required to be fingerprinted.

I. A person who is under eighteen years of age or who is at least ninety-nine years of age is exempt from the level I fingerprint clearance card requirements of this section. At all times the person shall be under the direct visual supervision of personnel who have valid level I fingerprint clearance cards.

J. The division may conduct criminal history records checks through state and federal rap back services pursuant to section 41-1750, subsection G for the purpose of updating the clearance status of current level I fingerprint clearance cardholders pursuant to this section and may notify the employing or licensing agency of the results of the records check. If the division suspends a person's fingerprint clearance card and the person requests a good cause exception pursuant to section 41-619.55, the division shall release, on request by the board of fingerprinting, the person's criminal history record to the board of fingerprinting.

K. The division shall revoke a person's level I fingerprint clearance card on receipt of a written request for revocation from the board of fingerprinting pursuant to section 41-619.55.

L. If a person's criminal history record contains an offense listed in subsection B or C of this section and the final disposition is not recorded on the record, the division shall conduct research to obtain the disposition within thirty business days after receipt of the record. If the division cannot determine, within thirty business days after receipt of the person's state and federal criminal history record information, whether the person is awaiting trial on or has been convicted of committing or attempting, soliciting, facilitating or conspiring to commit any of the offenses listed in subsection B or C of this section in this state or the same or a similar offense in another state or jurisdiction, the division shall not issue a level I fingerprint clearance card to the person. If the division is unable to make the determination required by this subsection and does not issue a level I fingerprint clearance card to a person, the person may request a good cause exception pursuant to section 41-619.55.

M. If after conducting a state and federal criminal history records check the division determines that it is not authorized to issue a level I fingerprint clearance card to an applicant, the division shall notify the agency that the division is not authorized to issue a level I fingerprint clearance card. This notice shall include the criminal history information on which the denial was based. This criminal history information is subject to dissemination restrictions pursuant to section 41-1750 and Public Law 92-544.

N. The division is not liable for damages resulting from:

The issuance of a level I fingerprint clearance card to an applicant who is later found to have been ineligible to receive a level I fingerprint clearance card at the time the card was issued.
The denial of a level I fingerprint clearance card to an applicant who is later found to have been eligible to receive a level I fingerprint clearance card at the time issuance of the card was denied.

O. Notwithstanding any law to the contrary, an individual may apply for and receive a level I fingerprint clearance card pursuant to this section to satisfy a requirement that the person have a valid fingerprint clearance card issued pursuant to section 41-1758.03.

P. Notwithstanding any law to the contrary, except as prescribed pursuant to subsection Q of this section, an individual who receives a level I fingerprint clearance card pursuant to this section also satisfies a requirement that the individual have a valid fingerprint clearance card issued pursuant to section 41-1758.03.

Q. Unless a cardholder commits an offense listed in subsection B or C of this section after June 29, 2009, a fingerprint clearance card issued pursuant to section 41-1758.03 before June 29, 2009 and its renewals are valid for all requirements for a level I fingerprint clearance card except those relating to the requirements of section 8-105 or 8-509. A fingerprint clearance card issued before June 29, 2009 to meet the requirements of section 8-105 or 8-509 and its renewals are valid after June 29, 2009 to meet all requirements for a level I fingerprint clearance card, including the requirements of section 8-105 or 8-509, if the cardholder has been certified by the court to adopt or has been issued a foster home license before June 29, 2009.

R. The issuance of a level I fingerprint clearance card does not entitle a person to employment.

S. For the purposes of this section:

"Person" means a person who is fingerprinted pursuant to:

(a) Section 3-314, 8-105, 8-463, 8-509, 8-802, 17-215, 36-207, 36-594.01, 36-594.02, 36-882, 36-883.02, 36-897.01, 36-897.03, 36-1940, 36-1940.01, 36-2819, 36-2855, 41-619.52, 41-619.53, 41-1964, 41-1967.01, 41-1968, 41-1969 or 46-141.

(b) Subsection O of this section.

"Renewal" means the issuance of a fingerprint clearance card to an existing fingerprint clearance cardholder who applies before the person's existing fingerprint clearance card expires.

§ 41-1758.08 Fingerprint clearance card; use of expired card

A. Notwithstanding any other law, an expired fingerprint clearance card may be used to satisfy the fingerprint requirements of section 15-183, 15-503, 15-512, 15-534, 15-782.02, 15-1330 or 15-1881 if the person signs an affidavit stating both of the following:

The person submitted a completed application to the division for a new fingerprint clearance card within ninety days before the expiration date on the person's current fingerprint clearance card.
The person is not awaiting trial on and has not been convicted of a criminal offense that would make the person ineligible for a fingerprint clearance card.

B. This section does not apply to a fingerprint clearance card that has been denied, suspended or revoked or to a person who has requested a good cause exception hearing.

Article 4 Division of Narcotics Enforcement and Criminal Intelligence

§ 41-1761 Division of narcotics enforcement and criminal intelligence; agents; qualifications

A. There is established a division of narcotics enforcement and criminal intelligence within the department which shall consist of a superintendent who shall be experienced in criminal intelligence and have recognized ability in the field of law enforcement, and shall hold the minimum of a bachelor's degree.

B. Agents shall be appointed by the director.

C. The director may employ such special agents as he may from time to time deem necessary or advisable.

D. Agents of the division shall be vested with the same powers as other peace officers charged with the duty of law enforcement.

Article 4.1 Major Incident Division

§ 41-1762 Major incident division; superintendent; qualifications; powers; jurisdiction; definition

(Eff. 7/1/27)

A. Subject to legislative appropriation, the department shall maintain a division known as the major incident division.

B. The superintendent of the major incident division shall be selected on the basis of training and experience and have a minimum of five years of experience in the administration of law enforcement and be a certified peace officer.

C. The director may adopt rules governing the policies, procedures and administration of all activities of the major incident division.

D. The major incident division shall:

Use investigators who are certified by the Arizona peace officer standards and training board or who were sworn employees of a federal, state, county or local law enforcement agency, who have demonstrated the skills, knowledge, abilities and training as approved by the director and who have successfully completed investigative courses identified by the director and approved by the Arizona peace officer standards and training board to conduct independent investigations of critical force incidents. If an investigator described in this paragraph was employed by a federal, state, county or local law enforcement agency, the investigator must:

(a) Have retired or left the law enforcement agency in good standing.

(b) Not have been under investigation at the time of retirement or resignation from the law enforcement agency.

(d) If a veteran of the United States military, have been honorably discharged.

At the written request of a chief of police or a county sheriff, investigate a criminal allegation against a peace officer who is employed by the law enforcement agency.

E. Each law enforcement agency in this state shall require the major incident division, a regional law enforcement task force or another law enforcement agency to perform the criminal investigation of any critical force incidents in this state.

F. For the purposes of this section, "critical force incident" means:

Any discharge of a firearm by a peace officer, due to a use of force encounter, regardless of whether it results in the injury or death of an individual.
An incident involving a peace officer's intended use of deadly force or use of force by any other means that results in death or serious bodily injury of another person, either during an on-duty incident or off-duty incident while acting under the color of authority.

Article 5 Scientific Criminal Analysis Section

§ 41-1771 Crime laboratory; branch crime detection laboratories; equipment and operation

There shall be a scientific criminal analysis section, staffed by a superintendent and other necessary personnel, and established for the purpose of giving assistance to the officers of the state charged with law enforcement.

§ 41-1772 Rapid DNA testing; definitions

A. The director shall adopt rules pursuant to chapter 6 of this title prescribing procedures for administering rapid DNA testing of crime scene DNA samples, including:

Procedures for approving rapid DNA testing devices.
Procedures for ensuring the accuracy of results obtained from rapid DNA testing devices.
Qualifications for persons who conduct rapid DNA testing.
Qualifications for persons who instruct others on administering rapid DNA testing.

B. For the purposes of this section:

"Crime scene DNA sample" means a DNA sample of unknown origin that is allegedly left at the scene of a crime during the commission of a crime.
"Rapid DNA testing" means a DNA analysis that is completed within five calendar days after collecting the DNA sample.

Article 6 Training and Education Division

§ 41-1781 Training and education

A. There is established in the department, a division of training and education for law enforcement personnel.

B. The superintendent of the training and education division shall have experience in law enforcement and in the instruction of law enforcement officers. In addition, the superintendent shall have a college degree issued to him by an accredited college or university.

C. The training and education division shall:

Permit required training to be obtained at existing state, county and municipal law enforcement officer training institutions meeting the minimum standards adopted by the advisory council.
Establish training programs:

(a) For the training of the personnel of the department in their respective duties and functions, and

(b) For such peace and police officers who may be selected to attend such training programs by the authorities of the law enforcement agencies by which they are employed.

D. The training and education division shall:

Certify law enforcement training and education programs as having attained the minimum required standards established by the council.
Certify instructors as having qualified as law enforcement officer instructors under conditions established by the council.

E. The superintendent of the patrol, or the director when the department is established, in cooperation with the superintendent of public instruction and other interested agencies shall develop a program for the education of students in matters of public safety and crime prevention.

Article 7 Division of Liquor Control

§ 41-1794 Additional responsibilities of director; alcohol-related offenses; annual report

A. The director shall take such steps as are necessary to maintain effective liaison with the department of liquor licenses and control and all local law enforcement agencies regarding the consumption of spirituous liquor by persons under the age of twenty-one years.

B. All local law enforcement agencies and the department shall forward all investigative reports of licensee violations of title 4 or department of liquor licenses and control rules to the department of liquor licenses and control.

C. The director shall submit by September 30 of each year an annual report to the governor, the speaker of the house of representatives and the president of the senate detailing liaison actions taken by the department during the previous fiscal year regarding the liquor laws of this state including liaison actions taken against the consumption of spirituous liquor by persons under twenty-one years of age.

Article 7.1 Critical Infrastructure Information System

§ 41-1801 Definitions

In this article, unless the context otherwise requires:

"Critical infrastructure" means systems and assets, whether physical or virtual, that are so vital to this state and the United States that the incapacity or destruction of those systems and assets would have a debilitating impact on security, economic security, public health or safety.
"Critical infrastructure information":

(a) Means information that is not customarily in the public domain, that is related to the security of critical infrastructure or protected systems and that is related to any of the following:

(i) A disaster, either human caused, computer based or natural.

(ii) The ability of critical infrastructure to resist such a disaster, including planned or past assessments of vulnerability and risk management planning.

(iii) Planned or past operational problems regarding critical infrastructure.

(b) Includes emergency response plans.

"Critical infrastructure information system" means a program that uses advanced technologies to provide personnel who are involved in homeland security planning and operations with real time information regarding critical infrastructure within this state and critical infrastructure located outside of this state that may affect the safety and well-being of citizens of this state.

§ 41-1802 Department of public safety; critical infrastructure information program

A. The department of public safety shall coordinate a program that uses state of the art technologies and that is implemented based on the statewide assessment of threat and vulnerability by the Arizona counterterrorism information center under the oversight of the department of public safety.

B. The department of public safety shall implement the technologies to address as many critical infrastructure facilities in this state as funding allows and shall only implement the technology if agreements accepting the program are reached between participating entities, including private sector participants.

C. The department of public safety shall pursue federal monies to assist with funding the program.

§ 41-1803 Statewide critical infrastructure information system; disclosure; definition

A. The department of public safety shall establish and operate a statewide critical infrastructure information system.

B. When the department of public safety declares through written notice to all state agencies and local governments that the statewide critical infrastructure information system is operational, all state agencies and local governments shall only use the statewide critical infrastructure information system and shall not operate independent critical infrastructure information systems. State agencies and local governments are not required to use the statewide system if they are operating or developing a critical infrastructure information system before the department of public safety declares that the statewide critical infrastructure information system is operational. State agencies and local governments shall make efforts to ensure that the statewide system is interoperable with other critical infrastructure information systems allowed by law.

C. All state and local government-owned critical infrastructure facilities that are occupied by state or local government employees shall be added to the statewide critical infrastructure information system when funding is available. Nothing in this article requires any state agency or local government to add a critical infrastructure facility to the system unless the entire cost of adding the facility is provided by available federal monies.

D. Except for state and local government-owned critical infrastructure facilities, any entity may voluntarily participate in the statewide critical infrastructure information system at its own cost. Tribal participation shall be supported with federal monies provided directly or by this state under procedures established for grant allocations by the office of the governor.

E. Consistent with the guidelines developed under section 41-1804, the department of public safety shall make critical infrastructure information available, consistent with information protection procedures, to all state, local, federal and tribal law enforcement agencies, the department of emergency and military affairs, public health organizations, the Arizona department of agriculture, the department of health services, fire departments and other organizations as necessary to safeguard personnel and property in this state.

F. The department of public safety shall pursue federal monies for all state and local critical infrastructure facilities to be added to the system.

G. All critical infrastructure and key resource information that is protected by the critical infrastructure information act of 2002 (6 United States Code section 133) and that is provided to or in the possession of any state agency or political subdivision of this state, or an authorized agent of a state agency or political subdivision, is confidential and exempt from public disclosure under this chapter and title 39, chapter 1. When information is provided pursuant to this subsection, the provider is responsible for notifying the recipient that such information is critical infrastructure or key resource information.

H. For the purposes of this article, "local government" means any county, city, town, school district or tribal law enforcement agency.

§ 41-1804 Guidelines committee; duties

A. The department of public safety, in consultation with the department of emergency and military affairs, the department of administration, the department of health services, the department of agriculture, the department of environmental quality, the state department of corrections, the Arizona fire chiefs association, the Arizona association of chiefs of police, the Arizona sheriffs association, the Arizona association of counties, the league of Arizona cities and towns and representatives from every Indian tribal nation, shall convene a consulting committee to establish guidelines related to the critical infrastructure information system.

B. The committee shall:

Develop the type of information to be included in the critical infrastructure information system.
Develop critical infrastructure information technology standards to be used by all entities participating in the statewide critical infrastructure information system.
Determine the order in which critical infrastructure shall be added to the system when funding is received.
Develop guidelines on how the information shall be made available. These guidelines shall include detailed procedures and security measures to ensure that the information is only made available to the government or a private entity that either owns the critical infrastructure or is responding to an incident involving the critical infrastructure.

§ 41-1805 Violation; classification

In addition to any penalty imposed by federal law, any state or local governmental employee and any entity that submits or receives information under this article and who knowingly publishes, divulges, discloses or makes known in any manner or to any extent not authorized by law any critical infrastructure information as defined in section 41-1801 that the person knows is protected from disclosure by this article is guilty of a class 5 felony.

Article 8 Arizona Peace Officer Standards and Training Board

§ 41-1821 Arizona peace officer standards and training board; membership; appointment; term; vacancies; meetings; compensation; acceptance of grants

A. The Arizona peace officer standards and training board is established and consists of thirteen members appointed by the governor. The membership shall include:

Two sheriffs, one of whom is appointed from a county having a population of two hundred thousand or more persons and the remaining sheriff who is appointed from a county having a population of less than two hundred thousand persons.
Two chiefs of police, one of whom is appointed from a city or federally recognized Native American tribe having a population of sixty thousand or more persons and the remaining chief who is appointed from a city or federally recognized Native American tribe having a population of less than sixty thousand persons.
A college faculty member in public administration or a related field.
The attorney general.
The director of the department of public safety.
The director of the state department of corrections.
One member who is employed in administering county or municipal correctional facilities.
Two certified law enforcement officers who have knowledge of and experience in representing peace officers in disciplinary cases, neither of whom serves in a supervisory capacity and both of whom must be from different law enforcement agencies. One of the appointed officers must be from a county with a population of less than five hundred thousand persons.
Two public members.

B. Before appointment by the governor, a prospective member of the board shall submit a full set of fingerprints to the governor for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

C. The governor shall appoint a chairman from among the members at its first meeting and every year thereafter, except that an ex officio member shall not be appointed chairman. The governor shall not appoint more than one member from the same law enforcement agency. No board member who was qualified when appointed becomes disqualified unless the member ceases to hold the office that qualified the member for appointment.

D. Meetings shall be held at least quarterly or on the call of the chairman or by the written request of five members of the board or by the governor. A vacancy on the board shall occur when a member except an ex officio member is absent without the permission of the chairman from three consecutive meetings. The governor may remove a member except an ex officio member for cause.

E. The term of each regular member is three years unless a member vacates the public office that qualified the member for this appointment.

F. The board members are not eligible to receive per diem but are eligible to receive reimbursement for travel expenses pursuant to title 38, chapter 4, article 2.

G. On behalf of the board, the executive director may seek and accept contributions, grants, gifts, donations, services or other financial assistance from any individual, association, corporation or other organization having an interest in police training, and from the United States of America and any of its agencies or instrumentalities, corporate or otherwise. Only the executive director of the board may seek monies pursuant to this subsection. Such monies shall be deposited in the fund created by section 41-1825.

H. Membership on the board shall not constitute the holding of an office, and members of the board shall not be required to take and file oaths of office before serving on the board. No member of the board shall be disqualified from holding any public office or employment nor shall such member forfeit any such office or employment by reason of such member's appointment, notwithstanding the provisions of any general, special or local law, ordinance or city charter.

§ 41-1822 Powers and duties of board; definition

A. With respect to peace officer training and certification, the board shall:

Establish rules for the government and conduct of the board, including meeting times and places and matters to be placed on the agenda of each meeting.
Make recommendations, consistent with this article, to the governor, the speaker of the house of representatives and the president of the senate on all matters relating to law enforcement and public safety.
Prescribe reasonable minimum qualifications for officers to be appointed to enforce the laws of this state and the political subdivisions of this state and certify officers in compliance with these qualifications. Notwithstanding any other law, the qualifications shall require United States citizenship, shall relate to physical, mental and moral fitness and shall govern the recruitment, appointment and retention of all agents, peace officers and police officers of every political subdivision of this state. The board shall constantly review the qualifications established by this section and may amend the qualifications at any time, subject to the requirements of section 41-1823.
Prescribe minimum courses of training and minimum standards for training facilities for law enforcement officers. Only this state and political subdivisions of this state may conduct basic peace officer training. Basic peace officer academies may admit individuals who are not peace officer cadets only if a cadet meets the minimum qualifications established by paragraph 3 of this subsection. Training shall include:

(a) Courses in responding to and reporting all criminal offenses that are motivated by race, color, religion, national origin, sexual orientation, gender or disability.

(b) Training certified by the director of the department of health services with assistance from a representative of the board on the nature of unexplained infant death and the handling of cases involving the unexplained death of an infant.

(c) Medical information on unexplained infant death for first responders, including awareness and sensitivity in dealing with families and child care providers, and the importance of forensically competent death scene investigations.

(d) Information on the protocol of investigation in cases of an unexplained infant death, including the importance of a consistent policy of thorough death scene investigation.

(e) The use of the infant death investigation checklist pursuant to section 36-3506.

(f) If an unexplained infant death occurs, the value of timely communication between the medical examiner's office, the department of health services and appropriate social service agencies that address the issue of infant death and bereavement, to achieve a better understanding of these deaths and to connect families to various community and public health support systems to enhance recovery from grief.

Recommend curricula for advanced courses and seminars in law enforcement and intelligence training in universities, colleges and community colleges, in conjunction with the governing body of the educational institution.
Make inquiries to determine whether this state or political subdivisions of this state are adhering to the standards for recruitment, appointment, retention and training established pursuant to this article. The failure of this state or any political subdivision to adhere to the standards shall be reported at the next regularly scheduled meeting of the board for action deemed appropriate by that body.
Employ an executive director and other staff as are necessary to fulfill the powers and duties of the board in accordance with the requirements of the law enforcement merit system council.

B. With respect to state department of corrections correctional officers, the board shall:

Approve a basic training curriculum of at least two hundred forty hours.
Establish uniform minimum standards. These standards shall include high school graduation or the equivalent and a physical examination as prescribed by the director of the state department of corrections.
Establish uniform standards for background investigations, including criminal histories under section 41-1750, of all applicants before enrolling in the academy. The board may adopt special procedures for extended screening and investigations in extraordinary cases to ensure suitability and adaptability to a career as a correctional officer.
Issue a certificate of completion to any state department of corrections correctional officer who satisfactorily complies with the minimum standards and completes the basic training program. The board may issue a certificate of completion to a state department of corrections correctional officer who has received comparable training in another state if the board determines that the training was at least equivalent to that provided by the academy and if the person complies with the minimum standards.
Establish continuing training requirements and approve curricula.

C. With respect to peace officer misconduct, the board may:

Receive complaints of peace officer misconduct from any person, request law enforcement agencies to conduct investigations and conduct independent investigations into whether an officer is in compliance with the qualifications established pursuant to subsection A, paragraph 3 of this section.
Receive a complaint of peace officer misconduct from the president or chief executive officer of a board recognized law enforcement association that represents the interests of certified law enforcement officers if the association believes that a law enforcement agency refused to investigate or made findings that are contradictory to prima facie evidence of a violation of the qualifications established pursuant to subsection A, paragraph 3 of this section. If the board finds that the law enforcement agency refused to investigate or made findings that contradicted prima facie evidence of a violation of the qualifications established pursuant to subsection A, paragraph 3 of this section, the board shall conduct an independent investigation to determine whether the officer is in compliance with the qualifications established pursuant to subsection A, paragraph 3 of this section and provide a letter of the findings based on the investigation conducted by the board to the president or chief executive officer of the board recognized law enforcement association who made the complaint.

D. The board may:

Deny, suspend, revoke or cancel the certification of an officer who is not in compliance with the qualifications established pursuant to subsection A, paragraph 3 of this section.
Provide training and related services to assist state, tribal and local law enforcement agencies to better serve the public, including training for emergency alert notification systems.
Enter into contracts to carry out its powers and duties.

E. This section does not create a cause of action or a right to bring an action, including an action based on discrimination due to sexual orientation.

F. For the purposes of this section, "sexual orientation" means consensual homosexuality or heterosexuality.

§ 41-1823 Adoption of minimum qualifications; certification required

A. No minimum qualifications for law enforcement officers adopted pursuant to this article shall be effective until six months after they have been filed with the secretary of state pursuant to section 41-1031.

B. Except for agency heads duly elected as required by the constitution and persons given the authority of a peace officer pursuant to section 8-205, 11-572, 12-253, 13-916 or 22-131, no person may exercise the authority or perform the duties of a peace officer unless he is certified by the board pursuant to section 41-1822, subsection A, paragraph 3.

§ 41-1824 Training expenditures

In exercising its powers and duties, the board shall endeavor to minimize costs of administration, including utilization of training facilities already in existence and available, so that the greatest possible proportion of the funds available to it shall be expended for the purposes of providing training for local law enforcement officers.

§ 41-1825 Peace officers' training fund

A. A special fund designated as the peace officers' training fund is established. All monies deposited in the fund are continuously appropriated to the department of public safety for the benefit of the board. The monies shall be used exclusively for the costs of training peace officers, including Indian tribe police officers who are training to be qualified pursuant to section 13-3874 and full authority peace officers who are appointed by the director of the state department of corrections and the director of the department of juvenile corrections, for grants to state agencies, counties, cities and towns of this state for peace officer training and for expenses for the operation of the board. No peace officers' training fund monies may be spent for training correctional officers of the state department of corrections.

B. All amounts to be paid or advanced from the fund shall be on warrants drawn by the department of administration on presentation of a proper claim or voucher that is approved and signed by the executive director.

C. The executive director shall lawfully disburse monies as approved by the board.

D. The board may use and the department of public safety shall provide to the board administrative support services. The board shall reimburse the department for expenses incurred for administrative support services. This subsection does not require the department to provide administrative support services that are different in kind from those that were provided on January 1, 2000. For the purposes of this subsection, "administrative support services" includes all services relating to business office, finance and procurement, information management and technology, fleet, human resources, supply, telecommunications, facilities, security and clerical and administrative assistance personnel.

§ 41-1826 Arizona law enforcement training academy; former property; title transfer

A. Notwithstanding any law to the contrary and for the benefit of the board, the department of public safety shall transfer to the state department of corrections the title to the property that was formerly known as the Arizona law enforcement training academy and that is operated as the correctional officer training academy in Tucson.

B. If at any time after title is transferred the state department of corrections leases or sells the property, the proceeds from the lease or sale shall be deposited, pursuant to sections 35-146 and 35-147, as follows:

53.66 per cent of the proceeds or 53.66 per cent of the fair market value, whichever is greater, in the peace officers' training fund established by section 41-1825.
46.34 per cent of the proceeds or 46.34 per cent of the fair market value, whichever is greater, in the state general fund.

§ 41-1827 Application for grants

Any state agency, county, city or town which desires to receive a grant pursuant to section 41-1825 shall make application to the board for such aid. The application shall contain such information as the board may request.

§ 41-1828 Allocation of monies

A. On the recommendation of the board, the executive director shall allocate and the state treasurer shall pay from the peace officers' training fund to each county, city or town of this state that has applied and qualified for a grant pursuant to this chapter a sum that will reimburse the political subdivision in an amount not to exceed one-half of the salary paid to each peace officer while participating in training. The cost of the training and living and travel expenses up to the maximum as prescribed by title 38, chapter 4, article 2 that are incurred by state, county, city or town officers while participating in training may be paid to the appropriate state agency or political subdivision.

B. If the monies in the peace officers' training fund budgeted by the board for such salary reimbursement are insufficient to allocate such amount to each participating county, city or town, the amount that is allocated to each shall be reduced proportionately. The board may refuse to allocate monies to any state agency, county, city or town that has not, throughout the period covered by the allocation, adhered to the recruitment and training standards established by the board as applicable to personnel recruited or trained by the state agency, county, city or town during the allocation period.

§ 41-1828.01 Required law enforcement agency reporting

A. A law enforcement agency may report to the board any peace officer misconduct in violation of the rules for retention established pursuant to section 41-1822, subsection A, paragraph 3 at any time and shall report this misconduct on the peace officer's termination, resignation or separation from the agency.

B. On request of a law enforcement agency conducting a background investigation of an applicant for the position of a peace officer, another law enforcement agency employing, previously employing or having conducted a complete or partial background investigation on the applicant shall advise the requesting agency of any known misconduct in violation of the rules for retention established pursuant to section 41-1822, subsection A, paragraph 3.

C. Civil liability may not be imposed on either a law enforcement agency or the board for providing information specified in subsections A and B of this section if there exists a good faith belief that the information is accurate.

§ 41-1828.02 Certified peace officers; hiring reimbursement; definition

A. A law enforcement agency in this state or a city, town, county or political subdivision of this state that employs a peace officer and that pays the costs of the peace officer's certification and training under section 41-1822 may seek reimbursement for the costs of the law enforcement officer's certification and training from a hiring law enforcement agency. The hiring law enforcement agency shall reimburse all of the costs related to the peace officer's certification and training, including travel, housing and salary during the training, as follows:

One hundred percent of all costs, if the certified peace officer leaves the original law enforcement agency within twelve months after employment.
Seventy-five percent of all costs, if the certified peace officer leaves the original law enforcement agency after twelve months and not more than twenty-four months after employment.
Fifty percent of all costs, if the certified peace officer leaves the original law enforcement agency after twenty-four months and not more than thirty-six months after employment.

B. The original law enforcement agency may waive reimbursement for a certified peace officer who voluntarily leaves employment and who is subsequently employed by the hiring law enforcement agency for any reason. Employee hardship and extenuating family circumstances shall be considered presumptive reasons for reimbursement waivers.

C. The hiring law enforcement agency may not require a certified peace officer to assume responsibility for repaying the peace officer's certification costs or any other related costs in an effort to be reimbursed pursuant to this section.

D. When making employment decisions, a hiring law enforcement agency may not consider whether the hiring law enforcement agency will be required to make reimbursement for certification and training costs pursuant to this section if a particular applicant is employed.

E. The original law enforcement agency shall submit an itemized statement to the certified peace officer's hiring law enforcement agency for payment and may enforce collection of any obligation through civil remedies and procedures.

F. A law enforcement agency shall include an explanation of the hiring reimbursement requirements prescribed by this section in the employment documentation provided to a certified peace officer during the law enforcement agency's hiring process.

G. This section does not apply to an employee who leaves the original law enforcement agency and is not employed as a certified peace officer for one year or more and is subsequently hired by a hiring law enforcement agency.

H. For the purposes of this section, "hiring law enforcement agency" means a law enforcement agency in this state or a city, town, county or political subdivision of this state that does both of the following:

Subsequently hires a certified peace officer after the certified peace officer voluntarily leaves the employment of the law enforcement agency that paid the peace officer's costs of certification.
Hired the officer as a certified peace officer.

Article 8.1 Peace Officers Memorial

§ 41-1829 Arizona peace officers memorial board

A. The Arizona peace officers memorial board is established consisting of the following members:

The attorney general or the attorney general's designee, who shall serve as permanent chairperson.
The director of the department of public safety or the director's designee.
The director of the state department of corrections or the director's designee.
The executive director of the Arizona criminal justice commission or the executive director's designee.
Eleven members appointed pursuant to subsection B of this section.
As advisory members, the chairpersons of the appropriations and judiciary committees of the house of representatives and the senate. For the purposes of this paragraph, "advisory member" means a member who gives advice to the other members of the peace officers memorial board at meetings of the board but who is not eligible to vote and is not a member for purposes of determining whether a quorum is present.

B. The permanent chairperson shall appoint one private citizen who is knowledgeable in the history of law enforcement in this state, one county sheriff or the county sheriff's designee, one local police chief or the police chief's designee, two members selected from a recognized fraternal organization for law enforcement personnel, two representatives from the business community, two family members of peace officers who have lost their lives in the line of duty and two members from a statewide organization representing law enforcement personnel.

C. The board shall meet at the call of the permanent chairperson.

D. Members of the board are not eligible to receive compensation, but members appointed pursuant to subsection B of this section are entitled to reimbursement from the Arizona peace officers memorial fund for reasonable expenses in traveling on and attending to official board business.

§ 41-1829.01 Arizona peace officers memorial board; duties

A. The Arizona peace officers memorial board shall:

Add to the memorial at least annually the names of all members of the law enforcement community in this state who have lost their lives in the line of duty and provide for a dedication ceremony which commemorates the addition of their names.
Plan and provide for the maintenance of the peace officers memorial.
Report annually to the president of the senate and the speaker of the house of representatives on the progress of the memorial and shall provide a copy of this report to the secretary of state and the director of the Arizona state library, archives and public records.
Determine those persons who are eligible for the tuition waiver pursuant to section 15-1808 and report the determination to the Arizona board of regents or to each community college district governing board, as applicable.

B. The Arizona peace officers memorial board may:

Solicit private monetary donations for deposit in the Arizona peace officers memorial fund.
Use the monies deposited in the Arizona peace officers memorial fund established by section 41-1829.02 for persons who are eligible for the tuition waiver pursuant to section 15-1808 to pay for tuition, if tuition has not been waived, and other educational expenses incurred at a community college or a publicly or privately funded college or university or technical school.

§ 41-1829.02 Arizona peace officers memorial fund

A. An Arizona peace officers memorial fund is established. The fund shall consist of monies provided by appropriation or received as donations as provided for in this article. The state treasurer shall invest and divest all monies in the Arizona peace officers memorial fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. The state treasurer shall administer the fund. The monies in the fund are exempt from section 35-190, relating to lapsing of appropriations.

B. The costs and expenses authorized by this article shall be paid for by the state treasurer from the monies available in the Arizona peace officers memorial fund on certification to the state treasurer by the permanent chairman of the Arizona peace officers memorial board that the amount requested is owed for a valid purpose.

Article 9 Arizona Prosecuting Attorneys' Advisory Council

§ 41-1830 Council; membership; staff

A. There is established the Arizona prosecuting attorneys' advisory council which shall consist of all county attorneys, the attorney general or his designee, the dean of the law school of Arizona state university or the university of Arizona, the chief municipal or city prosecutor of each city that has a population of more than two hundred fifty thousand and one full-time municipal prosecutor from a municipality that has a population of two hundred fifty thousand or less appointed by the governor, and the chief justice of the Arizona supreme court or his designee. Meetings shall be held at least quarterly or upon call of the chairman or by the written request of five members of the council or by the governor. The council may employ an executive director and such other staff, including clerical assistants, as are necessary to fulfill the purposes of the council.

B. The term of each regular member shall be three years unless a member vacates the public office which qualified him for this appointment.

C. No compensation shall be paid for serving on the council.

D. The council may accept contributions, grants, gifts, donations, services or other financial assistance from any individual, association, corporation or other organization having an interest in prosecution training, and from the United States of America and any of its agencies or instrumentalities, corporate or otherwise. Such monies shall be deposited in the fund created by section 41-1830.03.

E. Membership on the council shall not constitute the holding of an office, and members of the council shall not be required to take and file oaths of office before serving on the council. No member of the council shall be disqualified from holding any public office or employment, nor shall he forfeit any such office or employment by reason of his appointment, notwithstanding the provisions of any general, special or local law, ordinance or city charter.

§ 41-1830.01 Powers and duties

The council shall assist in the coordination of the duties of the prosecuting attorneys of this state and their staffs and, in this capacity, it shall:

Establish rules and regulations for the government and conduct of the council, including meeting times, places and matters to be placed on the agenda of each meeting.
Prepare manuals of procedure.
Give assistance in the preparation of trial briefs, forms and instructions.
Conduct research and studies that would be of interest and value to all prosecuting attorneys and their staffs.
Provide training programs for prosecuting attorneys and other criminal justice personnel.
Maintain liaison contact with study commissions and agencies of all branches of local, state and federal government that will be of benefit to law enforcement and the fair administration of justice in this state.
Establish training standards for prosecuting attorneys and assist in meeting those standards by promulgating rules and procedures relating to such standards.
File an annual report of financial receipts and expenditures with the governor, speaker of the house and president of the senate.

§ 41-1830.02 Expenditure of funds for training prosecuting attorneys

In exercising its powers and duties, the council shall endeavor to minimize costs of administration, including utilization of training facilities already in existence and available, so that the greatest possible proportion of the funds available to it shall be expended for the purposes of providing training for prosecuting attorneys.

§ 41-1830.03 Prosecuting attorneys' advisory council training fund

A. There shall be a special fund designated as the Arizona prosecuting attorneys' advisory council training fund. All monies deposited in the fund are continuously appropriated to the attorney general, and shall be used exclusively for costs of training, technical assistance for prosecuting attorneys of the state and any of its political subdivisions, and expenses for the operation of the council.

B. All amounts to be paid from the fund shall be on warrants drawn by the department of administration upon presentation of a proper claim or voucher approved by the council and signed by the attorney general or his designee.

C. The administration of the provisions of this article shall be funded exclusively from the Arizona prosecuting attorneys' advisory council training fund. No monies from the state general fund shall be deposited in the Arizona prosecuting attorneys' advisory council training fund.

§ 41-1830.05 Costs

The council may reimburse prosecuting attorneys and council staff for travel and per diem expenses from the prosecuting attorneys' advisory council training fund in an amount not to exceed the amounts authorized pursuant to title 38, chapter 4, article 2.

Article 10 Law Enforcement Merit System Council

§ 41-1830.11 Law enforcement merit system council; composition

A. The governor shall appoint a law enforcement merit system council pursuant to section 38-211. The council consists of five persons. No more than three members shall belong to the same political party. Persons eligible for appointment shall have had a continuous recorded registration pursuant to title 16, chapter 1 with either the same political party or as an independent for at least two years immediately preceding appointment. Members appointed shall be persons who are committed to enforcing this article in an honest, independent and impartial fashion and to seeking to uphold public confidence in the integrity of public safety peace officers. The members of the council shall not have held elective public office within one year before appointment and shall not hold any other political office while serving on the council.

B. The governor shall fill a vacancy on the same basis as the original appointment.

C. Members of the council are eligible to receive compensation for their services in the amount of one hundred dollars for each meeting attended, prorated for partial days for each meeting attended.

D. A member serves for a term of three years. The governor may remove a member only for cause.

E. The chairman of the council serves as an ex officio member of the state personnel board without voting privileges.

§ 41-1830.12 Law enforcement merit system council; duties; authority; rules; business manager; definitions

A. The law enforcement merit system council shall:

Select a chairman and vice-chairman.
Hold meetings that are necessary to perform its duties on the call of the chairman.
Adopt rules pursuant to recognized merit principles of public employment it deems necessary for establishing the following for department of public safety and Arizona peace officer standards and training board personnel:

(a) A classification and compensation plan for all covered positions and for establishing standards and qualifications for all classified positions from a list of necessary employees that is prepared by the director of the employing agency.

(b) A plan for fair and impartial selection, appointment, probation, promotion, retention and separation or removal from service by resignation, retirement, reduction in force or dismissal of all classified employees.

(d) Procedures for the conduct of hearings of employee grievances that are brought before the council relating to classification, compensation and the employee appraisal system.

(e) Procedures for the conduct of hearings on appeals from an order of the director of the employing agency in connection with suspension, demotion, reduction in pay, loss of accrued leave time or dismissal of a classified employee.

(f) For hours of employment, annual and sick leave and special leaves of absence, with or without pay or with reduced pay.

Pursuant to recognized merit principles, hear and review appeals from any order of the director of the employing agency in connection with suspension, demotion, reduction in pay, loss of accrued leave time or dismissal of a classified employee. The council's determination is subject to review by the director and appeal as provided in section 41-1830.13.

B. The council may meet with the state personnel board to discuss matters of mutual concern.

C. The rules under subsection A, paragraph 3, subdivision (f) of this section shall provide for the transfer of accumulated annual leave from one employee to another employee in the same agency and for the transfer of accumulated annual leave from one employee to another employee of another agency, department, board or commission if the employees are members of the same family. The transfers may occur if the employee to whom the leave is transferred has a seriously incapacitating and extended illness or injury or a member of the employee's immediate family has a seriously incapacitating and extended illness or injury and the employee has exhausted all available leave balances. Transferred annual leave shall be increased or reduced proportionally by the difference in the salaries of the employees as determined by council rule. For the purposes of this subsection, "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 or father-in-law.

D. In hearing and reviewing an appeal from any order of the director of the employing agency, the council:

Shall determine whether the employing agency has proven by a preponderance of the evidence that the employing agency had just cause to discipline the employee.
May recommend modification of a disciplinary action if the director of the employing agency has not proven by a preponderance of the evidence that the employing agency had just cause to discipline the employee.
Shall reverse the decision of the director of the employing agency if the council finds that just cause did not exist for any discipline to be imposed and, in the case of dismissal or demotion, return the employee to the same position the employee held before the dismissal or demotion with or without back pay.

E. On a finding that the director of the employing agency has not proven just cause to discipline the employee by a preponderance of the evidence, the council may recommend a proposed disciplinary action in light of the facts proven.

F. Within forty-five days after the conclusion of the hearing, the council shall enter its decision or recommendation and at the same time shall send a copy of the decision or recommendation by certified mail to the employing agency and to the employee at the employee's address as given at the hearing or to a representative designated by the employee to receive a copy of the decision or recommendation.

G. The council shall select and the director of the department of public safety shall appoint a business manager who is a certified peace officer and an employee of the department of public safety but who is not a member of the council. The business manager shall perform and discharge all of the powers and duties that are vested in the council, except that adoption of rules, creation and adjustment of classifications and grades, compensation and hearing appeals for dismissal, demotion, reduction in pay, suspensions or other punitive action remain the duty of the council. Any power or duty that the council may lawfully delegate to the business manager is conclusively presumed to have been delegated to the business manager unless it is shown that the council by an affirmative vote recorded in its minutes has specifically reserved the power or duty to itself. At the request of the council, the business manager may make inquiries regarding or investigate infractions of council rules within the department of public safety. The business manager shall report the result of the inquiry or investigation to the council for appropriate action. The business manager may delegate the business manager's powers and duties to the business manager's subordinates unless by council rule or express provision of law the business manager is specifically required to act personally.

H. For the purposes of this section and section 41-1830.13:

"Director of the employing agency" means the director of the department of public safety with respect to employees of the department and the executive director of the Arizona peace officer standards and training board with respect to employees of the board.
"Just cause" has the same meaning prescribed in title 38, chapter 8, article 1.

§ 41-1830.13 Review of council decision by agency director; appeal; reinstatement

A. Within fourteen days of receipt of the finding or recommendation by the council pursuant to section 41-1830.12, the director of the employing agency shall accept, modify or reverse the council's decision or accept, modify or reject the council's recommendation. The director shall accept the council's recommendation unless the recommendation is arbitrary or without reasonable justification. If the director does not accept the council's recommendation, the director shall state the reason or reasons for rejecting the recommendation. The decision of the director of the employing agency is final and binding. The director of the employing agency shall send a copy of the agency's final determination to the employee pursuant to section 41-1830.12.

B. Except as provided in section 41-1092.08, subsection H, a classified employee who is suspended, is demoted, has pay reduced, loses accrued leave time or is dismissed pursuant to this article, after a fair hearing and review before the law enforcement merit system council and review of the suspension, demotion, reduction in pay, loss of accrued leave time or dismissal by the director of the employing agency, may appeal the determination of the council and the final determination of the director of the employing agency pursuant to title 12, chapter 7, article 6.

C. In addition to the trial court's powers as prescribed in section 12-911, if the court overrules the determination of the council or the director of the employing agency, the employee shall be reinstated in the employee's position and the employee shall receive full compensation for any salary withheld pending the determination by the council, the director of the employing agency and court.

§ 41-1830.15 Causes for dismissal or discipline; definitions

A. The director of the department of public safety may dismiss or discipline any classified employee based on any of the following causes:

Fraud or misrepresentation in securing employment.
Incompetency.
Inefficiency.
Inexcusable neglect of duty or unauthorized absence.
Insubordination.
Dishonesty.
Physical or mental disability subject to the provisions of the Americans with disabilities act of 1990 (42 United States Code sections 12101 through 12213).
Unauthorized drinking on duty or drunkenness on duty.
Being impaired by alcohol or drugs, as provided in title 13, chapter 34, while on duty.
Commission of any crime classified as a felony.
Discourteous treatment of the public or other employees.
Commission of any crime involving moral turpitude.
Improper political activity as proscribed in section 41-752.
Misuse or unauthorized use of state property.
Addiction to the illegal use of a narcotic or dangerous drug.
Any other failure of good behavior or acts either during or outside of duty hours that are incompatible with or inimical to the interest of the department of public safety.

B. For the purposes of this section:

"Incompetency" means the lack of ability or judgment, legal qualifications or fitness to discharge required duties.
"Inefficiency" means the failure to produce as required for reasons other than incompetency.

§ 41-1830.16 Law enforcement merit system council duties; authority; appeals of covered full authority peace officers employed by agencies in the state personnel system; definitions

A. The law enforcement merit system council shall adopt rules the council deems necessary for the administration of hearings and the review of appeals as prescribed in this section.

B. A covered employee in the state personnel system who is a full authority peace officer as certified by the Arizona peace officer standards and training board, who is appointed to a position that requires such a certification in the covered service and who has completed the employee's original probationary period of service as provided by the personnel rules may appeal to the law enforcement merit system council the covered employee's dismissal from covered service, suspension for more than forty working hours or involuntary demotion resulting from disciplinary action. The covered employee shall file the appeal not later than ten working days after the effective date of the action. The covered employee shall be furnished with specified charges in writing when the action is taken. The appeal shall be in writing and must state specific facts relating directly to the charges on which the appeal is based. Notwithstanding section 41-1092.05, subsection D, the law enforcement merit system council shall hear the appeal within thirty days after the council's receipt of the appeal. The law enforcement merit system council shall provide the employing agency with a copy of the appeal not less than twenty days before the hearing.

C. In hearing and reviewing an appeal, the council:

Shall determine whether the employing agency has proven by a preponderance of the evidence that the employing agency had just cause to discipline the employee.
May recommend modification of a disciplinary action if either of the following is met:

(a) The state agency head has not proven by a preponderance of the evidence that the employing agency had just cause to discipline the employee.

(b) The state agency head has proven that the employing agency had just cause to discipline the employee but evidence presented by the employee or the employing agency, any legal basis brought in the appeal or any other facts or circumstances offered for the council's consideration demonstrate that the disciplinary action should be modified.

Shall reverse the decision of the state agency head if the council finds that just cause did not exist for any discipline to be imposed and, in the case of dismissal or demotion, return the employee to the same position the employee held before the dismissal or demotion with or without back pay.

D. On a finding that the state agency head has not proven just cause to discipline the employee by a preponderance of the evidence, the council may recommend a proposed disciplinary action in light of the facts proven.

E. Within forty-five days after the conclusion of the hearing, the council shall enter its decision or recommendation and shall at the same time send a copy of the decision or recommendation by certified mail to the employing agency and to the employee at the employee's address as given at the hearing or to a representative designated by the employee to receive a copy of the decision or recommendation. The state agency head or the agency head's designee shall accept, modify or reverse the council's decision or accept, modify or reject the council's recommendation within fourteen days after receipt of the findings or recommendation from the law enforcement merit system council. The state agency head or the agency head's designee shall accept the council's recommendation unless the recommendation is arbitrary or without reasonable justification. If the state agency head or the agency head's designee does not accept the council's recommendation, the state agency head or the agency head's designee shall state the reasons for rejecting the recommendation. The decision of the agency head or agency head's designee is final and binding. The agency head shall send a copy of the agency's final determination to the covered employee pursuant to this section.

F. Any party may appeal the decision of the law enforcement merit system council or the final decision of the agency pursuant to title 12, chapter 7, article 6 to the superior court in the covered employee's county of residence.

G. An appeal shall be available to the court of appeals from the order of the superior court pursuant to title 12, chapter 7, article 6 as in other civil cases.

H. For the purposes of this section:

"Covered employee" has the same meaning prescribed in section 41-741.
"Covered service" has the same meaning prescribed in section 41-741.
"Employing agency" means the agency in the state personnel system where the covered employee is or, in the case of dismissal, was employed.
"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.
"Just cause" has the same meaning prescribed in section 38-1101.
"Original probationary period" has the same meaning prescribed in section 41-741.
"Personnel rules" means the rules adopted by the department of administration, human resources division.
"State agency head" means the chief executive officer of the employing agency.
"State personnel system" has the same meaning prescribed in section 41-741.

Article 11 Private Prison Escapee Fund

§ 41-1830.31 Private prison escapee fund; monies; uses; lapsing; definitions

A. A private prison escapee fund is established for the purposes of providing monies to cover capture costs associated with escapees or liabilities that the state may incur. The fund consists of the monies deposited pursuant to subsection B of this section and section 41-1682, subsection B, paragraph 1. The director of the department of administration shall administer the fund.

B. All private prisons shall pay a penalty to the director of the department of administration for the capture costs of an escapee in the amount of ten thousand dollars per escapee or the actual capture costs per escapee, whichever is more. The director of the department of administration shall deposit the monies received from the private prison into the private prison escapee fund.

C. Fund monies shall be used to reimburse law enforcement agencies of this state for the costs incurred by them in capturing prisoners who escape from private prisons.

D. A detailed account of the costs incurred in capturing escapees shall be submitted to the director of the department of public safety and reimbursed on approval by the director.

E. Monies in the private prison escapee fund do not revert to the state general fund. The monies in the fund are a continuing appropriation to the director of the department of administration for the purposes prescribed in this section.

F. The director of the department of administration shall reimburse monies deposited in the fund by private prisons as prescribed by section 41-1682, subsection B, paragraph 1 after receiving notification from the director of the state department of public safety to reimburse the monies.

G. For the purposes of this section:

"Escapee" means a prisoner who leaves a private prison facility without lawful authorization and whose leaving requires law enforcement personnel to undertake actions to capture the prisoner.
"Private prison" means any privately owned prison that does not contract exclusively with the state department of corrections and is primarily directed at housing adult prisoners who are sentenced to serve a term of detention or incarceration by a court from a state other than this state.

Article 12 Towing Services

§ 41-1830.51 Vehicle towing; rules; contractual agreement for towing services; definition

A. The director shall:

Adopt and enforce rules that are not inconsistent with this article to govern the design and operation of all tow trucks.
Adopt guidelines to protect consumers against being overcharged for towing services. The guidelines shall specify that a larger class of tow vehicle used for lighter tows must be billed at the lighter duty towing service rates.

B. The director or a county, city or town may enter into a contractual agreement with a towing firm or firms for towing or storage services, or both. At the time of application for a contractual agreement, a towing firm must disclose in writing the owners of the towing firm and, if the owners own other towing firms that are also applying for the same contractual agreement, the names of those towing firms. The contractual agreement shall comply with this section and all rules adopted under this section. Contracts shall be awarded on the basis of competitive bidding. The director or a county, city or town shall reserve the right to reject all bids. If only one bid is received, the director or a county, city or town may reject the bid and negotiate a contract without bidding if the negotiated contract is at a price lower than the bid price under the terms and conditions specified in the call for bids.

C. Except as provided in subsection D of this section, a towing firm may only have one contractual agreement per geographic towing area with the department or a county, city or town for towing or storage services, or both. If an owner of a towing firm has a common ownership interest in another towing firm or the assets, or shared use of the assets, of another towing firm, the owner may not participate in any other application for a contractual agreement within the same geographic towing area for that application. The department or a county, city or town must determine that each towing firm is in compliance with this subsection. The director or a county, city or town must review any complaints that are submitted with supporting documentation and that allege a violation of this subsection.

D. If a towing firm that has a contractual agreement pursuant to this section acquires another towing firm that has a contractual agreement pursuant to this section, both contractual agreements remain valid for one year after the date of the acquisition or until the end of the contractual agreement, whichever is shorter.

E. Notwithstanding subsection C of this section, an agency may allow a towing firm to use resources from another towing firm if an agency deems the use of those resources is necessary for traffic incident management.

F. If towing companies share any employees or staff, the companies shall be considered as one company for the purposes of the rotation list in that geographically contracted towing area.

G. For the purposes of this section, "asset" means any property that has a value, including financial, intangible and physical assets, and includes:

Vehicles.
Equipment.
Stock.
A membership in a limited liability company.
A partnership interest.
A beneficial interest in a trust or another like item.

§ 41-1830.52 Department of public safety contractual agreements; towing; maximum allowable rates

A. The director shall establish the maximum allowable rates for towing vehicle classifications used in department agreements with a towing firm for towing or storage services, or both.

B. The director shall consult every even-numbered year with a statewide towing industry association and providers of towing services from each geographical towing area, to review information, including contract rates and the current industry retail rates. The director may consult additional stakeholders as needed.

C. Prior to the expiration of an existing contract the department may adjust the towing service fees to reflect information received pursuant to subsection B of this section or any other relevant information.

§ 41-1830.53 Heavy-duty rotator recovery vehicle classification; rates and guidelines; definition

(Conditionally Rpld.)

A. The department shall establish a heavy-duty rotator recovery vehicle classification for towing services and establish rates and general guidelines for the use of heavy-duty rotator recovery vehicles.

B. For the purposes of this section, "heavy-duty rotator recovery vehicle" means a tow vehicle that has all of the following:

A manufacturer's gross vehicle weight rating in excess of fifty-two thousand pounds.
A boom that is capable of moving its position to the side of the vehicle to perform recoveries and that has a boom rating of at least forty tons.
Air brakes that are capable of providing air to the towed vehicle's brakes.

Chapter 12.1 Emergency Medical Services

Article 1 General Provisions

§ 41-1831 Definitions

In this chapter, unless the context otherwise requires:

"Ambulance" means any publicly or privately owned surface, water or air vehicle, including a helicopter, that is specially designed and constructed or modified and equipped to be used, maintained or operated for transportation of individuals who are sick, injured, wounded or otherwise incapacitated or helpless. Ambulance does not include surface vehicles owned and operated by a private sole proprietor, partnership, private corporation or municipal corporation for the emergency transportation or in transit care of its employees.
"Ambulance pilot" means an individual who is responsible for the operation of an air ambulance and who is trained and certified as provided in this chapter.
"Ambulance service" means a person who owns and operates one or more ambulances.
"Emergency medical care technician" means an individual who has been certified by the department of health services as an emergency medical technician, an advanced emergency medical technician, an emergency medical technician I-99 or a paramedic.
"Department" means the department of public safety.
"Director" means the director of the department of public safety.
"Emergency medical patient" means a person who is suffering from a condition that requires immediate medical care or hospitalization, or both, in order to preserve the person's health, life or limb.
"Emergency medical services communication system" means the statewide system implemented, coordinated and administered by the department of public safety, which may have the capability of providing for the intercommunication of any or all law enforcement agencies and personnel, ambulances, ambulance services and dispatchers, emergency receiving facilities, other health care institutions, medical practitioners, motor vehicle repair, fire service vehicles and tow trucks, and any other agencies and persons who may be serving on a volunteer basis.
"Emergency medical situation" means a condition of emergency in which immediate medical care or hospitalization, or both, is required by a person or persons for the preservation of health, life or limb.
"Emergency receiving facility" means a licensed health care institution that offers emergency medical services, that is staffed twenty-four hours a day and that has a physician who is licensed pursuant to title 32, chapter 13 or 17, on call.

§ 41-1832 Exemption from regulation

A. Notwithstanding any other statute, persons engaged in and vehicles used for the emergency transportation of persons injured at an industrial site are exempt from the provisions of this chapter.

B. Persons engaged in and vehicles used for air transportation of sick or injured people in a noncritical or nonemergency situation as determined by a physician are exempt from the provisions of this chapter.

§ 41-1833 Powers and duties of the director

A. The director shall:

Subject to the law enforcement merit system council classifications and pay scales, appoint, define the duties and prescribe the terms and conditions of employment of all employees necessary to carry out the purposes of this chapter.
Adopt rules necessary for carrying out the purposes of this chapter.
Cooperate with the state director of emergency management when a state of emergency or a state of war emergency has been declared by the governor.

B. The director may:

Request the cooperation of utilities, communications media and public and private agencies to aid and assist in the implementation and maintenance of departmental components of the statewide emergency medical services system.
Cooperate with any agency or group which provides a similar program of emergency medical services in a contiguous state.
Enter into contracts and agreements for the acquisition and purchase of any equipment, tools, supplies and materials necessary in the administration of this chapter.
Accept and expend federal funds and private grants, gifts, contributions and devises to assist in carrying out the purposes of this chapter. Such funds shall not revert to the state general fund at the close of a fiscal year.

§ 41-1834 Authority for operation of air and other ambulance service; contract for aircraft service; precluded uses

A. For the primary purpose of providing the most timely, efficient and comprehensive emergency medical services possible, the director may, subject to the availability of funds, purchase, equip, staff and be responsible for maintaining aircraft, including helicopters, or may lease or contract for such equipment and services. Aircraft and helicopters shall also be used in law enforcement activities. The aircraft provided by this section may be made available for emergency medical services at any time there is a medical emergency requiring the use of evacuation aircraft, as determined by a law enforcement agency or a physician. Emergency medical air evacuation shall normally take precedence over routine law enforcement missions. The director shall make the final decision relative to such aircraft utilization.

B. Each medical evacuation aircraft or helicopter shall be capable of carrying two litter patients and one paramedic in addition to the ambulance pilot.

C. The director may contract with a private firm, a corporation or an individual for the maintenance of the aircraft, including helicopters.

D. The director may enter into contracts with private firms or individuals for emergency surface or air ambulance services when no other such services are readily available or when deemed to be in the best interests of the state.

E. Medical evacuation aircraft, including helicopters, operated by the department shall not be used to provide transportation for officials of the state or any of its political subdivisions. This does not preclude the use of medical evacuation aircraft by such officials when required in the course of a law enforcement function or emergency or when such official is the victim of an emergency medical situation.

F. Notwithstanding subsection E, the director may enter into interagency service agreements with other state agencies for the use of helicopters and other aircraft that the department will operate to provide aviation services on an availability basis when the department deems that these services are in the best interests of this state. These services may be in addition to the services the department provides pursuant to this chapter but shall not preclude the delivery of emergency evacuation services provided for under this chapter. The amount of monies collected from state agencies for aviation services shall not exceed the operational costs of the aircraft.

§ 41-1835 Implementation and coordination of an emergency medical services communication system

A. The director is responsible for the overall design, installation, maintenance, implementation, coordination and administration of a statewide emergency medical services communication system, as defined in section 41-1831, subject to the availability of funds, and for the establishment of any of such services deemed necessary.

B. All emergency medical communications systems shall be approved by the department in accordance with the statewide emergency medical services communication system plan to insure system compatibility.

C. The director may also institute programs for implementing the voluntary cooperation of the private sector in locating and reporting accidents, both on and off the highways.

D. The director is responsible for submitting a communications plan, excluding a budgetary component, for the annual statewide emergency medical services plan to the director of the department of health services.

§ 41-1837 Financial responsibility for emergency medical services rendered to indigents

A. If an indigent emergency medical patient is received by an emergency receiving facility from an ambulance with necessary medical equipment and supplies to provide emergency medical services and which is licensed pursuant to title 36, chapter 21.1, the county is liable pursuant to section 11-297.02 to the ambulance service for the cost of transporting the patient and to the facility for the reasonable costs of all medical services rendered to the patient by the facility until the patient is transferred by the county to the county hospital, or some other facility designated by the county.

B. This section does not apply to air ambulances, including ambulance helicopters, operated by the department. There shall be no charge made to the patient for any emergency medical care provided by department personnel.

Article 2 Ambulances and Ambulance Personnel

§ 41-1841 Standards for ambulances

The director of the department of health services shall adopt minimum reasonable standards and procedures pursuant to title 36, chapter 21.1 for the issuance of a license to operate a ground or air vehicle as an ambulance. Such standards may differ in counties of over three hundred thousand population from counties of lesser population.

§ 41-1842 Violation; classification

Any person violating or failing to comply with any provision of this chapter is guilty of a class 1 misdemeanor.

§ 41-1843 Construction of article; authority of corporation commission

This article shall not be construed to limit the authority of the corporation commission to regulate ambulance service corporations pursuant to article XV, Constitution of Arizona.

§ 41-1848 First responder course

The department is responsible for implementing the first responder course approved pursuant to section 36-2204 for law enforcement officers.

Article 3 Arizona Fallen Firefighter Memorial

§ 41-1861 Arizona fallen firefighter memorial committee; membership

A. The Arizona fallen firefighter memorial committee is established consisting of the following members:

The president of this state's largest professional firefighters organization who shall serve as the chairperson of the committee.
One public member who is appointed by the chairperson of the committee.
The state forester or the state forester's designee.
The director of the historical advisory commission or the director's designee.
The director of the department of administration or the director's designee.
The commander of a professional firefighters organization honor guard.
The president of the Arizona fire chiefs association.
Two public members who are appointed by the governor.

B. Members of the committee are not eligible to receive compensation, but members are entitled to reimbursement from the Arizona fallen firefighter memorial fund established by section 41-1863 for reasonable expenses in traveling on and attending to official committee business.

§ 41-1862 Arizona fallen firefighter memorial committee; powers and duties; subcommittee

A. The Arizona fallen firefighter memorial committee shall:

Establish an acceptable set of standards for persons to be memorialized on the Arizona fallen firefighter memorial that is located in Wesley Bolin Plaza.
Determine those persons who are eligible to be memorialized.
Plan and provide for additions to and maintenance of the Arizona fallen firefighter memorial on an annual basis.
Solicit private monetary donations or public monies from municipalities for deposit in the Arizona fallen firefighter memorial fund.
Conduct an annual fallen firefighter memorial service.
Determine those persons who are eligible for the tuition waiver scholarship pursuant to section 15-1808 and report the determination to the governor's office and Arizona board of regents or to each community college district governing board, as applicable.

B. The committee may establish a subcommittee that is appointed by the committee chairperson to receive applications from and recommend tuition waiver scholarships for persons who are eligible for the tuition waiver scholarship pursuant to section 15-1808. The subcommittee shall forward any recommendation for a tuition waiver scholarship to the committee for approval.

C. The committee shall meet every January and May. The committee may conduct additional meetings in person or telephonically.

§ 41-1863 Arizona fallen firefighter memorial fund

A. The Arizona fallen firefighter memorial fund is established. The fund shall consist of monies received as donations as provided for in this article. On notice from the committee, the state treasurer shall invest and divest monies in the Arizona fallen firefighter memorial fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. The monies in the fund are exempt from section 35-190, relating to lapsing of appropriations.

B. The state treasurer shall pay the costs and expenses authorized by this article from the monies available in the Arizona fallen firefighter memorial fund on certification to the state treasurer by the chairperson of the Arizona fallen firefighter memorial committee that the amount requested is owed for a valid purpose.

Chapter 13 Commission on Salaries for Elective State Officers

Article 1 General Provisions

§ 41-1901 Establishment of commission

There is established a commission to be known as the commission on salaries for elective state officers, hereinafter referred to as the commission.

§ 41-1902 Membership; terms; vacancies; compensation

A. The commission is composed of five members, who shall be appointed from private life, as follows:

Two by the governor, one of whom shall be designated as chairman by the governor.
One by the president of the senate.
One by the speaker of the house of representatives.
One by the chief justice of the supreme court.

B. Beginning in 2002, members shall be appointed biennially and serve until they have submitted the report made pursuant to section 41-1903.

C. Any vacancy in the membership shall be filled in the manner in which the original appointment was made.

D. The members of the commission shall serve without compensation, but shall be reimbursed for travel and subsistence expenses as provided by law for state officers. The department of administration, personnel division shall provide the commission with such staff as is necessary to perform its functions and shall provide record-keeping facilities and other facilities as needed.

§ 41-1903 Function

A. Beginning in 2002, the commission shall biennially conduct a review of the rates of pay of elective state officers, of justices and judges of courts of record and of clerks of the superior court. Such review by the commission shall be made for the purpose of determining and providing the pay levels appropriate to the duties and responsibilities of the respective offices and positions subject to such review. The commission may hold public hearings to aid it in its work.

B. The commission shall submit to the governor no later than June 1 a report of the results of each review conducted by the commission of the offices and positions subject to this chapter, together with its recommendations.

§ 41-1904 Recommendations

A. The governor shall include, in the budget next transmitted by him to the legislature after the date of the submission of the report and recommendations of the commission, his own recommendations with respect to the exact rates of pay which he deems advisable for those offices and positions subject to this chapter.

B. All or part, as the case may be, of the recommendations of the governor transmitted to the legislature in the budget relating to salaries shall become effective on the first Monday of January of the next calendar year following the transmittal of his recommendations in the budget, but only to the extent that between the date of transmittal of such recommendations in the budget and the ninetieth day following the transmittal of his recommendations:

No statute has been enacted which establishes rates of pay other than those proposed by all or part of such recommendations.
Neither house of the legislature specifically disapproves all or part of such recommendations. In case of either of a legislative enactment or disapproval by either house, the recommendations are effective only insofar as not altered or disapproved.

C. Any part of the recommendations of the governor may, in accordance with express provisions of express recommendations, be made operative on a date later than the date on which such recommendations otherwise would take effect.

D. The recommendations of the commission as to legislative salaries shall be certified by it to the secretary of state and the secretary of state shall submit to the qualified electors at the next regular general election the question, "Shall the recommendations of the commission on salaries for elective state officers concerning legislative salaries be accepted? Yes // No //". Such recommendations if approved by the electors shall become effective at the beginning of the next regular legislative session without any other authorizing legislation.

E. The recommendations of the governor transmitted to the legislature under this chapter shall, upon their effective date, supersede all provisions of law in conflict therewith. The recommendations of the governor which do take effect shall be published with the laws of the state.

Chapter 14 Department of Economic Security

Article 1 General Provisions

§ 41-1951 Definitions

In this chapter, unless the context otherwise requires:

"Agency" includes one or more of the state agencies consolidated into the department of economic security by this chapter.
"Comprehensive plan" means an evaluation of client needs and the availability of services to meet these needs within the state.
"Council" means the economic security council.
"Department" means the department of economic security.
"Director" means the director of the department of economic security.
"State plan" means any of the several state plans which establish the federal-state contractual relationships necessary for federal funding.
"Community work and training" means work, training or job development which will be provided through a plan jointly entered into by the department and an agency, department, board or commission of the state or federal government, county, city, political subdivision or private agency. Such work, training or job development will take place in and about public or private works or improvements and will utilize labor and services required to be performed where feasible by those eligible for this program.

§ 41-1952 Department of economic security; director; appointment; compensation

A. A department of economic security is established.

B. The direction, operation and control of the department are the responsibility of the director.

C. The director shall be appointed by the governor pursuant to section 38-211 and shall serve at the pleasure of the governor.

D. Compensation for the director shall be established pursuant to section 38-611.

§ 41-1953 Department organization; deputy director; assistant directors

A. The director may establish, abolish or reorganize the positions or organizational units within the department to carry out the functions provided by section 41-1954, subject to legislative appropriation, if in the director's judgment the modification of organization would make the operation of the department more efficient, effective or economical. The director or the director's deputy shall enforce cooperation among the divisions in the provision and integration of all functions on the district and local level.

B. The director shall appoint a deputy director of the department with the advice and consent of the governor. The deputy director shall serve at the pleasure of the director. The deputy director shall be directly responsible for the operation and coordination of those services of the department concerning initial intake, screening, evaluation and referral of persons served by the department.

C. The director shall appoint an assistant director to head each organizational unit that the director may establish. Each assistant director shall serve at the pleasure of the director.

D. To the maximum extent possible, the director shall establish separate investigation units for the purpose of investigating allegations of dependency, abuse and neglect according to protocols established pursuant to section 8-817.

E. The department succeeds to the authority, powers, duties and responsibilities of the following:

The employment security commission of Arizona and its Arizona state employment service, unemployment compensation and administrative service divisions.
The state department of public welfare.
The division of vocational rehabilitation.
The state office of economic opportunity.
The state office of manpower planning.
The state department of mental retardation.

F. In the statutes, references to the agencies and departments listed in subsection E shall be deemed to be references to the department of economic security or its appropriate divisions, offices or organizational units.

§ 41-1954 Powers and duties

A. In addition to the powers and duties of the agencies listed in section 41-1953, subsection E, the department shall:

Administer the following services:

(a) Employment services, including manpower programs and work training, field operations, technical services, unemployment compensation, community work and training and other related functions in furtherance of programs under the social security act, as amended, the Wagner-Peyser act, as amended, the federal unemployment tax act, as amended, 33 United States Code, the family support act of 1988 (P.L. 100-485) and other related federal acts and titles.

(b) Individual and family services, which shall include a section on aging, services to children, youth and adults and other related functions in furtherance of social service programs under the social security act, as amended, title IV, except parts B and E, grants to states for aid and services to needy families with children and for child welfare services, title XX, grants to states for services, the older Americans act, as amended, the family support act of 1988 (P.L. 100-485) and other related federal acts and titles.

(c) Income maintenance services, including categorical assistance programs, special services unit, child support collection services, establishment of paternity services, maintenance and operation of a state case registry of child support orders, a state directory of new hires, a support payment clearinghouse and other related functions in furtherance of programs under the social security act, title IV, grants to states for aid and services to needy families with children and for child welfare services, title XX, grants to states for services, as amended, and other related federal acts and titles.

(d) Rehabilitation services, including vocational rehabilitation services and sections for the blind and visually impaired, communication disorders, correctional rehabilitation and other related functions in furtherance of programs under the vocational rehabilitation act, as amended, the Randolph-Sheppard act, as amended, and other related federal acts and titles.

(e) Administrative services, including the coordination of program evaluation and research, interagency program coordination and in-service training, planning, grants, development and management, information, legislative liaison, budget, licensing and other related functions.

(f) Manpower planning, including a state manpower planning council for the purposes of the federal-state-local cooperative manpower planning system and other related functions in furtherance of programs under the comprehensive employment and training act of 1973, as amended, and other related federal acts and titles.

(g) Economic opportunity services, including the furtherance of programs prescribed under the economic opportunity act of 1967, as amended, and other related federal acts and titles.

(h) Intellectual disability and other developmental disability programs, with emphasis on referral and purchase of services. The program shall include educational, rehabilitation, treatment and training services and other related functions in furtherance of programs under the developmental disabilities services and facilities construction act (P.L. 91-517) and other related federal acts and titles.

(i) Nonmedical home and community based services and functions, including department-designated case management, housekeeping services, chore services, home health aid, personal care, visiting nurse services, adult day care or adult day health, respite sitter care, attendant care, home delivered meals and other related services and functions.

Provide a coordinated system of initial intake, screening, evaluation and referral of persons served by the department.
Adopt rules it deems necessary or desirable to further the objectives and programs of the department.
Formulate policies, plans and programs to effectuate the missions and purposes of the department.
Employ and determine the conditions of employment and prescribe the duties and powers of administrative, professional, technical, secretarial, clerical and other persons subject to chapter 4, article 4 and, as applicable, article 5 of this title as may be necessary in the performance of its duties, contract for the services of outside advisors, consultants and aides as may be reasonably necessary and reimburse department volunteers, designated by the director, for expenses in transporting clients of the department on official business.
Make contracts and incur obligations within the general scope of its activities and operations subject to the availability of funds.
Contract with or assist other departments, agencies and institutions of the state, local and federal governments in the furtherance of its purposes, objectives and programs.
Be designated as the single state agency for the purposes of administering and in furtherance of each federally supported state plan.
Accept and disburse grants, matching funds and direct payments from public or private agencies for the conduct of programs that are consistent with the overall purposes and objectives of the department.
Provide information and advice on request by local, state and federal agencies and by private citizens, business enterprises and community organizations on matters within the scope of its duties subject to the departmental rules on the confidentiality of information.
Establish and maintain separate financial accounts as required by federal law or regulations.
Advise and make recommendations to the governor and the legislature on all matters concerning its objectives.
Have an official seal that is judicially noticed.
Annually estimate the current year's population of each county, city and town in this state, using the periodic census conducted by the United States department of commerce, or its successor agency, as the basis for such estimates and deliver such estimates to the economic estimates commission before December 15.
Estimate the population of any newly annexed areas of a political subdivision as of July 1 of the fiscal year in which the annexation occurs and deliver such estimates as promptly as is feasible after the annexation occurs to the economic estimates commission.
Establish and maintain a statewide program of services for persons who are both hearing impaired and visually impaired and coordinate appropriate services with other agencies and organizations to avoid duplication of these services and to increase efficiency. The department of economic security shall enter into agreements for the utilization of the personnel and facilities of the department of economic security, the department of health services and other appropriate agencies and organizations in providing these services.
Establish and charge fees for deposit in the department of economic security prelayoff assistance services fund to employers who voluntarily participate in the services of the department that provide job service and retraining for persons who have been or are about to be laid off from employment. The department shall charge only those fees necessary to cover the costs of administering the job service and retraining services.
Establish a focal point for addressing the issue of hunger in this state and provide coordination and assistance to public and private nonprofit organizations that aid hungry persons and families throughout this state. Specifically such activities shall include:

(a) Collecting and disseminating information regarding the location and availability of surplus food for distribution to needy persons, the availability of surplus food for donation to charity food bank organizations, and the needs of charity food bank organizations for surplus food.

(b) Coordinating the activities of federal, state, local and private nonprofit organizations that provide food assistance to the hungry.

(c) Accepting and disbursing federal monies, and any state monies appropriated by the legislature, to private nonprofit organizations in support of the collection, receipt, handling, storage and distribution of donated or surplus food items.

(d) Providing technical assistance to private nonprofit organizations that provide or intend to provide services to the hungry.

(e) Developing a state plan on hunger that, at a minimum, identifies the magnitude of the hunger problem in this state, the characteristics of the population in need, the availability and location of charity food banks and the potential sources of surplus food, assesses the effectiveness of the donated food collection and distribution network and other efforts to alleviate the hunger problem, and recommends goals and strategies to improve the status of the hungry. The state plan on hunger shall be incorporated into the department's state comprehensive plan prepared pursuant to section 41-1956.

(f) Establishing a special purpose advisory council on hunger pursuant to section 41-1981.

Establish an office to address the issue of homelessness and to provide coordination and assistance to public and private nonprofit organizations that prevent homelessness or aid homeless individuals and families throughout this state. These activities shall include:

(a) Promoting and participating in planning for the prevention of homelessness and the development of services to homeless persons.

(b) Identifying and developing strategies for resolving barriers in state agency service delivery systems that inhibit the provision and coordination of appropriate services to homeless persons and persons in danger of being homeless.

(c) Assisting in the coordination of the activities of federal, state and local governments and the private sector that prevent homelessness or provide assistance to homeless people.

(d) Assisting in obtaining and increasing funding from all appropriate sources to prevent homelessness or assist in alleviating homelessness.

(e) Serving as a clearinghouse on information regarding funding and services available to assist homeless persons and persons in danger of being homeless.

(f) Developing an annual state comprehensive homeless assistance plan to prevent and alleviate homelessness.

(g) Submitting an annual report to the governor, the president of the senate and the speaker of the house of representatives on the status of homelessness and efforts to prevent and alleviate homelessness. The department shall provide a copy of this report to the secretary of state.

Cooperate with the Arizona-Mexico commission in the governor's office and with researchers at universities in this state to collect data and conduct projects in the United States and Mexico on issues that are within the scope of the department's duties and that relate to quality of life, trade and economic development in this state in a manner that will help the Arizona-Mexico commission to assess and enhance the economic competitiveness of this state and of the Arizona-Mexico region.
Exchange information, including case specific information, and cooperate with the department of child safety for the administration of the department of child safety's programs.

B. If the department of economic security has responsibility for the care, custody or control of a child or is paying the cost of care for a child, it may serve as representative payee to receive and administer social security and United States department of veterans affairs benefits and other benefits payable to such child. Notwithstanding any law to the contrary, the department of economic security:

Shall deposit, pursuant to sections 35-146 and 35-147, such monies as it receives to be retained separate and apart from the state general fund on the books of the department of administration.
May use such monies to defray the cost of care and services expended by the department of economic security for the benefit, welfare and best interests of the child and invest any of the monies that the director determines are not necessary for immediate use.
Shall maintain separate records to account for the receipt, investment and disposition of funds received for each child.
On termination of the department of economic security's responsibility for the child, shall release any funds remaining to the child's credit in accordance with the requirements of the funding source or in the absence of such requirements shall release the remaining funds to:

(a) The child, if the child is at least eighteen years of age or is emancipated.

(b) The person responsible for the child if the child is a minor and not emancipated.

C. Subsection B of this section does not pertain to benefits payable to or for the benefit of a child receiving services under title 36.

D. Volunteers reimbursed for expenses pursuant to subsection A, paragraph 5 of this section are not eligible for workers' compensation under title 23, chapter 6.

E. In implementing the temporary assistance for needy families program pursuant to Public Law 104-193, the department shall provide for cash assistance to two-parent families if both parents are able to work only on documented participation by both parents in work activities described in title 46, chapter 2, article 5, except that payments may be made to families who do not meet the participation requirements if:

It is determined on an individual case basis that they have emergency needs.
The family is determined to be eligible for diversion from long-term cash assistance pursuant to title 46, chapter 2, article 5.

F. The department shall provide for cash assistance under temporary assistance for needy families pursuant to Public Law 104-193 to two-parent families for no longer than six months if both parents are able to work, except that additional assistance may be provided on an individual case basis to families with extraordinary circumstances. The department shall establish by rule the criteria to be used to determine eligibility for additional cash assistance.

G. The department shall adopt the following discount medical payment system for persons who the department determines are eligible and who are receiving rehabilitation services pursuant to subsection A, paragraph 1, subdivision (d) of this section:

For inpatient hospital admissions and outpatient hospital services the department shall reimburse a hospital according to the rates established by the Arizona health care cost containment system administration pursuant to section 36-2903.01, subsection G.
The department's liability for a hospital claim under this subsection is subject to availability of funds.
A hospital bill is considered received for purposes of paragraph 5 of this subsection on initial receipt of the legible, error-free claim form by the department if the claim includes the following error-free documentation in legible form:

(a) An admission face sheet.

(b) An itemized statement.

(d) A discharge summary or an interim summary if the claim is split.

(e) An emergency record, if admission was through the emergency room.

(f) Operative reports, if applicable.

(g) A labor and delivery room report, if applicable.

The department shall require that the hospital pursue other third-party payors before submitting a claim to the department. Payment received by a hospital from the department pursuant to this subsection is considered payment by the department of the department's liability for the hospital bill. A hospital may collect any unpaid portion of its bill from other third-party payors or in situations covered by title 33, chapter 7, article 3.
For inpatient hospital admissions and outpatient hospital services rendered on and after October 1, 1997, if the department receives the claim directly from the hospital, the department shall pay a hospital's rate established according to this section subject to the following:

(a) If the hospital's bill is paid within thirty days of the date the bill was received, the department shall pay ninety-nine percent of the rate.

(b) If the hospital's bill is paid after thirty days but within sixty days of the date the bill was received, the department shall pay one hundred percent of the rate.

(c) If the hospital's bill is paid any time after sixty days of the date the bill was received, the department shall pay one hundred percent of the rate plus a fee of one percent per month for each month or portion of a month following the sixtieth day of receipt of the bill until the date of payment.

For medical services other than those for which a rate has been established pursuant to section 36-2903.01, subsection G, the department shall pay according to the Arizona health care cost containment system capped fee-for-service schedule adopted pursuant to section 36-2904, subsection K or any other established fee schedule the department determines reasonable.

H. The department shall not pay claims for services pursuant to this section that are submitted more than nine months after the date of service for which the payment is claimed.

I. To assist in the location of persons or assets for the purpose of establishing paternity, establishing, modifying or enforcing child support obligations and other related functions, the department has access, including automated access if the records are maintained in an automated database, to records of state and local government agencies, including:

Vital statistics, including records of marriage, birth and divorce.
State and local tax and revenue records, including information on residence address, employer, income and assets.
Records concerning real and titled personal property.
Records of occupational and professional licenses.
Records concerning the ownership and control of corporations, partnerships and other business entities.
Employment security records.
Records of agencies administering public assistance programs.
Records of the motor vehicle division of the department of transportation.
Records of the state department of corrections.
Any system used by a state agency to locate a person for motor vehicle or law enforcement purposes, including access to information contained in the Arizona criminal justice information system.

J. Notwithstanding subsection I of this section, the department or its agents shall not seek or obtain information on the assets of an individual unless paternity is presumed pursuant to section 25-814 or established.

K. Access to records of the department of revenue pursuant to subsection I of this section shall be provided in accordance with section 42-2003.

L. The department also has access to certain records held by private entities with respect to child support obligors or obligees, or individuals against whom such an obligation is sought. The information shall be obtained as follows:

In response to a child support subpoena issued by the department pursuant to section 25-520, the names and addresses of these persons and the names and addresses of the employers of these persons, as appearing in customer records of public utilities, cable operators and video service providers.
Information on these persons held by financial institutions.

M. Pursuant to department rules, the department may compromise or settle any support debt owed to the department if the director or an authorized agent determines that it is in the best interest of this state and after considering each of the following factors:

The obligor's financial resources.
The cost of further enforcement action.
The likelihood of recovering the full amount of the debt.

N. Notwithstanding any law to the contrary, a state or local governmental agency or private entity is not subject to civil liability for the disclosure of information made in good faith to the department pursuant to this section.

§ 41-1954.01 Electronic communication by department; applicability

A. Notwithstanding any law to the contrary, any agency, division, program or part of the department or its agents that are required to provide administrative orders, notices, decisions or letters to an applicant, claimant, recipient, employer or client may send administrative orders, notices, decisions or letters by electronic means if the party being served or notified consents.

B. Consent may be obtained in writing on a form approved by the department, verbally on the record in a hearing or electronically through the department's website by the applicant, claimant, recipient, employer or client following an affirmative consent procedure. At the time of consent, the party must be advised of the nature of the notices to be delivered or served, the legal consequence of the choice and the right to revoke the consent. Consent may be provided for a proceeding or for notices provided on an ongoing basis.

C. Delivery or service by electronic means is complete on transmission unless it is established that delivery or transmission of the electronic document failed due to department error or failure of the recipient to receive the electronic document for any other reason outside the control of the recipient.

D. Consent may be revoked in writing to the department or by following an affirmative revocation procedure established on the department's website.

E. If the department receives electronic notice that the electronic address to which the administrative order, notice, decision or letter is being sent is no longer valid or is otherwise not functioning, the department shall deem the consent to electronic notice to have been revoked and the order, notice, decision or letter shall be served by mail.

F. This section is limited to notices, decisions and orders required for services and programs in the division of benefits and medical eligibility, the division of child support enforcement and the division of employment and rehabilitation services, or their successor divisions, in the department. This section does not apply to a notice that is required in connection with litigation before a court of record in this state.

§ 41-1955 Duty of department concerning employment stabilization, ex-offender rehabilitation, income maintenance and manpower development; research studies

The department, with the advice and aid of its advisory councils, shall:

Take appropriate steps to reduce and prevent unemployment and dependency, and to assist in alleviating the economic and social impact of unemployment and dependency on the person and his family.
Encourage and assist in the adoption of practical methods of manpower services, occupational training, vocational counseling and guidance, vocational rehabilitation and retraining, supportive services and other such services the director deems appropriate.
Research, recommend, advise and assist in the establishment of community or area facilities, public and private, or both, to provide an integration of direct services and programs for the development of the state's manpower and the reduction of dependency.
Promote the effective utilization of unemployed and under-utilized workers.
Aid in the rehabilitation of employable ex-offenders, in cooperation with the department of corrections. An ex-offender, by accepting the assistance provided for by this article, shall not be disqualified from receiving further assistance from any other state agency to which he is legally entitled.
Be the state registration agency for apprenticeship functions prescribed by the federal government.
Carry out and publish the results of research studies for the purpose of this chapter.

§ 41-1956 State comprehensive plan

The department shall annually prepare a comprehensive plan for the state for the purpose of guiding the development, funding and implementation of programs and activities by the department and other state programs concerned with service development, integration and utilization. The plan shall describe the present and projected needs for development of such programs and set forth the long-range program objectives. The plan shall also include a description of the content and allocation of state and federal funds to all programs, services and activities to be carried out under the plan during the year. The department shall indicate how and to what extent such programs, services and activities will carry out the program objectives set forth in the long-range program plan. The department shall hold public hearings on the plan before adoption of such plan.

§ 41-1957 State-federal cooperation

A. Subject to the departmental rules and regulations on the confidentiality of information, upon request, the department shall furnish to any agency of the United States which is charged with the administration of public works or assistance through public employment the name, address, ordinary occupation and employment status of each recipient of benefits and the recipient's rights to further benefits from programs administered by the department.

B. In the administration of the provisions of the extended benefit program required by the federal-state extended unemployment compensation act of 1970, the department shall take such action as may be necessary to ensure that the provisions are so interpreted and applied as to meet the requirements of such federal act as interpreted by the United States department of labor, and to secure to this state the full reimbursement of the federal share of extended benefits paid under title 23, chapter 4, that are reimbursable under the federal act.

§ 41-1958 Acquisition of lands and buildings; lease-purchase agreements; lease or sublease of lands or buildings

A. The director may acquire for and in the name of this state by lease, lease-purchase agreement or otherwise lands or buildings for the purpose of providing office space for the department at such places as the director finds necessary and suitable.

B. An agreement made for the lease, lease-purchase or purchase of the premises mentioned in subsection A of this section is subject to the approval of the attorney general and the director of the department of administration.

C. An agreement made for the purchase of the premises mentioned in subsection A of this section is subject to the review of the joint committee on capital review.

D. Any lease-purchase agreement relating to land or building acquisitions shall provide that:

The obligation of this state to make any payment under the agreement is a current expense of the department and is not a general obligation indebtedness of this state or the department.
If the legislature fails to appropriate monies or the department fails to allocate monies for any periodic payment or renewal term of the agreement, the agreement terminates at the end of the current term and this state and the department are relieved of any subsequent obligation under the agreement.
The joint committee on capital review shall review the project before the lease-purchase agreement takes effect.

E. The director may lease or sublease at fair rental value any land or building that is acquired pursuant to subsection A of this section. The director may lease or sublease any building that is acquired pursuant to subsection A of this section on other terms or conditions if the lessee is a state entity or political subdivision of this state. All net lease income shall be credited to the department's occupancy appropriation.

F. A lease or sublease that is granted pursuant to subsection E of this section is exempt from the provisions of section 41-2752 and is not subject to chapter 23 of this title. The director may prioritize lease or sublease tenants based on the needs of the department and in the public interest with preference given to the following in the order provided:

State entities.
Political subdivisions.
Community partners.

G. The department may pay or advance gross initial and routine lease and sublease related expenditures. The gross initial and routine expenditures that are paid or advanced shall be reimbursed to the department before the net lease income is credited to the department's occupancy appropriation pursuant to subsection E of this section.

H. Any agreement under this section shall comply with the constitution and other laws of this state.

§ 41-1959 Confidential information; permissible disclosure; rules; violation; classification

A. Unless otherwise provided by law, all personally identifiable information concerning any applicant, claimant, recipient, employer or client is confidential and shall not be released unless ordered by a superior court judge or provided for by rule of court except as provided in subsections B, C and D of this section. Department records and files that contain information related to investigations conducted by child protective services or the department of child safety are confidential. The department shall release this information only as prescribed by section 8-807.

B. Employees of the department of economic security, the department of law and the court may obtain the information described in subsection A of this section in the performance of their duties as authorized by rules adopted by the director.

C. Employees of the department of economic security, the department of law and the court may release any information that is otherwise held confidential under this section under any of the following circumstances:

To the applicant, claimant, recipient, employer or client if a request is made in writing by any of such persons specifically requesting information that directly relates to the person requesting such information.
To the extent necessary to make claims on behalf of a client for public or private assistance, insurance or health or medical assistance pursuant to title 11, chapter 2, article 7 or title 36, chapter 29 to which the client may be entitled.
In oral and written communications involving the provision of services or the referral to services between employees of, persons under contract with, or persons holding a general employment relationship with the department of economic security, the department of law or the juvenile court.
If the disclosure of otherwise confidential information is necessary to protect against a clear and substantial risk of imminent serious injury to a client.
To agencies of the federal government, a state, a political subdivision of any state or a tribal government for official purposes. All information received by a governmental agency pursuant to this paragraph shall be maintained as confidential, except where pertinent to a criminal prosecution.
To foster parents and persons certified to adopt if necessary to assist in the placement with or care of a child by such persons.
In any judicial or administrative proceeding involving an adult protective services client if the director of the department considers the information pertinent to the proceeding.
To the entities as specified in section 23-722.04, subsections A and E for the development of a state workforce evaluation data system and program performance purposes and other program and research purposes as defined in a data sharing agreement but not including information regarding adult or child protection actions.

D. Notwithstanding section 46-135, a standing committee of the legislature or a committee appointed by the president of the senate or the speaker of the house of representatives may obtain the information described in subsection A of this section on written notification to the director. Information obtained pursuant to this subsection may be used only for purposes of conducting investigations related to legislative oversight of the department. Information that is personally identifiable shall not be further disclosed.

E. Any violation of this section is a class 2 misdemeanor.

F. The department shall establish safeguards against the unauthorized use or disclosure of confidential information in title IV-D cases.

§ 41-1960 Annual report

The director shall make an annual report of the state's economic security needs and resources, including the use, training and placement of manpower, and his recommendations for the forthcoming fiscal year for the state's development of relevant programs. Such report shall be transmitted to the governor and legislature by the end of each calendar year.

§ 41-1960.01 Enforcement of child support; report

The department of economic security shall implement and evaluate programs that are designed to test the effectiveness of private sector involvement in title IV-D child support collections enforcement. The department of economic security shall report to the legislature on the status of these programs by November 30 of each year.

§ 41-1961 District offices; location; representatives

A. The department shall establish at least six district offices, to be located in and serve the various related geographical areas of the state. The districts shall have common boundaries for all services provided by the department.

B. Each district office shall be staffed by a representative from each major organizational service unit of the department. One of the representatives shall be designated by the director to coordinate the district office.

C. Each district office shall be considered an operations unit of the department and shall be responsible for the planning, programs, intra and interagency coordination within the district area.

D. Each district office shall be created in addition to any local offices of the department that may exist in the district area.

§ 41-1962 Conflict with federal law

Where any conflict with federal law occurs concerning the programs and functions of the department as established by the law of this state, such federal law shall control. For purposes of this section, "federal law" means any statute passed by the Congress of the United States, any final regulations adopted by any administrative agency of the United States government and published in the Code of Federal Regulations or the federal register or any final decision of the federal judiciary. A conflict between federal law and the law of this state does not exist for purposes of this section unless the source of the federal law, on its face or so clearly as not to require any additional interpretation, establishes the conflict. Upon notification of a conflict with federal law where the conflict does not meet the requirements of this section, the department may conform its programs and functions to eliminate the alleged conflict on condition that the department contest the alleged conflict.

§ 41-1963 Prosecution authority

The attorney general and the appropriate county attorney shall have concurrent jurisdiction to prosecute all violations of law arising out of or in connection with any program administered by the department, including, but not limited to, sections 13-3701, 23-657 and 46-215.

§ 41-1964 Day care homes; child care personnel; fingerprints; definition

A. Child care personnel shall have valid fingerprint clearance cards issued pursuant to section 41-1758.07 before being certified by the department or residing or working in the home of a child care home provider or being designated as a backup provider.

B. Before certification or within seven working days after residing or working in the home of a child care provider or being designated as a backup provider, child care personnel shall certify on forms that are provided by the department and notarized whether:

They are awaiting trial on or have been convicted of or admitted committing any of the criminal offenses listed in section 41-1758.07, subsections B and C in this state or similar offenses in another state or jurisdiction.
They are parents or guardians of a child adjudicated to be a dependent child as defined in section 8-201.
They have been denied a license to operate a facility for the care of children for cause in this state or another state or had a license or certificate to operate such a facility revoked.

C. The department shall make documented, good faith efforts to contact previous employers of certified day care home personnel to obtain information or recommendations that may be relevant to an individual's fitness for work in a certified day care home.

D. The notarized forms are confidential.

E. The department of economic security shall notify the department of public safety if the department of economic security receives credible evidence that any child care personnel who possesses a valid fingerprint clearance card either:

Is arrested for or charged with an offense listed in section 41-1758.07, subsection B or C.
Falsified information on the form required by subsection B of this section.

F. For the purposes of this section, "child care personnel" means child care home providers, in-home providers and noncertified relative providers as defined in section 46-801 and designated backup providers and all persons who are eighteen years of age or older and who work or reside in the home of a child care home provider.

§ 41-1965 Eligibility of lottery prize winner to receive assistance; determination

On receipt of the information provided by the state lottery commission pursuant to section 5-573, subsection C, the director shall determine if the person is receiving assistance from any financial assistance program administered by the department. If the person is receiving assistance, the director shall promptly redetermine the eligibility of that person to receive the assistance.

§ 41-1966 Auditor general; duties

A. The auditor general may:

Determine the validity and accuracy of information reported by the department to the legislature.
Perform other reviews and analyses relating to the department.
Review a specific department function or process.

B. Pursuant to section 41-1279.04, the department shall provide the auditor general access to any data from the department, including electronic data, the auditor general deems necessary to perform the duties outlined in this section. This data shall be provided in the manner and format prescribed by the auditor general.

§ 41-1966.01 Summer youth program; allocation

The summer youth program is established to be funded by monies appropriated from the state general fund. Monies for the program:

Shall be used for purposes of summer youth programs including employment, education and gang prevention programs for youths who are from economically disadvantaged areas and who are at least twelve but not more than eighteen years of age.
Shall be allocated as follows:

(a) Fifty per cent of the monies shall be distributed within counties with a population of two million persons or more.

(b) Thirty per cent of the monies shall be distributed within counties with a population of one million or more but less than two million persons.

(c) Twenty per cent of the monies shall be distributed within counties with a population of less than one million persons.

Are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-1966.02 Project intervention program

A. The project intervention program is established to be funded by monies appropriated from the state general fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies for the program shall be distributed to private, nonprofit locally initiated community based organizations that are in partnership with organizations that are recognized under section 501(c)(3) of the United States internal revenue code and that are operated by or are members of a consortium consisting of representatives from at least five of the following categories:

Residents in the community.
Business and civic leaders who are actively involved in providing employment and business development opportunities in this state.
Educators.
Religious organizations. A religious organization may not provide sectarian instruction or worship in connection with an activity that is funded by a grant made pursuant to this section.
Other public agencies.
Agencies or organizations serving youths.

C. Grants that are awarded under this section shall be used to enhance neighborhood rehabilitation projects, including:

Housing rehabilitation.
Community cleanup efforts.
Graffiti abatement.
Drug and gang prevention.
After school programs.
Job creation programs.

§ 41-1967 Child care resource and referral system; immunity

A. The department shall establish and maintain a statewide child care resource and referral system, including a child care home provider registry, through community-based organizations to:

Provide families with:

(a) Information on all types of child care.

(b) Referrals to child care providers and programs.

(d) Information about choosing child care.

(e) Information about registered child care home providers.

Assist child care providers and programs with:

(a) Information on training related to child care issues.

(b) Technical assistance that relates to initiating or providing child care services.

(d) Becoming registered as a child care home provider.

Coordinate with the community to:

(a) Develop statistics of the demand for and supply of child care.

(b) Maintain ongoing relationships with all local groups interested in child care.

B. The child care resource and referral system shall:

Identify all available child care providers and programs through coordination with public and private agencies.
Collect in a uniform method provider information for the referral database that includes:

(a) The type of program.

(b) The hours of service.

(d) Fees for service.

(e) The licensure, certification and registration status of providers.

(f) Other significant provider and program information.

Establish and maintain a referral process that responds to parental need for information. The child care resource and referral system shall make referrals to child care providers and programs that:

(a) Promote parental choice and meet the needs of families.

(b) Are included in the resource and referral database.

Collect in a uniform method family information for the referral database that includes the:

(a) Number of calls and contacts.

(b) Ages of children in need of care.

(d) Type of care requested.

(e) Special needs and requests made by the family.

(f) Reason that the care is needed.

Provide outreach services that include:

(a) Efforts to reach parents and providers in local communities.

(b) Involvement in the local communities.

(d) Public awareness information to parents and providers about the child care home provider registry and the benefits of using the registry or becoming registered.

Provide technical assistance to existing and prospective child care providers and programs that include:

(a) Information on all aspects of initiating new child care services including child care regulations, zoning, program and budget development and assistance in finding information from other sources.

(b) Educational information and resources that assist existing child care providers and programs to better serve the children and parents in their community.

Establish and maintain a child care home provider registry that includes:

(a) Child care home providers that are registered pursuant to section 41-1967.01.

(b) A complaint tracking system that contains written complaints concerning providers and written provider responses. The complaints and responses are available to the public.

(c) A system for notifying a provider that is excluded or removed from the registry that the provider may appeal directly to the entity making the determination resulting in the exclusion or removal.

(d) Information provided by registered providers relating to the services provided and child care environment.

C. The following child care providers are eligible to be considered for inclusion in the child care resource and referral database, unless barred by other provisions of law:

Child care providers licensed or certified by a government agency that is authorized by law to license, certify or approve child care providers.
Child care home providers that are registered pursuant to section 41-1967.01. These providers shall submit and amend when necessary sworn, written statements to the department or its designees, on forms approved by the department, attesting that the provider is not subject to exclusion or removal from the child care resource and referral database under any of the grounds specified in subsection E of this section.

D. Child care providers identified in subsection C, paragraph 1 of this section may be excluded or removed from the child care resource and referral database whenever the provider's license or certification is revoked, terminated or suspended, or when a child care facility is closed for cause.

E. Child care home providers identified in subsection C, paragraph 2 of this section may be excluded or removed from the child care home provider registry and the child care resource and referral database if:

The provider fails to obtain a fingerprint clearance card or the provider's fingerprint clearance card is revoked or suspended.
The provider has been denied a license to operate a facility for the care of children or had a license or certificate to operate a facility revoked or has been removed for cause from participation in the child and adult food program in this state or in any other state or jurisdiction.
The provider, the provider's employees or any person eighteen years of age or older who resides in the provider's child care facility has been convicted of or is awaiting trial on any of the criminal offenses listed in section 41-1758.07, subsections B and C in this state or similar criminal offenses in any other state or jurisdiction.
The provider, the provider's employees or any person who resides in the provider's child care facility has been the subject of an investigation where a report of child abuse or neglect has been substantiated by the department of child safety or a child safety services agency or a law enforcement agency in this state or in any other state or jurisdiction.
The provider fails to maintain current training and certification in first aid and infant and child cardiopulmonary resuscitation.
The provider fails to enclose a pool pursuant to section 36-1681, subsections A, B and C.
The provider fails to separately store firearms and ammunition under lock and key or combination lock.

F. This section and section 41-1967.01 do not create an affirmative obligation on the part of any state agency or any child care resource and referral agency to review, monitor or investigate child care providers and programs.

G. Neither this state nor its officers or employees, acting within the scope of their employment, are liable for any damage or injury caused by their conduct pursuant to this section or section 41-1967.01, except for gross negligence or conduct intended to cause injury.

H. Neither a child care resource and referral agency nor its officers and employees, acting within the scope of their employment, are liable for any damage or injury caused by their conduct pursuant to this section or section 41-1967.01, except for gross negligence or conduct intended to cause injury.

I. The department shall adopt rules that are consistent with the terms of this section.

§ 41-1967.01 Child care home provider; registration; fingerprints; definition

A. A child care home provider who receives compensation to care for four or fewer children and who has not been certified by the department of economic security pursuant to section 46-807 or licensed or certified by the department of health services pursuant to section 36-883 or 36-897.01 shall register with the department of economic security if the child care home provider wishes to be listed with the child care resource and referral system.

B. Each applicant for registration shall submit a full set of fingerprints to the department of public safety for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

C. Child care providers shall have a valid fingerprint clearance card issued pursuant to section 41-1758.07 before being registered with the department or residing in a setting that is certified or licensed by the department.

D. By the date of registration, child care providers shall certify on forms that are provided by the department and notarized whether:

They are awaiting trial on or have been convicted of or admitted committing any of the criminal offenses listed in section 41-1758.07, subsection B or C in this state or similar offenses in another state or jurisdiction.
They are parents or guardians of a child adjudicated to be a dependent child as defined in section 8-201.
They have been denied a license to operate a child care facility for cause in this state or another state or had a license or certificate to operate a child care facility revoked.

E. The notarized forms are confidential.

F. Each applicant for registration shall not have been the subject of an investigation in which a report of child abuse or neglect has been substantiated.

G. Each applicant shall maintain current training and certification in first aid and infant and child cardiopulmonary resuscitation.

H. The applicant shall enclose any pool on the applicant's premises pursuant to section 36-1681, subsections A, B and C.

I. The applicant shall separately store firearms and ammunition under lock and key or a combination lock.

J. The department shall adopt rules to carry out this section.

K. The director shall charge a fee for processing the fingerprint information required pursuant to this section.

L. Any obligation or liability under this section is governed by section 41-1967, subsections F, G and H.

M. For the purposes of this section, "child care provider" means a registered child care home provider pursuant to subsection A of this section and any person who is eighteen years of age or older and who works or resides in the home of a child care home provider.

§ 41-1968 DES employees; fingerprint requirement; definition

Each employee of the department who has contact with children or vulnerable adults shall have a valid fingerprint clearance card issued pursuant to section 41-1758.07 or provide to the department documentation of the person's application for a fingerprint clearance card. The employee shall certify on forms that are provided by the department and that are notarized whether the employee is awaiting trial on or has ever been convicted of any of the criminal offenses listed in section 41-1758.07, subsections B and C in this state or similar offenses in another state or jurisdiction. For the purposes of this section, "vulnerable adult" has the same meaning prescribed in section 13-3623.

§ 41-1969 Information technology personnel and DCS employees and contractors with access to federal tax information; fingerprint clearance card; definition

A. Each employee of the department of economic security who is employed in an information technology position and each employee or contractor of the department of economic security who has access to federal tax information shall have a valid fingerprint clearance card issued pursuant to section 41-1758.07 or provide to the department documentation that the person has applied for a fingerprint clearance card. Each employee and contractor shall certify on forms that are provided by the department and notarized that the person is not awaiting trial on or has not been convicted of any of the criminal offenses listed in section 41-1758.07, subsections B and C in this state or similar offenses in another state or jurisdiction.

B. The department of economic security shall not disclose information obtained pursuant to subsection A of this section except to members of the department's staff solely for employment purposes.

C. For the purposes of this section, "federal tax information":

Includes returns or return information that is received directly from the internal revenue service or that is obtained through an authorized secondary source pursuant to section 6103 of the internal revenue code.
Does not include returns or return information that is provided by the taxpayer.

§ 41-1970 Out-of-school time grant program; fund; report; definitions

A. The out of school time grant program is established in the department to expand out-of-school time child care for children who are at least five and not older than twelve years of age and who require child care either when the children are out-of-school or during periods of time when school instruction is not being conducted.

B. The grant program shall:

Increase the number of eligible pupils with access to child care before school, after school or during periods of time when school instruction is not being conducted.
Increase access to and the affordability of child care for children and their families.
Enable employers to attract and retain a talented workforce.
Reduce the cost of child care to participating families by at least two-thirds.

C. The department shall do all of the following:

Develop an annual grant application process.
Provide grants to assist with the costs of child care to eligible grantees who participate in the grant program.
Monitor eligible grantees to ensure grant program and fiscal compliance.
Develop metrics to measure the success of the grant program.
Allocate at least thirty percent of grant monies for eligible grantees in rural communities, which may be used in any location in this state if there are insufficient grant applications from rural communities.

D. The out-of-school time grant program fund is established consisting of legislative appropriations. The department may not use more than five percent of the monies deposited in the fund to administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

E. On or before August 1, 2026 and each year thereafter, the department shall submit an annual report to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state. The report shall include all of the following:

The total number of children who are served by the out-of-school time grant program, categorized by age of the child and the county where the child is served. The information provided pursuant to this paragraph may not include any information that identifies or can be used to identify a child.
The locations of programs, categorized by county.
The number of new and sustained child care slots.

F. The department may develop policies and procedures that are necessary to implement this section.

G. For the purposes of this section:

"Eligible grantee" means a nonprofit organization, public school and public or private child care provider that has demonstrated experience providing child care before school, after school or during periods of time when school instruction is not being conducted.
"Eligible pupils" means children who are at least five and not older than twelve years of age and who come from a household earning $150,000 or less per year.

Article 2 Advisory Council

§ 41-1981 Economic security council; special purpose councils

A. In order to form a council advisory to the governor and the department and representative of the needs of the people of this state and with respect to manpower, economic security, social welfare and vocational rehabilitation, there is established an economic security council. The economic security council shall also serve the requirements of the Wagner-Peyser act, as amended, the social security act, as amended, the vocational rehabilitation act, as amended, the manpower development and training act, as amended, the vocational education act, as amended, the economic opportunity act, as amended, and future federal and state legislation relating to economic security, for planning, funding or implementing programs related to such acts.

B. The governor shall appoint the members of the council. Membership shall correspond to pertinent federal regulations concerning advisory and planning councils or committees. The governor shall annually select the council chairman from the membership of the council.

C. The council should have eighteen members representing the public and relevant professional, business, manufacturing, labor and educational organizations.

D. Council members serve for a term of three years.

E. The director shall establish any special purpose councils as are required by state or federal law, rules or regulations or determined to be essential to the public's interest. These councils shall include an intellectual disabilities advisory council, a rehabilitation advisory council, an income maintenance advisory council, an apprenticeship advisory council, an Indian affairs advisory council and an advisory council on hunger. Membership qualifications shall be in accordance with the appropriate law, rule or regulation. The director shall appoint, with the approval of the governor, the members of each council after consultation with members of the economic security council.

F. Appointment to fill a vacancy on the council or any special purpose council resulting from other than expiration of term shall be for the unexpired portion of a term only.

G. The department shall provide secretarial and staff support services to the councils.

H. The members of the economic security council are eligible to receive compensation pursuant to section 38-611. The members of any special purpose council are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

Article 3 Hearings and Appeals

§ 41-1991 Appeals; procedures

Appeals shall be conducted in accordance with chapter 6, article 6 of this title, except as otherwise provided by law.

§ 41-1992 Hearing officers; powers and duties

A. The director shall appoint hearing officers who shall conduct such hearings as the director may determine are necessary in accordance with law.

B. Within a reasonable time before the date set for the hearing any interested party to a hearing before the department may file an affidavit for change of hearing officer against any hearing officer of the department hearing such matters and the hearing officer shall immediately transfer the matter to another hearing officer of the department who shall preside in the matter. Reasonable time shall be established by regulation. Not more than one change of hearing officer shall be granted to any one party.

C. In every contested case, the hearing officer shall issue to all interested parties a decision on the record that includes findings of fact and conclusions of law. The decision shall become the final decision of the department within fifteen days after it is mailed or electronically transmitted to an interested party unless a written petition for review has been filed or the case has been removed to the appeals board for review and decision.

D. The appeals board established pursuant to section 23-672 is authorized to review any hearing officer's decision on timely filing of a petition for review by an interested party. On review, the appeals board may affirm, reverse, modify or set aside a hearing officer's decision or remand the case to any hearing officer for additional evidence, rehearing or modification of decision.

E. On notice to all interested parties, the appeals board may remove to itself any case pending before any hearing officer before a decision becomes final.

F. The department shall prescribe by regulation procedures for implementing this section.

§ 41-1993 Judicial review

A. Any party aggrieved by a decision of the director is entitled to judicial review of the decision pursuant to title 12, chapter 7, article 6.

B. Any party aggrieved by a decision of the appeals board may file an application for appeal to the court of appeals with the clerk of the appeals board within thirty days after the date of mailing or electronic transmission of the decision, except as provided in subsection C of this section. On the filing of an application for appeal, the clerk of the appeals board shall transmit to the court of appeals the application for appeal, the decisions issued by the appeals board and all petitions for review and responses of the appeals board. The clerk of the appeals board shall also transmit any portions of the record before the department requested by the court of appeals. The court of appeals shall thereafter grant or deny the application for appeal. If the application is denied, the decision of the appeals board shall be deemed final, and further appeal may not be taken. If the application is granted, the rules for appeals in civil actions shall apply, commencing with the preparation and transmittal of the complete record before the department and a record index. A bond for costs on appeal or docket fee is not required. The department and all parties before the appeals board shall be given notice of the appeal and an opportunity to appear. All appeals are limited to the record before the department unless the court orders otherwise. An issue may not be raised on appeal that has not been raised in the petition for review before the appeals board. The department shall provide the record for use by the court and by any parties who request copies. The cost of providing the record is a taxable cost if the department prevails. The court of appeals may designate one department of division one to hear all appeals under this section.

C. Any party aggrieved by a decision of the appeals board concerning tax liability, collection or enforcement may appeal to the tax court, as defined in section 12-161, within thirty days after the date of mailing or electronic transmission of the decision. The appellant need not pay any of the tax, penalty or interest upheld by the appeals board in its decision before initiating, or in order to maintain an appeal to the tax court pursuant to this section.

D. Any appeal that is taken to tax court pursuant to this section is subject to the following provisions:

No injunction, writ of mandamus or other legal or equitable process may issue in an action in any court in this state against an officer of this state to prevent or enjoin the collection of any tax, penalty or interest.
The action shall not begin more than thirty days after the date of mailing or electronic transmission of the appeals board's decision. Failure to bring the action within thirty days after the date of mailing or electronic transmission of the appeals board's decision constitutes a waiver of the protest and a waiver of all claims against this state arising from or based on the illegality of the tax, penalties and interest at issue.
The scope of review of an appeal to tax court pursuant to this section shall be governed by section 12-910, applying section 23-613.01 as that section reads on the date the appeal is filed to the tax court or as thereafter amended. Either party to the action may appeal to the court of appeals or supreme court as provided by law.

§ 41-1994 Appeal from superior court

An aggrieved party may secure a review of a final judgment of the superior court made and entered under this article, unless prohibited by law. The appeal shall be taken in the manner provided by law for appeals from superior court in a civil action.

§ 41-1995 Service of documents by electronic means

Notwithstanding section 41-1002, subsection B and section 41-1063, the hearing officer or appeals board, as an alternative to any other means of service permitted or required by any law, may serve or deliver any notice, decision or order or any other document by electronic means if the party being served consents in writing or on the record to service by electronic means. Service by electronic means is deemed complete on transmission.

Article 4 Resource Development

§ 41-2011 Definitions

In this article, unless the context otherwise requires:

"Client" means a person or a family member of a person who receives or who is eligible to receive some form of assistance or services from the department.
"Department" means the department of economic security.
"Director" means the director of the department of economic security.
"Person" includes a firm, society, partnership, association, company or corporation, as well as a natural person.
"Volunteer" means a person who is appointed to perform duties for the department without compensation.

§ 41-2012 Resource development

A. In addition to the provisions of section 41-1954, subsection A, the department may develop resources in the private sector to assist it in administering departmental programs.

B. Resource development shall include the following activities:

Solicitation, acceptance and expenditure of private donations of monies, gifts, services and devises to accomplish the purposes of this article notwithstanding any provisions to the contrary.
Distribution by the department of private monies, gifts, services, contributions and devises to the following:

(a) Foster parents.

(b) Volunteers.

(d) Clients of the department.

(e) Parents, guardians or other persons responsible for the care of clients of the department.

Establishment of a volunteer program as follows:

(a) Volunteers who transport clients of the department on official business may be reimbursed for expenses, with the approval of the director or his designee, in the same amount and manner provided for public employees pursuant to title 38, chapter 4, article 2. The designated post of duty for a volunteer shall be considered to be his place of residence for purposes of receiving reimbursement under this subsection.

(b) The director shall provide a mechanism for recognizing volunteers and supporters of the department, which may include provision of plaques, pins or other appropriate memorabilia or sponsorship of recognition events.

C. The director may adopt rules to carry out this article.

Article 5 Early Intervention Programs and Services for Infants and Toddlers

§ 41-2021 Definitions

In this article, unless the context otherwise requires:

"Early intervention programs and services" means developmental services that are provided under public supervision at no cost, except if federal or state law provides for a system of payments by families, and that are designed to meet one or more of an infant's or toddler's developmental needs.
"Infants and toddlers" means children from birth to thirty-six months of age who need early intervention programs and services because they have either of the following:

(a) A developmental need as evidenced by experiencing developmental delays, as measured by appropriate diagnostic instruments and procedures, in one or more of the following areas:

(i) Cognitive development.

(ii) Physical development.

(iii) Language and speech development.

(iv) Psychosocial development.

(v) Self-help skills.

(b) A diagnosed physical or mental condition that has a high probability of resulting in developmental delays.

"Interagency coordinating council for infants and toddlers" means the council established by order of the governor in accordance with federal law.

§ 41-2022 Infants and toddlers with developmental delays; lead agency; intergovernmental agreements; individualized family service plans; intervention service options; community resource guide

A. The department of economic security shall serve as the lead agency for the coordination of a system of early intervention programs and services to infants and toddlers with developmental delays.

B. The interagency coordinating council for infants and toddlers shall advise and assist the department of economic security in developing and implementing the statewide system and shall assist the department of economic security in achieving the full participation, coordination and cooperation of all appropriate public agencies in this state.

C. The department of economic security, the department of education, the department of health services, the Arizona health care cost containment system administration and the Arizona state schools for the deaf and the blind shall enter into one or more intergovernmental agreements to develop and implement a comprehensive, coordinated system of early intervention programs and services for infants and toddlers with or at risk of developmental delays and their families in accordance with Public Law 99-457 (20 United States Code section 671). The interagency coordinating council for infants and toddlers may assist in the development of the interagency agreements.

D. The intergovernmental agreements developed and implemented by the department pursuant to this section shall require that at the initial individualized family service plan meeting, and every subsequent review of the individualized family service plan, the department must provide families information on the identified priorities, needs and outcomes for the infant or toddler, including additional community resources that do not qualify for services under the individuals with disabilities education act (20 United States Code sections 1431-1444) and the regulations adopted pursuant to the act. The department must develop a community resource guide that is available to families electronically. At the initial individualized family service plan meeting the department must show families how to access the electronic guide and have print copies available by request to families who cannot access the electronic guide.

E. The department shall develop a process for incorporating community resources in the community resource guide, pursuant to subsection D of this section, that ensures that the listed resources are offered in Arizona and to the targeted early intervention population. The department shall keep the electronic guide updated, as necessary, with new resources. The resource guide shall include information on intervention service options that may not be covered by the individuals with disabilities education act (20 United States Code sections 1431-1444) and the family shall be informed if a service option is not covered, in whole or in part. The resource guide shall include:

Information on therapy services, including occupational therapy, physical therapy, applied behavioral analysis and speech-language pathology.
Information on technology services and language acquisition resources including all of the following:

(a) Hearing aids.

(b) Cochlear or brainstem implants.

(d) Other assistive devices.

(e) American sign language.

(f) Listening and spoken language.

(g) Manually coded English.

(h) Cued speech.

(i) Speech reading.

F. For an infant or toddler identified with hearing impairment, a family may choose to engage an audiologist in the initial or subsequent family service plan meeting where the individualized family service plan is established or discussed to provide professional and clinical information.

G. Agencies that provide services and participate in the system of early intervention programs and services shall have an updated electronic copy of the early intervention program community resource guide available to families.

H. The intergovernmental agreements developed and implemented by the department pursuant to this section shall have a process to allow, to the maximum extent appropriate, parents to choose a natural environment for services in which infants and toddlers with disabilities participate, including the home and community based settings in which children without disabilities participate.

I. The department shall create a process by which a family that has been referred to early intervention programs and services can request a different service coordinator for their early intervention services.

Chapter 15 Governor's Office on Tribal Relations

Article 1 General Provisions

§ 41-2051 Governor's office on tribal relations; director; responsibilities of state agencies; report

A. The governor's office on tribal relations is established. The office shall assist state agencies in implementing tribal consultation and outreach activities.

B. The governor shall appoint the director pursuant to section 38-211. The director is entitled to receive compensation pursuant to section 38-611. The office may employ clerical, professional and technical personnel subject to chapter 4, article 4 of this title and shall prescribe their duties and determine their compensation pursuant to section 38-611.

C. Each state agency shall:

Develop and implement tribal consultation policies to guide the agency's work and interaction with the tribal nations of this state.
To the extent practicable and permitted by law, seek input from appropriate elected or appointed tribal officials before undertaking any action or policy that will, or is reasonably believed to, have the potential to affect a tribal community or its members.
To the fullest extent possible and to the best of the agency's ability, integrate the input generated from tribal consultation into the agency's decision-making processes to achieve mutually acceptable solutions.
Designate a state member to assume responsibility for the agency's implementation of the tribal consultation policies and to act as the principal point of contact for tribal affairs.
On or before October 1 of each year, review the agency's tribal consultation policies and submit an electronic progress report with performance measures to the office. The office shall make the reports available to tribal leaders and legislators.

D. The office may initiate or assist programs on tribal land only on the request or with the approval of the tribal nation.

E. At least once a year, the governor shall meet with the tribal leaders of the twenty-two tribal nations and communities in a state-tribal summit to address issues of mutual concern.

§ 41-2052 Governor's office on tribal relations; state and local public officers and employees; powers; report

A. On request, state and local public officers and employees shall furnish the governor's office on tribal relations with any information that the office may require for its purposes except for information that is not subject to disclosure pursuant to law.

B. The office may:

Apply for, accept, receive and spend public and private gifts or grants of monies and property on the terms and conditions as may be imposed by the donor and for the implementation of internal operations and forums for American Indian people to impart their knowledge on statewide issues.
Accept, receive and spend fees collected at the Arizona Indian town hall to defer expenses for the Arizona Indian town hall.
Assist in evaluating, consolidating and coordinating activities relating to the education of American Indian students.
Serve as an informational clearinghouse and provide training on cross-cultural situations.
Receive annual notice from the director of the state museum on the discovery of American Indian human remains, funerary objects, sacred ceremonial objects or objects of cultural patrimony.
Promote increased participation by American Indians in local and state affairs.
Work in conjunction with state agencies involved in economic development to design and initiate programs to stimulate economic growth of the American Indian population, including minority-owned and women-owned businesses.
Establish an executive committee or other committees, as necessary.

C. The office shall prepare a report that summarizes each state agency's annual progress report submitted pursuant to section 41-2051, subsection C that details the progress and challenges that the state agencies have experienced in implementing tribal consultation policies and shall submit the report to the legislature during a joint session held on Indian nations and tribes legislative day.

§ 41-2053 Indian nations and tribes legislative day

A. The governor's office on tribal relations, in cooperation with representatives from this state's Indian nations, shall annually facilitate an Indian nations and tribes legislative day on Wednesday of the first week of each regular legislative session. The office shall coordinate the planning and preparation of the legislative day with the president of the senate, the speaker of the house of representatives and legislators who are Native American. The senate shall host the legislative day in odd-numbered years and the house of representatives shall host the legislative day in even-numbered years. The hosting chamber shall hold a joint session of the legislature. The office shall invite the legislature and other elected officials to pay tribute to the history and culture of the American Indian peoples and their contributions to the prosperity and cultural diversity of the United States. The office shall schedule activities and discussions between state and Indian nations and tribal leaders on issues in which the state and Indian nations and tribes share a common interest or jurisdiction.

B. Indian nations and tribes legislative day is not a legal holiday.

§ 41-2054 Indian town hall fund

The Arizona Indian town hall fund is established that consists of monies collected or received at Indian town halls as fees that are intended to defray administrative costs related to these town halls pursuant to section 41-2052. The governor's office on tribal relations shall deposit, pursuant to sections 35-146 and 35-147, all fees collected from this activity in this fund.

Chapter 16 State Permitting Dashboard

Article 1 General Provisions

§ 41-2101 Definitions

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

In this chapter, unless the context otherwise requires:

"Agency":

(a) Means any executive department of this state.

(b) Does not include the corporation commission.

"Authorization" means a license, permit, approval, finding, land use permit, determination or other administrative decision that is issued by this state to site, construct, reconstruct or commence operations of an eligible project that is administered by an agency.
"Director" means the state permitting director.
"Eligible project" means an activity in this state that requires authorization by an agency, that involves infrastructure construction for renewable or conventional energy production, electricity transmission, mining, land revitalization, surface transportation, aviation, water resource projects, wastewater projects, broadband, pipelines or manufacturing or any other activity as determined by the director and that meets both of the following:

(a) Is subject to applicable state environmental laws, permitting regulations and other relevant government authorizations, the size and complexity of which will make the eligible project benefit from enhanced oversight and coordination.

(b) Requires a total construction investment of more than $25,000,000, or if the total construction investment is less than $25,000,000, the director finds that other factors make enhanced oversight and coordination beneficial to the eligible project.

"Participating project" means an eligible project included in the permitting dashboard established pursuant to section 41-2104.
"Permitting dashboard" means an online tool for agencies, project developers and interested members of the public to track authorizations by agencies for participating projects.
"Project sponsor" means the entity that undertakes an eligible project.

§ 41-2102 State permitting director

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

A. The governor shall appoint a state permitting director to implement this chapter.

B. At the request of the chairperson of the joint legislative budget committee, the director shall appear before the joint legislative budget committee to report on findings from administering the permitting dashboard.

§ 41-2103 Participating projects; notice; agency designation

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

A. A project sponsor of an eligible project may submit to the director a notice that the project sponsor is initiating a proposed project. Each notice shall include all of the following:

A statement of the purposes and objectives of the proposed project.
A project description with geographic information, including the location of the proposed project and geospatial information.
A statement regarding the technical and financial ability of the project sponsor to construct the proposed project.
A list of agencies that may require authorizations for completion of the proposed project.
A statement of any authorization that is anticipated to be required to complete the proposed project.
An assessment that the proposed project meets the definition of an eligible project under this chapter and a statement of reasons supporting the assessment.

B. Not later than thirty days after receiving the notice specified in subsection A of this section, the director shall determine whether the proposed project qualifies as an eligible project and whether to include the proposed project as a participating project.

C. Not later than forty-five days after the date of the determination made in subsection B of this section, each agency identified by the project sponsor shall submit to the director all anticipated authorizations required for each participating project, including both of the following:

The steps required by the project sponsor and the agency to complete each authorization.
The target completion time for each step.

D. If an agency requires an authorization to complete a participating project that was not submitted pursuant to subsection C of this section, the agency shall provide to the director a written statement of cause for the additional authorization.

E. Each agency identified by the project sponsor shall notify the director regarding any decision made that materially affects the status of a participating project and shall submit any significant document associated with the decision as allowed by state and federal law.

F. An agency may not require an eligible project to participate in the permitting dashboard.

§ 41-2104 Permitting dashboard; permitting timetable

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

A. The director shall establish and maintain an online database to be known as the permitting dashboard that displays the progress to completion for state authorizations for participating projects. The permitting dashboard must include a visual interface that tracks the status of each authorization required for participating projects.

B. The director shall coordinate with the department of environmental quality, department of transportation, state land department, department of water resources, Arizona commerce authority, Arizona game and fish department and state historic preservation office and any other agency that requires authorization for a participating project.

C. For each participating project that is added to the permitting dashboard, the director may display on the permitting dashboard, to the extent consistent with applicable law, all of the following:

The notice submitted under section 41-2103, subsection A.
The application and supporting documents, if applicable, that the project sponsor has submitted for any required authorization or a notice explaining how the public may obtain access to the documents if the documents are not available on the website.
A description of any decision made that materially affects the status of a participating project.
A list of roles and responsibilities for all entities with authorization responsibility for the participating project.
A permitting timetable that sets forth a comprehensive schedule of dates by which all authorizations and, to the maximum extent practicable, state permits, reviews and approvals will be made.
The completion status of the authorization included in the permitting timetable.

§ 41-2105 State and local government coordination

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

To integrate authorizations, each agency, to the maximum extent practicable, shall carry out its obligations with respect to a participating project under any other applicable law concurrently and in conjunction with other authorizations being conducted by other agencies or local governments unless the agency determines that doing so would impair the agency's ability to carry out its statutory obligations.

§ 41-2106 Dispute resolution; governor's regulatory review council; rules

(L21, Ch. 405, sec. 31. Rpld. 1/1/29)

A. The director, in consultation with the project sponsor and any relevant agency, as necessary, shall mediate any dispute related to the permitting timetable.

B. If a resolution for a dispute is not reached pursuant to subsection A of this section, the director shall notify the governor's regulatory review council and review the dispute with the directors of the relevant agency. Within thirty days after the director notifies the governor's regulatory review council of the dispute, the governor's regulatory review council shall recommend a course of action to the director, and the director may require agency action to resolve the dispute.

C. The governor's regulatory review council may adopt rules regarding the implementation of this section.

Chapter 17 Criminal Justice Information Systems

Article 1 Arizona Criminal Justice Information System

§ 41-2201 Definitions

In this article, unless the context otherwise requires:

"Component information system" means an independent information system that serves one or more criminal justice agencies and that may participate in the Arizona criminal justice information system.
"Criminal history record information" has the same meaning prescribed in section 41-1750.
"Criminal justice agency" has the same meaning prescribed in section 41-1750.
"Department" means the department of public safety.
"Manager" means the Arizona criminal justice information system manager.
"System" means the Arizona criminal justice information system as defined in section 41-1750.

§ 41-2204 System manager; powers and duties

The director of the department of public safety is the system manager. The manager shall:

Execute the policies and supervise the operations of the system.
Coordinate and standardize the design, development and implementation of the system and subsystem.
Provide for system and subsystem planning.
Enforce the rules relating to the security, privacy, confidentiality and dissemination of criminal history record information.
Provide criminal justice agencies with criminal history record information for operational and management purposes pursuant to rules adopted by the department governing the dissemination of such information.
Receive petitions for review of criminal history record information from persons who are the subject of the information, conduct hearings to determine the accuracy of that information and amend the criminal history record if the information is found to be inaccurate.

§ 41-2205 Central state repository

A. The central state repository for the collection, storage and dissemination of criminal history record information is established. The department of public safety shall operate the central state repository pursuant to rules adopted by the department. The department shall conduct annual audits to ensure that each criminal justice agency is complying with rules governing the maintenance and dissemination of criminal history record information.

B. Each criminal justice agency shall report criminal history record information, whether collected manually or by means of an automated system, to the central state repository pursuant to sections 41-1750 and 41-1751.

§ 41-2206 Disciplinary action; system participants

The department may remove any agency, company or individual that fails to conform to the rules adopted pursuant to this article from participation in the system.

Chapter 18 Greater Arizona Development Authority

Article 1 General Provisions

§ 41-2251 Definitions

In this article, unless the context otherwise requires:

"Authority" means the greater Arizona development authority.
"Board" means the board of directors of the Arizona finance authority established by chapter 53, article 2 of this title.
"Financial assistance" means assistance provided by the authority to eligible political subdivisions, special districts and Indian tribes pursuant to section 41-2257.
"Fund" means the greater Arizona development authority revolving fund established by section 41-2254.
"Indian tribe" means any Indian tribe, band, group or community that is recognized by the United States secretary of the interior and that exercises governmental authority within the limits of any Indian reservation under the jurisdiction of the United States government, notwithstanding the issuance of any patent and including rights-of-way running through the reservation.
"Infrastructure" means any land, building or other improvement and equipment or other personal property that will make up part of a facility that is located in this state for public use and that is owned by a political subdivision, special district or Indian tribe that retains ultimate responsibility for its operation and maintenance.
"Loan" means bonds, leases, loans or other evidences of indebtedness.
"Loan repayment agreement" means an agreement to repay a loan entered into by a political subdivision, special district or Indian tribe.
"Pledged revenues" means any monies to be received by a political subdivision, special district or Indian tribe, including property taxes, other local taxes, fees, assessments or charges pledged by a political subdivision, special district or Indian tribe as a source for repayment of a loan repayment agreement.
"Political subdivision" means a county, city or town.
"Short-term assistance" means assistance provided by the authority to political subdivisions, special districts and Indian tribes in connection with the financing of infrastructure.
"Special district" means any of the following entities established pursuant to title 48:

(a) Municipal improvement district.

(b) Fire district.

(d) Special road district.

(e) Sanitary district.

(f) Drainage or flood protection district.

(g) County flood control district.

(h) County jail district.

(i) Regional public transportation authority.

(j) Regional transportation authority.

"Technical assistance" means assistance provided pursuant to section 41-2256.
"Technical assistance repayment agreement" means an agreement to repay assistance provided pursuant to section 41-2256.
"Tribal subdivision" means any chapter, district or village that is recognized by an Indian tribe by resolution or through tribal constitution and that receives technical assistance.

§ 41-2252 Greater Arizona development authority

The greater Arizona development authority is established in the Arizona finance authority. The authority shall be governed by the board of directors of the Arizona finance authority.

§ 41-2253 Powers and duties of authority

A. The authority is a body corporate and politic and shall have an official seal that is judicially noticed. The authority may sue and be sued, contract and acquire, hold, operate and dispose of property as necessary to carry out its responsibilities under this article.

B. The authority, through its board, may:

Issue bonds to provide financial assistance to political subdivisions, special districts and Indian tribes for acquiring, constructing, improving or equipping infrastructure or for refinancing outstanding bonds or other obligations of the political subdivisions, special districts or Indian tribes that were issued to acquire, construct, improve or equip infrastructure. The bonds shall be in the name of the authority.
Provide financial assistance to political subdivisions, special districts and Indian tribes to finance or refinance infrastructure projects.
Guarantee debt obligations of political subdivisions, special districts and Indian tribes that are issued to finance or refinance infrastructure projects.
Provide technical assistance or short-term assistance to political subdivisions, special districts, Indian tribes and tribal subdivisions.
Apply for, accept and administer grants and other monetary assistance from the United States government and from other public and private sources to carry out its responsibilities under this article.
Hire professional assistance as needed to carry out this article.

C. The board shall:

Approve all policies and procedures of the authority.
Approve which projects receive technical and financial assistance.
Approve loan repayment agreements entered into with political subdivisions, special districts and Indian tribes.

D. The authority may impose administrative fees and penalties that are necessary to recover the costs incurred in connection with entering into or enforcing a loan repayment agreement or providing financial or technical assistance.

E. The board shall deposit, pursuant to sections 35-146 and 35-147, any monies received pursuant to subsection B, paragraph 5 of this section in the fund.

§ 41-2254 Greater Arizona development authority revolving fund

A. The greater Arizona development authority revolving fund is established consisting of:

Monies appropriated by the legislature.
Monies received from the United States government to carry out this article.
Monies received from political subdivisions, Indian tribes, tribal subdivisions and special districts as loan repayments, technical assistance repayments, interest, administrative fees and penalties.
Interest and other income received from investing monies in the fund.
Gifts, grants and donations received from any public or private source to carry out this article.
Any other monies received by the authority.

B. The board shall administer the fund in compliance with the requirements of this article. The board shall separately account for monies received from each source listed in subsection A of this section. Monies received pursuant to subsection A, paragraph 1 of this section shall not be used for any purpose except securing bonds issued by the authority and providing assistance under technical assistance repayment agreements if the amount used for providing this assistance is not more than eight hundred thousand dollars. This subsection does not limit the power of the authority to pledge other monies in the fund to secure bonds issued by the authority or to provide assistance under technical assistance repayment agreements.

C. The board may establish accounts and subaccounts as necessary to properly account for and use monies received by the authority.

D. Monies in the fund may be used for securing bonds of the authority.

E. Monies in the fund received pursuant to subsection A, paragraphs 2, 3, 4, 5 and 6 of this section may be used for:

Providing technical assistance to political subdivisions, special districts, Indian tribes and tribal subdivisions.
Providing financial assistance to political subdivisions, special districts and Indian tribes.
Paying compensation and employment-related expenses.
Paying the costs to operate the authority, to administer the fund and to carry out the requirements of this article.
Paying the costs of professional assistance hired by the authority pursuant to section 41-2253, subsection B, paragraph 6.

F. On notice from the board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

G. If the monies pledged to secure the bonds become insufficient to pay the principal and interest on the bonds, the board may direct the state treasurer to divest monies in the fund as may be necessary and may apply those proceeds to make current all payments then due on the bonds. The state treasurer shall immediately notify the attorney general and auditor general of the insufficiency. The auditor general shall audit the circumstances surrounding the depletion of the fund and shall report these findings to the attorney general. The attorney general shall conduct an investigation and report these findings to the governor and the legislature.

§ 41-2255 Project application and prioritization

A. The authority shall:

Establish an application form for technical and financial assistance.
Establish a procedure to review and approve or disapprove on its merits each administratively complete application for technical and financial assistance.
Establish by rule criteria by which technical and financial assistance will be awarded. For financial assistance the criteria shall include a determination of the ability of the applicant to repay a loan according to its terms and other conditions established by this article.
Adopt rules to prioritize applications for technical and financial assistance.
Inform the applicant of the board's determination within ninety days after the application date established by the authority pursuant to paragraph 2 of this subsection.

B. The board shall:

Approve or disapprove applications for financial and technical assistance.
Determine the order and priority of projects assisted under this article based on the merits of the applications.

C. If the application is approved, the board may condition the approval on assurances the board deems necessary to ensure that the technical assistance or financial assistance will be used according to law and the terms of the application. The loan repayment agreement shall include any conditions concerning financial assistance deemed necessary by the board.

D. The authority shall only make financial assistance or short-term assistance available when the applicant is ready to proceed or, if the financial assistance is for refinancing outstanding bonds or other obligations, when the outstanding bonds or other obligations are to be refunded. The authority may provide technical assistance on an as needed basis. The authority may charge the applicant fees sufficient to cover the authority's costs related to the project.

E. A political subdivision, a special district or an Indian tribe may apply to the authority for financial assistance and may accept assistance in connection with an infrastructure project owned by the political subdivision, special district or Indian tribe. The existence of a current investment grade rating on existing debt of the applicant that is secured by the same revenues to be pledged to secure repayment under the loan repayment agreement may be accepted by the board as evidence regarding the ability of the applicant to repay a loan.

F. The authority shall only make financial assistance available upon a determination of the ability of the applicant to repay the financial assistance according to its terms and conditions.

G. Applications for financial assistance shall:

Be solicited annually, semiannually, quarterly or monthly as determined by the authority pursuant to subsection A, paragraph 2.
Be administratively complete before being reviewed by the authority.
Include documentation concerning the ability of the applicant to repay the financial assistance according to its terms and conditions.
Include a resolution from the governing body of the political subdivision, special district or Indian tribe that the project is in the best interests of the residents.

H. Applications for technical assistance shall:

Be solicited annually or semiannually as determined by the authority pursuant to subsection A, paragraph 2, except that an application for short-term assistance may be solicited at those times as the authority determines.
Be administratively complete before being reviewed by the authority.
Include a resolution from the governing body of the political subdivision, special district or Indian tribe that the project is in the best interests of the residents.

§ 41-2256 Technical assistance; repayment agreements

A. The authority may provide technical assistance to political subdivisions, special districts, Indian tribes and tribal subdivisions in connection with the development or financing of infrastructure.

B. Technical assistance may include the following:

Assistance in selecting outside consultants.
Evaluation of design and construction options.
Financial advisory services.
Assistance in satisfying statutory requirements.
Short-term assistance.

C. Assistance provided under a technical assistance repayment agreement:

Shall not be more than two hundred fifty thousand dollars for a single project.
Shall be repaid not more than three years after the date the monies for the assistance are advanced to the applicant.
Shall be in a form and under terms determined by the authority.

D. Short-term assistance represents an advance of financial assistance. The authority shall not provide short-term assistance unless the political subdivision, special district or Indian tribe has an approved financial assistance application on file with the authority. A political subdivision, special district or Indian tribe shall repay short-term assistance pursuant to a technical assistance repayment agreement.

E. The authority shall establish an application process and method of determining the allocation of technical assistance pursuant to section 41-2255.

F. Before technical assistance may be provided, the board shall approve the application for technical assistance.

G. The provision of technical assistance by the authority does not create any liability for the authority or this state regarding the design, construction or operation of any infrastructure project.

§ 41-2257 Financial assistance

A. The authority may provide financial assistance to political subdivisions, special districts and Indian tribes in developing, acquiring, constructing, improving, equipping or refinancing infrastructure. The financial assistance shall include:

Loans as provided in this section.
Credit enhancements purchased for a political subdivision's, special district's or Indian tribe's bonds or other forms of indebtedness.

B. A loan shall be evidenced by a loan repayment agreement, lease purchase agreement or bonds of a political subdivision, special district or Indian tribe that are delivered to and held by the authority.

C. The authority shall prescribe a principal repayment schedule for each loan made. Loan principal payments may be rescheduled at the discretion of the authority but may not be forgiven.

D. A loan under this section:

Shall be repaid not more than thirty years after the date it is incurred.
Shall require that interest payments begin not later than the next date that either principal or interest must be paid by the authority to holders of any of the authority's bonds that provided funding for the loan. The authority may provide that loan interest accruing during construction of the borrower's infrastructure project and up to one year after completion of the construction be capitalized in the loan.
Shall be repayable in at least annual principal installments and at least semiannual interest installments.
Shall be conditioned on the identification of pledged revenues for repaying the loan. If the infrastructure financed by the loan is part of a municipal utility and the city or town pledges revenues of the utility to repay the loan, the loan shall be treated under section 9-530, subsection B as a lawful long-term obligation incurred for a specific capital purpose.
To the extent permitted by law, shall be secured by a debt service reserve account that is held in trust and that is in such amount, if any, as determined by the authority.
Shall be either:

(a) For a political subdivision, additionally secured by an irrevocable pledge of the shared state revenues due the political subdivision for the life of the loan as provided by a resolution of the board.

(b) For an Indian tribe, conditioned on the establishment of a dedicated revenue source under the control of a tribally chartered corporation or other tribal entity that is subject to suit by the attorney general to enforce the loan contract or be secured by assets that, in the event of default of the loan contract, are subject to execution by the attorney general.

E. The authority shall prescribe the rate or rates of interest on loans made under this section, but the rate or rates shall not exceed the prevailing market rate for similar types of loans. A political subdivision or special district may negotiate the sale of its bonds to or a loan repayment agreement with the authority without complying with any public or accelerated bidding requirements imposed by any other law for the sale of its bonds.

F. The approval of a loan is conditioned on a written commitment by the political subdivision or special district to complete all applicable reviews and approvals and to secure all required permits in a timely manner.

G. The approval of financial assistance to a city or town having a population of more than fifty thousand persons shall be conditioned on approval of its voters. An election is not required if voter approval has previously been received for substantially the same project.

H. The approval of financial assistance to a county having a population of more than two hundred thousand persons shall be conditioned on approval of its voters. An election is not required if voter approval has previously been received for substantially the same project.

I. By resolution of the board, the authority may impose any additional requirements it considers necessary to ensure that the loan principal and interest are timely paid.

J. All monies received from political subdivisions, special districts and Indian tribes as loan repayments, interest and penalties shall be deposited, pursuant to sections 35-146 and 35-147, in the fund.

K. The attorney general may take whatever actions are necessary to enforce the loan contract and achieve repayment of loans provided by the authority pursuant to this article.

L. If a political subdivision fails to make any payment due to the authority under its loan repayment agreement or bonds, the authority shall certify to the state treasurer and notify the governing body of the defaulting political subdivision that the political subdivision has failed to make the required payment and direct a withholding of state shared revenues as provided in subsection M of this section. The certificate of default shall be in the form determined by the authority, provided the certificate specifies the amount required to satisfy the unpaid payment obligation of the political subdivision.

M. On receipt of a certificate of default from the authority, the state treasurer, to the extent not otherwise expressly prohibited by law, shall withhold the monies from the next succeeding distribution of monies pursuant to section 42-5029 due to the defaulting political subdivision. In the case of a city or town, the state treasurer shall also withhold from the next succeeding distribution of monies pursuant to section 43-206 due to the defaulting city or town the amount specified in the certificate of default and immediately deposit the amount withheld in the fund. The state treasurer shall continue to withhold and deposit the monies until the authority certifies to the state treasurer that the default has been cured. In no event shall the state treasurer withhold any amount that is necessary, as certified by the defaulting political subdivision to the state treasurer and the authority, to make any required deposits then due for the payment of principal and interest on bonds of the political subdivision that were issued prior to the date of the loan repayment agreement or bonds and that have been secured by a pledge of distributions made pursuant to sections 42-5029 and 43-206.

§ 41-2258 Greater Arizona development authority bonds

A. The authority, through the board, may issue negotiable bonds in a principal amount that in its opinion is necessary to provide sufficient monies for assistance under this article, to refund bonds, when the authority deems it expedient to do so, maintaining sufficient reserves in the fund to secure the bonds, to pay the necessary costs of issuing, selling and redeeming the bonds and to pay other expenditures of the authority incidental to and necessary and convenient to carry out the purposes of this article.

B. The board shall authorize the bonds by resolution. The resolution shall prescribe:

The rate or rates of interest and the denominations of the bonds.
The date or dates of the bonds and maturity.
The coupon or registered form of the bonds.
The manner of executing the bonds.
The medium and place of payment.
The terms of redemption.

C. The bonds shall be sold at public or private sale at the price and on the terms determined by the board. All proceeds from the issuance of bonds, except any amounts used to pay costs associated with the issuance and sale of the bonds, shall be deposited in the fund or a separately held account as specified in the resolution.

D. To secure any bonds authorized by this section the board by resolution may:

Provide that bonds issued under this section may be secured by a lien on all or part of the monies paid into the appropriate account or subaccount of the fund.
Pledge or assign to or in trust to be held by the state treasurer or a trustee appointed by the authority for the benefit of the holder or holders of the bonds any part of the appropriate account or subaccount of the fund monies as is necessary to pay the principal and interest of the bonds as they come due.
Set aside, regulate and dispose of reserves and sinking funds.
Provide that sufficient amounts of the proceeds from the sale of the bonds may be used to fully or partly fund any reserves or sinking funds set up by the bond resolution.
Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which consent may be given.
Provide for payment from the proceeds of the sale of the bonds of all legal and financial expenses incurred by the board in issuing, selling, delivering and paying the bonds.
Provide terms necessary to secure credit enhancement or other sources of payment or security.
Provide any other terms and conditions that in any way may affect the security and protection of the bonds.

E. Any pledge of revenues by a political subdivision, a special district, an Indian tribe or the authority made under this article is valid and binding from the time when the pledge is made. The monies pledged and received by the state treasurer to be placed in the fund or in any account or subaccount in the fund are immediately subject to the lien of the pledge without any future physical delivery or further act, and any lien of any pledge is valid or binding against all parties having claims of any kind in tort, contract or otherwise against the board regardless of whether the parties have notice of the lien. The official resolution or trust indenture or any instrument by which this pledge is created, when placed in the board's records, is notice to all concerned of the creation of the pledge, and those instruments need not be recorded in any other place.

F. A member of the board or any person executing the bonds is not personally liable for the payment of the bonds. The bonds are valid and binding obligations notwithstanding that before the delivery of the bonds any of the persons whose signatures appear on the bonds cease to be members of the board. From and after the sale and delivery of the bonds, they are incontestable by the board.

G. The board, out of any available monies, may purchase bonds, which may then be canceled, at a price not exceeding either of the following:

If the bonds are then redeemable, the redemption price then applicable plus accrued interest to the next interest payment date.
If the bonds are not then redeemable, the redemption price applicable on the first date after purchase on which the bonds become subject to redemption plus accrued interest to that date.

H. The bonds issued under this section, their transfer and the income they produce are exempt from taxation by this state or by any political subdivision of this state.

I. If a political subdivision fails to make a payment due to the authority under its loan repayment agreement or bonds, the authority shall certify to the state treasurer and notify the governing body of the defaulting political subdivision that the political subdivision has failed to make the payment and direct withholding pursuant to subsection J of this section. The authority may determine the form of the certificate of default, except that the certificate must specify the amount of money required to satisfy the unpaid payment obligation of the political subdivision.

J. On receipt of a certificate of default from the authority, the state treasurer, to the extent not otherwise expressly prohibited by law, shall withhold an amount from the defaulting political subdivision's next distribution of monies pursuant to section 42-5029 and an amount from a defaulting city's or town's next distribution of monies pursuant to section 43-206 necessary to meet the certified amount of the deficiency. The state treasurer shall immediately deposit in the fund the amount withheld. The state treasurer shall continue to withhold distributions pursuant to sections 42-5029 and 43-206 and deposit them into the fund until the authority certifies to the state treasurer that the default has been cured.

K. Notwithstanding subsection J of this section, the state treasurer shall not withhold from the distribution of monies under section 42-5029 any amount, as certified by the defaulting political subdivision to the state treasurer and the authority, that is necessary to make any required deposits then due for payment of principal and interest on bonds of the political subdivision that have been secured by a pledge of the distribution.

§ 41-2259 Bond obligations of the authority

Bonds issued under this article are obligations of the authority, are payable only according to their terms and are not general, special or other obligations of this state. The bonds do not constitute a legal debt of this state and are not enforceable against this state. Payment of the bonds is not enforceable out of any state monies other than the income and revenue pledged and assigned to, or in trust for the benefit of, the holder or holders of the bonds.

§ 41-2260 Agreement of state

A. This state pledges to and agrees with the holders of the bonds that this state will not limit or alter the rights vested in the authority or any successor agency to collect the monies necessary to produce sufficient revenue to fulfill the terms of any agreements made with the holders of the bonds, or in any way impair the rights and remedies of the bondholders, until all bonds issued under this article, together with interest, with interest on any unpaid installments of interest and all costs and expenses in connection with any action or proceedings by or on behalf of the bondholders, are fully met and discharged.

B. The board as agent for this state may include this pledge and undertaking in its resolutions and indentures securing its bonds.

§ 41-2261 Certifications of bonds by attorney general

A. The board may submit any bonds issued under this article to the attorney general after all proceedings for their authorization have been completed. Within fifteen days after submission the attorney general shall examine and pass on the validity of the bonds and the regularity of the proceedings.

B. If the proceedings comply with this article, and if the attorney general determines that, when delivered and paid for, the bonds will constitute binding and legal obligations of the board, the attorney general shall certify on the back of each bond, in substance, that it is issued according to the constitution and laws of this state.

§ 41-2262 Bonds as legal investments

Bonds issued under this article are securities:

In which public officers and bodies of this state and of municipalities and political subdivisions of this state, all companies, associations and other persons carrying on an insurance business, all financial institutions, investment companies and other persons carrying on a banking business, all fiduciaries and all other persons who are authorized to invest in obligations of this state may properly and legally invest.
That may be deposited with public officers or bodies of this state and municipalities and political subdivisions of this state for purposes that require the deposit of state bonds or obligations.

§ 41-2263 Annual audit and reporting

A. The board shall cause an annual audit to be made of the fund. The audit shall be conducted by a certified public accountant within one hundred fifty days after the close of the fiscal year. The board shall immediately file a certified copy of the audit with the auditor general.

B. The auditor general may make further audits and examinations that the auditor general considers to be necessary and take appropriate action relating to the audit or examination pursuant to title 41, chapter 7, article 10.1. If the auditor general takes no official action within twenty days after the annual audit is filed pursuant to subsection A, the audit is considered to be sufficient.

C. The board shall pay any fees and costs of the certified public accountant and auditor general under this section from the earnings on the fund.

D. Not later than January 1 of each year, the board shall submit an annual report of its activities, including a copy of the annual audit, to the governor, the president of the senate and the speaker of the house of representatives.

Chapter 19 Office of Tourism

Article 1 General Provisions

§ 41-2301 Office of tourism

There is established an office of tourism.

§ 41-2302 Director; compensation; duties; appointment

A. The director of the office shall be responsible for promoting and developing tourism business and planning, and developing a campaign of information, advertising, promotion, exhibition and publicity relating to tourism business, including the recreational, scenic and historical attractions of this state and all communities and regions of this state, and disseminating such information to the public through various state, national and international media.

B. The director is eligible to receive compensation determined pursuant to section 38-611.

C. The director shall be appointed by the governor pursuant to section 38-211 and shall serve at the governor's pleasure.

D. The director shall have at least the following qualifications:

Five years of management experience in the domestic and international tourism and travel industry.
A fundamental understanding of the technical elements of the tourism industry including travel, trade, group, incentive and individual markets, advertising techniques and evaluation methods.
Experience in either marketing or public relations.

§ 41-2303 Assistant director of tourism

A. The director shall appoint an assistant director of tourism subject to approval by the governor.

B. In the absence of the director, the assistant director shall perform the duties of the director of tourism.

§ 41-2304 Advisory council; representation; duties

A. The governor shall appoint a tourism advisory council which shall be composed of fifteen members who shall serve at the pleasure of the governor.

B. Members of the tourism advisory council shall include representatives from recreational and tourist attractions, lodging, restaurant or food and transportation industries, other tourism businesses and the general public. The council shall include one member from each of the six geographical planning areas of this state. The respective areas shall consist of the noted counties as follows:

Area 1 Maricopa.
Area 2 Pima.
Area 3 Apache, Coconino, Navajo and Yavapai.
Area 4 Mohave and Yuma.
Area 5 Gila and Pinal.
Area 6 Graham, Greenlee, Cochise and Santa Cruz.

C. Of the members first appointed, three shall be appointed for a term ending June 30, 1979 and three each for terms ending one, two, three and four years thereafter. Subsequent appointments shall be for terms of five years, except for an appointment to fill an unexpired term which shall be for the remainder of the term.

D. The council shall assist and advise the director in preparation of the budget and in establishment of policies and programs which promote and develop tourism in this state.

§ 41-2305 Powers and duties

A. In addition to other duties prescribed by law, the office of tourism shall:

Stimulate and encourage all local, state, regional and federal governmental agencies and all private persons and enterprises to participate and cooperate in the promotion of tourism and tourism development in this state.
Undertake a comprehensive research program designed to establish the office as the central repository and clearinghouse for all data that relates to tourism.
Perform research necessary to determine a long-range tourism development plan for this state.
Conduct research at the request of the governor, the legislature or state or local agencies, pertaining to any of its objectives.
Formulate policies, plans and programs designed to promote tourism in this state.
Provide information and advice on request by local, state and federal agencies and by private citizens and business enterprises on all matters concerning its objectives. The office may provide information and literature in the same manner as described in section 11-259, subsection A.
Advise with and make recommendations to the governor and the legislature on all matters concerning tourism.
Make an annual report to the governor and the legislature on its activities, finances and the scope of its operations.
Conduct an annual statewide tourism symposium to discuss tourism promotion efforts, problems and matters of interest to the tourism industry.
Cooperate with the Arizona-Mexico commission in the governor's office and with researchers at universities in this state to collect data and conduct projects in the United States and Mexico on issues that are within the scope of the office's duties and that relate to quality of life, trade and economic development in this state in a manner that will help the Arizona-Mexico commission to assess and enhance the economic competitiveness of this state and of the Arizona-Mexico region.

B. The office may:

Subject to chapter 4, article 4 of this title, employ, determine the conditions of employment and specify the duties of administrative, secretarial and clerical assistants and contract for the services of outside advisors, consultants and aides reasonably necessary or desirable to enable it adequately to perform its duties. The compensation of such assistants shall be as determined pursuant to section 38-611. The positions of the director, the assistant director and all employees of the office of tourism shall be exempt positions of chapter 4, articles 5 and 6 of this title.
Make contracts and incur obligations reasonably necessary or desirable within the general scope of its activities and operations to enable it adequately to perform its duties.
Use any and all media of communication, publication and exhibition in the dissemination of information, advertising and publicity in any field relating to its purposes, objectives or duties.
Use its funds, facilities and services to provide matching contributions under federal or other programs that further the objectives and programs of the office.
Adopt rules it deems necessary or desirable to implement the purposes of the department and the duties and powers of the director.
Accept gifts, grants, matching funds and direct payments from public or private agencies or persons for the conduct of programs that are consistent with the general purposes and objectives of this chapter.
Conduct tourism education and discussion seminars and workshops to discuss tourism promotion efforts, problems and matters of interest to the tourism industry.
Designate, establish and operate state visitor or tourist information centers in the state that furnish tourist information and literature, subject to legislative appropriation.
Conduct research pertaining to any of its objectives.
Establish a reporting system for public agencies and private persons or enterprises in order to monitor state tourism.
Produce, own, sell or license services or personal property related to the duties and goals of the office, limited to marketing and branding related promotional materials or items, copyrightable publications, artwork, trademarks or other intellectual property, and charge reasonable prices for all these items. The director shall establish the prices. Monies received pursuant to this section shall be credited to the tourism development fund established by section 41-2307 to support the office.
Exercise its statutory powers and duties by engaging in joint venture activities with private corporations that are specifically designed to further the goals of the office of tourism. Joint ventures entered into by the office of tourism shall conform to the constitution and the laws of this state.

§ 41-2306 Tourism fund

(Caution: 1998 Prop 105 applies)

A. The tourism fund is established consisting of separate accounts derived from:

State general fund monies appropriated to the fund by the legislature. All monies in this account are continuously appropriated to the office of tourism for the purposes of operations and statewide tourism promotion.
Revenues deposited pursuant to section 5-835, subsection B or C. All monies in this account are continuously appropriated to the office of tourism, which, in consultation with a consortium of destination marketing organizations in the county in which the tourism and sports authority is established, shall be spent to promote tourism within that county. For fiscal years 2010-2011 and 2011-2012, fifty per cent of the revenues deposited in the tourism fund pursuant to this paragraph may be expended by the office of tourism for operational and administrative purposes.
Revenues deposited pursuant to section 42-6108.01. The legislature shall appropriate all monies in this account to the office of tourism, which, in conjunction with the destination marketing organization in the county in which the tax revenues are collected, shall be spent only to promote tourism within that county and shall not be spent for administrative or overhead expenses.
Revenues deposited pursuant to section 5-601.02(H)(3)(b)(iv). The office of tourism shall administer the account. The account is not subject to appropriation, and expenditures from the fund are not subject to outside approval notwithstanding any statutory provision to the contrary. Monies received pursuant to section 5-601.02 shall be deposited directly with this account. On notice from the office of tourism, the state treasurer may invest and divest monies in the account as provided by section 35-313, and monies earned from investment shall be credited to the account. No monies in the account shall revert to or be deposited in any other fund, including the state general fund. Monies in this account shall supplement, not supplant, current funds in other accounts of the tourism fund. Monies in this account shall be spent only to promote tourism within the state and shall not be used for administrative or overhead expenses.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-2307 Tourism development fund

The tourism development fund is established consisting of monies received pursuant to section 41-2305. The office of tourism shall administer the fund. Monies in the fund are continuously appropriated for the purposes of supporting tourism marketing and branding of this state. Beginning in fiscal year 2024-2025, on or before October 1 of each year, the office of tourism shall report to the joint legislative budget committee the monies in the fund and expenditures made pursuant to this section from the previous fiscal year and the purposes of those expenditures.

§ 41-2308 Special sporting events; promotion and marketing; report; appropriation; definitions

A. Beginning from and after June 30, 2021, the state treasurer shall pay from monies appropriated pursuant to this section $1,500,000 per fiscal year, in twelve equal monthly installments, to the office of tourism for the purposes described in this section. The office of tourism shall deposit the monies in a separate fund and shall use the monies to promote and market a special sporting event at a host facility. For the purposes of this section, the office of tourism shall contract with a promotion and marketing vendor that has the requisite capabilities and expertise to promote and market a special sporting event, but the office of tourism is not limited to a vendor on statewide contract for marketing services. If the office of tourism develops a competitive solicitation for a promotion and marketing vendor, the office of tourism, in consultation with the host facility, shall develop the qualifications, specifications and evaluation factors for the competitive solicitation in accordance with chapter 23 of this title and rules adopted pursuant to chapter 23 of this title. The procurement evaluation committee that consists of a representative of the state procurement office, the office of tourism and the host facility shall evaluate and recommend a vendor. On or before October 1 of each year, the office of tourism shall report to the joint legislative budget committee the amounts and purposes of all expenditures made pursuant to this subsection in the previous fiscal year.

B. The treasurer may make the payments prescribed in subsection A of this section if the special sporting event project cost incurred from and after December 31, 2016 is at least $100,000,000.

C. The host facility shall report to the joint legislative budget committee and the governor's office of strategic planning and budgeting that it has incurred the special sporting event project cost prescribed in subsection B of this section on or before December 31, 2020. The joint legislative budget committee shall certify the expenditures reported by the host facility.

D. If the requirements of subsections B and C of this section are met, the sum of $1,500,000 is appropriated annually from the state general fund to the state treasurer for the purposes of this section beginning in fiscal year 2021-2022 and ending in fiscal year 2050-2051.

E. For the purposes of this section:

"Host facility" means a complex facility in this state that has fixed seating, that requires a ticket for admission for viewing a sporting event and that was chosen to host a special sporting event by a site selection organization through a competitive selection process that included consideration of at least one facility that is not located in this state.
"Special sporting event" means a sporting event that is sanctioned by a nationally recognized premier national auto racing series governing body that establishes an annual schedule of sporting events and grants rights to conduct the events, that has established and administers rules and regulations governing all participants involved in the events and all persons conducting the events and that requires certain liability assurances, including insurance.
"Special sporting event project" means:

(a) The acquisition of land subject to property tax in this state to construct a host facility for a special sporting event.

(b) The construction, reconstruction, improvement or renovation of improvements to land subject to property tax in this state of a host facility for a special sporting event.

"Special sporting event project cost" means the monies spent from and after December 31, 2016 by the owner of the host facility on the special sporting event project.

Chapter 21 Arizona Criminal Justice Commission

Article 1 General Provisions

§ 41-2401 Criminal justice enhancement fund

A. The criminal justice enhancement fund is established consisting of monies collected pursuant to section 12-116.01 and monies available from any other source. The state treasurer shall administer the fund.

B. On or before November 1 of each year, each department, agency or office that receives monies pursuant to this section shall provide to the Arizona criminal justice commission a report for the preceding fiscal year. The report shall be in a form prescribed by the Arizona criminal justice commission. The report shall set forth the sources of all monies and all expenditures. The report shall not include any identifying information about specific investigations.

C. On or before December 1 of each year, the Arizona criminal justice commission shall compile all reports into a single comprehensive report and shall submit a copy of the comprehensive report to the governor, the president of the senate, the speaker of the house of representatives and the director of the joint legislative budget committee.

D. On the first day of each month, the state treasurer shall distribute or deposit:

20.81 percent in the department of public safety forensics fund established by section 41-1730.
3.57 percent to the department of juvenile corrections for the treatment and rehabilitation of youth who have committed drug-related offenses.
5.18 percent in the prosecuting attorneys' advisory council training fund established by section 41-1830.03.
12.38 percent to the supreme court for the purpose of reducing juvenile crime.
10.01 percent to the department of public safety for allocation to state and local law enforcement authorities for the following purposes:

(a) To enhance projects that are designed to prevent residential and commercial burglaries, to control street crime, including the activities of criminal street gangs, and to locate missing children.

(b) To provide support to the Arizona automated fingerprint identification system.

12.38 percent to the department of law for allocation to county attorneys for the purpose of enhancing prosecutorial efforts.
8.59 percent to the supreme court for the purpose of enhancing the ability of the courts to process criminal and delinquency cases, orders of protection, injunctions against harassment and any proceeding relating to domestic violence matters, for auditing and investigating persons or entities licensed or certified by the supreme court and for processing judicial discipline cases. Notwithstanding section 12-143, subsection A, the salary of superior court judges pro tempore who are appointed for the purposes provided in this paragraph shall, and the salary of other superior court judges pro tempore who are appointed pursuant to section 12-141 for the purposes provided in this paragraph may, be paid in full by the monies received pursuant to this paragraph.
15.06 percent to the county sheriffs for the purpose of enhancing county jail facilities and operations, including county jails under the jurisdiction of county jail districts.
3.52 percent to the Arizona criminal justice commission.
4.34 percent in the department of public safety forensics fund established by section 41-1730.
4.16 percent to the supreme court for the purpose of providing drug treatment services to adult probationers through the community punishment program established in title 12, chapter 2, article 11.

E. Monies distributed pursuant to subsection D, paragraphs 3, 6, 8 and 10 of this section constitute a continuing appropriation. Monies distributed pursuant to subsection D, paragraphs 1, 2, 4, 7, 9 and 11 of this section are subject to legislative appropriation.

F. The portion of the monies for direct operating expenses of the department of public safety in subsection D, paragraph 5 of this section is subject to legislative appropriation. The remainder of the monies in subsection D, paragraph 5 of this section, including the portion for local law enforcement, is continuously appropriated.

G. The allocation of monies pursuant to subsection D, paragraphs 5, 6, 7 and 8 of this section shall be made in accordance with rules adopted by the Arizona criminal justice commission pursuant to section 41-2405.

§ 41-2402 Drug and gang enforcement fund; resource center fund; uses

A. The drug and gang enforcement fund is established and consists of monies appropriated by the legislature and any other monies available from other sources, public or private. Monies in the fund shall be used to enhance efforts to deter, investigate, prosecute, adjudicate and punish drug offenders and members of criminal street gangs as defined in section 13-105. The Arizona criminal justice commission shall administer the fund.

B. The Arizona criminal justice commission shall distribute monies from the drug and gang enforcement fund in the following manner:

Up to fifty percent to fund law enforcement agencies approved by the commission to enhance both:

(a) The investigation of drug and gang offenses and related criminal activity.

(b) Drug and gang education and prevention programs.

Up to fifty percent to fund programs and agencies approved by the commission to enhance the state, county, city or town prosecution of drug and gang offenses and related criminal activity.
Up to thirty percent to fund programs and agencies approved by the commission for the purpose of enhancing the ability of the courts to process drug and gang offenses and related criminal cases, either through the appointment of judges pro tempore or the establishment of additional divisions of the courts only for the purposes of this section, enhancing defense and probation services, including treatment, and funding the drug testing program.
Up to thirty percent to fund programs by county sheriffs and the state department of corrections, as approved by the commission, to enhance drug offender treatment programs and the jail operations and facilities available to detain and incarcerate drug offenders and members of criminal street gangs as defined in section 13-105.
Up to thirty percent to fund programs and agencies, as approved by the commission, to enhance the integration of criminal justice records relating to drug and gang offenders and their related criminal activity.

C. Any state agency that receives monies allocated from the drug and gang enforcement fund shall not include the monies as part of the state agency's continuation budget base for the purpose of requesting appropriations for the following fiscal year.

D. All the monies allocated from the drug and gang enforcement fund shall be dedicated solely to the purpose of enhancing efforts to deter, investigate, prosecute, adjudicate and punish drug and gang and related criminal offenders, except those monies allocated pursuant to subsection G of this section.

E. Notwithstanding the limitations prescribed in subsection B of this section, any federal monies or matching state monies in the drug and gang enforcement fund may only be allocated by the commission pursuant to a plan approved by the federal government.

F. The auditor general shall annually perform a full and complete audit of the drug and gang enforcement fund or the commission shall annually contract with an accounting firm to perform the audit and deliver a report to the governor and the legislature. The audit shall be charged to the drug and gang enforcement fund.

G. The resource center fund is established consisting of monies received pursuant to section 12-284.03, subsection A, paragraph 1 and section 41-178 and all monies received from public or private gifts, grants or other sources, excluding federal monies and monies to be passed through to other entities, to be used solely for funding the Arizona youth survey and Arizona statistical analysis center. The Arizona criminal justice commission shall administer the fund. Monies in the fund are subject to legislative appropriation. Any monies unexpended or unencumbered on June 30 of each year shall not be subsequently expended or encumbered unless reappropriated. Monies in the drug and gang enforcement fund shall not be used to fund the Arizona youth survey.

§ 41-2403 Designated state administering agency for federal Edward Byrne memorial justice assistance grants; report

A. The Arizona criminal justice commission is this state's designated state administering agency for the federal Edward Byrne Memorial justice assistance grant that is administered by the United States department of justice, bureau of justice assistance, office of justice programs.

B. The Arizona criminal justice commission shall submit a copy of the federal application for Edward Byrne memorial justice assistance grant monies to the joint legislative budget committee for review at least thirty days before the federal application for the grant is submitted.

§ 41-2404 Arizona criminal justice commission; members; compensation; terms; meetings

A. The Arizona criminal justice commission is established consisting of the following members:

The attorney general or the attorney general's designee.
The director of the department of public safety or the director's designee.
The director of the state department of corrections or the director's designee.
Seventeen members who are appointed by the governor. Not more than nine of these members may be from the same political party.
The administrative director of the courts or the director's designee.
The chairperson of the board of executive clemency or the chairperson's designee.

B. The members who are appointed pursuant to subsection A, paragraph 4 of this section shall include at least one police chief, one county attorney and one county sheriff from a county with a population of one million five hundred thousand or more persons, one police chief, one county attorney and one county sheriff from a county with a population equal to or greater than four hundred fifty thousand persons but fewer than one million five hundred thousand persons and one police chief, one county attorney and one county sheriff from counties with a population of fewer than four hundred fifty thousand persons. The remaining members shall include one law enforcement leader, one former judge, one mayor, one member of a county board of supervisors, one public defender, two victim advocates and one chief probation officer.

C. Members who are appointed pursuant to subsection A, paragraph 4 of this section shall serve for terms of two years terminating on the convening of the first regular session of the legislature and may not use a designee for their attendance. Any appointive member who ceases to be a member of the body the member represents on the commission is deemed to have resigned. Appointments to fill a vacancy shall be made in the same manner as the original appointment.

D. The commission shall meet and organize by electing from among its membership officers as are deemed necessary or advisable. The commission shall hold four meetings during each calendar year, and each member shall attend at least three meetings. Additional meetings may be held as determined by the chairperson. If a member fails to attend at least three meetings each calendar year, the member's position is deemed vacant by operation of law. Appointments to fill a vacancy shall be made in the same manner as the original appointment. A majority of the members constitutes a quorum for the transaction of business.

E. Members of the commission are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

§ 41-2405 Arizona criminal justice commission; powers and duties; staff

A. The Arizona criminal justice commission shall:

Monitor the progress and implementation of new and continuing criminal justice legislation.
Facilitate research among criminal justice agencies and maintain criminal justice system information.
Facilitate coordinated statewide efforts to improve criminal justice information and data sharing.
Prepare for the governor a biennial criminal justice system review report. The report shall contain:

(a) An analysis of all criminal justice programs created by the legislature in the preceding two years.

(b) An analysis of the effectiveness of the criminal code, with a discussion of any problems and recommendations for revisions if deemed necessary.

(c) A study of the level of activity in the several areas of the criminal justice system, with recommendations for redistribution of criminal justice revenues if deemed necessary.

(d) An overall review of the entire criminal justice system, including crime prevention, criminal apprehension, prosecution, court administration and incarceration at the state and local levels as well as funding needs for the system.

(e) Recommendations for constitutional, statutory and administrative revisions that are necessary to develop and maintain a cohesive and effective criminal justice system.

Provide supplemental reports on criminal justice issues of special timeliness.
In coordination with other governmental agencies, gather information on programs that are designed to effectuate community crime prevention and education using citizen participation and on programs for alcohol and drug abuse prevention, education and treatment and disseminate that information to the public, political subdivisions, law enforcement agencies and the legislature.
Make recommendations to the legislature and the governor regarding the purposes and formula for allocation of fund monies as provided in section 41-2401, subsection D and section 41-2402 through the biennial agency budget request.
Adopt rules for the purpose of allocating fund monies as provided in sections 41-2401, 41-2402 and 41-2407 that are consistent with the purposes set forth in those sections and that promote effective and efficient use of the monies.
Make reports to the governor and the legislature as they require.
Oversee the research, analyses, studies, reports and publication of crime and criminal justice statistics prepared by the Arizona statistical analysis center, which is an operating section of the Arizona criminal justice commission.
Prepare an annual report on law enforcement activities in this state that are funded by the drug and gang enforcement fund or the criminal justice enhancement fund and that relate to illicit drugs and drug related gang activity. The report shall be submitted by October 31 of each year to the governor, the president of the senate and the speaker of the house of representatives and a copy shall be submitted to the secretary of state. The report shall include:

(a) The name and a description of each law enforcement program dealing with illegal drug activity or street gang activity, or both.

(b) The objective and goals of each program.

(d) The name of the agency or entity that administers each program.

(e) The effectiveness of each program.

Compile and disseminate information on best practices for cold case investigations, including effective victim communication procedures. For the purposes of this paragraph, "cold case" means a homicide or a felony sexual offense that remains unsolved for one year or more after being reported to a law enforcement agency and that has no viable and unexplored investigatory leads.
Beginning January 1, 2019, submit an annual recidivism report to the legislature that compares the recidivism rate for a person who serves a term of mandatory incarceration in a county jail pursuant to section 28-1383 and a person who serves that term of mandatory incarceration in prison.

B. The Arizona criminal justice commission, as necessary to perform its functions, may:

Request any state or local criminal justice agency to submit any necessary information.
Form subcommittees, make studies, conduct inquiries and hold hearings.
Subject to chapter 4, article 4 of this title, employ consultants for special projects and such staff as deemed necessary or advisable to carry out this section.
Delegate its duties to carry out this section, including:

(a) The authority to enter into contracts and agreements on behalf of the commission.

(b) Subject to chapter 4, article 4 and, as applicable, articles 5 and 6 of this title, the authority to appoint, hire, terminate and discipline all personnel of the commission, including consultants.

Establish joint research and information facilities with governmental and private agencies.
Accept and expend public and private grants of monies, gifts and contributions and expend, distribute or allocate monies appropriated to the commission for the purpose of enhancing efforts to investigate or prosecute and adjudicate any crime and to implement this chapter.

§ 41-2406 Sexual assault records; reports

A. The department of public safety shall electronically provide a data extract from the Arizona computerized criminal history system of all records relating to sexual assaults pursuant to section 13-1406 twice a year to the Arizona criminal justice commission.

B. The Arizona criminal justice commission shall maintain the following records extract regarding sexual assaults pursuant to section 13-1406 that are submitted to the commission by the department of public safety:

The number of police reports that are filed if available.
The number of charges that are filed and what charges are filed.
The number of convictions that are obtained.
The sentences that are imposed for each conviction.

C. The commission shall annually submit the report required by subsection B of this section to the governor, the president of the senate and the speaker of the house of representatives and shall provide a copy of this report to the secretary of state. The commission may submit this report electronically.

§ 41-2407 Victim compensation and assistance fund; subrogation; prohibited debt collection activity; definition

A. The victim compensation and assistance fund is established. The Arizona criminal justice commission shall administer the fund. The victim compensation and assistance fund shall consist of monies collected pursuant to section 31-411, subsection E and sections 12-116.08, 13-4310, 31-418, 31-467.06 and 41-1674, unclaimed victim restitution monies pursuant to sections 22-116 and 44-313 and monies available from any other source.

B. Subject to legislative appropriation, the Arizona criminal justice commission shall allocate monies in the victim compensation and assistance fund to public and private agencies for the purpose of establishing, maintaining and supporting programs that compensate and assist victims of crime.

C. The allocation of monies pursuant to this section shall be made in accordance with rules adopted by the Arizona criminal justice commission pursuant to section 41-2405, subsection A, paragraph 8. The rules shall provide that persons who suffered personal injury or death that resulted from an attempt to aid a public safety officer in the prevention of a crime or the apprehension of a criminal may be eligible for compensation.

D. This state and the applicable operational unit or qualified program, as defined in the victim compensation program rules, are subrogated to the rights of an individual who receives monies from the victim compensation and assistance fund to recover or receive monies or benefits from a third party, to the extent of the amount of monies the individual receives from the fund.

E. A licensed health care provider who agrees to the victim compensation program rules may receive program monies for providing health and medical services to a victim or claimant. A licensed health care provider who accepts the full allowable payment for those services from a victim compensation program funded pursuant to this section is deemed to have accepted the payment as the full payment for those services. The licensed health care provider may not collect or attempt to collect any payment for the same health and medical services from the victim or claimant, except that if a victim compensation program funded pursuant to this section is unable to pay the full allowable payment to a licensed health care provider because of a lack of available monies or for any other reason, the licensed health care provider may collect the unpaid balance for the services from the victim or claimant or from a third-party payor, and the total amount billed or requested by the licensed health care provider may not exceed the full allowable payment that the licensed health care provider agreed to accept from the victim compensation program for the services.

F. If a licensed health care provider receives notice that a person has filed a claim with a victim compensation program funded by this section, the licensed health care provider is prohibited from any debt collection activity for any monies owed by the person that are included in the filed claim until an award is made on the claim or until a determination is made that the claim is noncompensable. For the purposes of this subsection, "debt collection activity" includes repeatedly telephoning or writing to the claimant and threatening to either turn the matter over to a debt collection agency or to an attorney for collection, enforcement or filing of any other debt collection process. Debt collection activity does not include routine billing or inquiries about the status of the claim.

G. For the purposes of this section, "licensed health care provider" means a person or institution that is licensed or certified by this state to provide health care services, medical services, nursing services, emergency medical services and ambulance services that are regulated pursuant to title 36, chapter 21.1, article 2 or other health-related services.

§ 41-2409 State aid; administration; report

A. The Arizona criminal justice commission shall administer the state aid to county attorneys fund established by section 11-539. On or before September 1 of each year, the commission shall distribute monies in the fund to each county according to the following composite index formula:

The three-year average of the total felony filings in the superior court in the county, divided by the statewide three-year average of the total felony filings in the superior court.
The county population, as adopted by the office of economic opportunity, divided by the statewide population, as adopted by the office of economic opportunity.
The sum of paragraphs 1 and 2 of this subsection divided by two equals the composite index.
The composite index for each county shall be used as the multiplier against the total monies appropriated from the state general fund and other monies distributed to the fund pursuant to section 41-2421.

B. The board of supervisors in each county shall separately account for the monies transmitted pursuant to subsection A of this section and may expend these monies only for the purposes specified in section 11-539. The county treasurer shall invest these monies and interest earned shall be expended only for the purposes specified in section 11-539.

C. The Arizona criminal justice commission shall administer the state aid to indigent defense fund established by section 11-588. By September 1 of each fiscal year, the commission shall distribute monies in the fund to each county according to the following composite index formula:

The three-year average of the total felony filings in the superior court in the county divided by the statewide three-year average of the total felony filings in the superior court.
The county population, as adopted by the office of economic opportunity, divided by the statewide population, as adopted by the office of economic opportunity.
The sum of paragraphs 1 and 2 of this subsection divided by two equals the composite index.
The composite index for each county shall be used as the multiplier against the total monies appropriated from the state general fund and other monies distributed to the fund pursuant to section 41-2421.

D. The board of supervisors shall separately account for the monies transmitted pursuant to subsection C of this section and may expend these monies only for the purposes specified in section 11-588. The county treasurer shall invest these monies and interest earned shall be expended only for the purposes specified in section 11-588.

E. The Arizona criminal justice commission shall administer the state aid for juvenile dependency proceedings fund established by section 41-2410. On or before September 1 of each fiscal year, the Arizona criminal justice commission shall distribute monies in the fund to each county based on the proportional share of filings for each county in the most recent fiscal year for which juvenile dependency case filing figures are available. Distributions from the state aid for juvenile dependency proceedings fund to a county may not exceed $250,000 in any fiscal year. If a county distribution in any fiscal year is projected to exceed $250,000, the Arizona criminal justice commission shall distribute monies in excess of $250,000 to the remaining counties based on the proportional share of juvenile dependency case filings statewide for each county less the juvenile dependency case filings from the counties that have reached the maximum distribution in the fiscal year.

F. The board of supervisors shall separately account for the monies distributed pursuant to subsection E of this section and may spend these monies only for the purposes specified in section 41-2410. The county treasurer shall invest these monies and interest earned shall be spent only for the purposes specified in section 41-2410.

G. On or before January 8 each year, the commission shall report to each county board of supervisors, the governor, the legislature, the joint legislative budget committee, the chief justice of the supreme court and the attorney general on the expenditure of the monies in the state aid to county attorneys fund and the state aid to indigent defense fund for the prior fiscal year and on the progress made in achieving the goal of improved criminal case processing.

§ 41-2410 State aid for juvenile dependency proceedings fund; exemption

A. The state aid for juvenile dependency proceedings fund is established consisting of legislative appropriations. Monies in the fund shall be used to provide state aid to county public defenders, legal defenders and contract indigent defense counsel for the processing of juvenile dependency cases.

B. The Arizona criminal justice commission shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. The commission shall distribute monies in the fund to each county pursuant to section 41-2409, subsection E.

C. On notice from the commission, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investments shall be credited to the fund.

§ 41-2411 Arizona automated fingerprint identification system; development and implementation

A. The Arizona automated fingerprint identification system is established in the department of public safety for the purpose of retaining fingerprint files to be used by the department and other authorized criminal justice automated fingerprint identification sites to make fingerprint identifications for criminal justice and noncriminal justice purposes specifically permitted pursuant to law.

B. The Arizona automated fingerprint identification system is an automated system consisting of:

A central fingerprint repository operated and maintained by the department of public safety.
Two remote full access system terminals which are operated and maintained by a law enforcement agency designated by the Arizona automated fingerprint identification system advisory board.

C. The department of public safety shall procure the necessary equipment and services to establish the system.

§ 41-2412 Arizona automated fingerprint identification system advisory board; duties

A. The Arizona automated fingerprint identification system advisory board is established to oversee the development, operation and maintenance of the Arizona automated fingerprint identification system. The advisory board shall make recommendations to the department of public safety:

On system policies and procedures.
Relating to expansion of the system.

B. The advisory board consists of the following members:

The director of the department of public safety.
The sheriff of Maricopa county.
The sheriff of Pima county.
A sheriff designated by the Arizona sheriffs' association.
A chief of police designated by the Arizona chiefs' of police association.
Two prosecuting attorneys designated by the Arizona prosecuting attorney's advisory council.

§ 41-2413 Arizona automated fingerprint identification system manager; powers and duties; master plan; annual report

The director of the department of public safety is the manager of the Arizona automated fingerprint identification system. The manager shall:

Supervise the operations and maintenance of the system.
Operate and maintain the central fingerprint repository of the system to be used by the department and other authorized criminal justice automated fingerprint identification sites to make fingerprint identifications for criminal justice and noncriminal justice purposes specifically permitted pursuant to law.
Develop a system master plan to describe the overall system design and functions and to establish the system and remote access network.
Develop a system policy manual to provide guidelines to all participating agencies.
Develop system standards of service for the central state repository and participating agencies.
Coordinate and standardize the design, development and implementation of the system and subsystems.
Provide for system and subsystem planning.
Establish as necessary advisory committees to assist in the development, implementation and operation of the system.
Enforce the rules adopted pursuant to section 41-1750 relating to the privacy, confidentiality and dissemination of criminal history record information collected and maintained in conjunction with operations of the system.
Procure equipment and services to establish the system.
Submit an annual report to the Arizona automated fingerprint identification system advisory board on the status of the system.

§ 41-2414 Law enforcement crime victim notification fund; software; vendor requirement; use of monies; definition

A. The law enforcement crime victim notification fund is established consisting of legislative appropriations. The Arizona criminal justice commission shall administer the fund. Monies in the fund are continuously appropriated. Notwithstanding any other law, the Arizona criminal justice commission shall use fund monies to expand the commission's automated crime victim notification system and to fund software that does the following:

Complies with all of the following:

(a) Article II, section 2.1, Constitution of Arizona.

(b) Title 8, chapter 3, article 7.

Enables the Arizona criminal justice commission to deploy an automated crime victim notification system to a user base consisting of law enforcement agencies. The automated crime victim notification system must do the following:

(a) Automatically, and without the requirement to download a software application or to opt in to notifications, notify the victim by email or text of all of the following regarding a victim's law enforcement crime report, investigation and case, if approved by the law enforcement agency:

(i) The date on which the report is filed.

(ii) The case number.

(iii) The name of the detective who is assigned to the case.

(iv) When arrests are made.

(v) When warrants are issued.

(vi) When the case is sent to the prosecuting agency.

(vii) Initial appearance.

(b) Interface with the law enforcement agency's system of record.

(d) Provide the ability to attach informational brochures or other electronic attachments to the messages.

(e) Provide the ability for victims to find their case status on the vendors' websites with links that are available on the law enforcement agency's website.

(f) Be configurable to the requirements of each law enforcement agency in this state.

(g) Include the law enforcement agency's branding, email address and web domain for all communications.

(h) Provide the ability to send messages in multiple languages.

(i) Provide a short code or a long code telephone number with a local area code.

(j) Monitor the number of messages sent and the types of messages sent and visualize the data.

Provides a criminal justice information service compliant automated victim notification platform that ensures the following:

(a) Crime victims are automatically notified by text, automated telephone call or email following any updates to their case.

(b) Law enforcement agencies determine the notifications.

(d) No additional staffing is required.

Provides for multiagency notification to enable an agency to automatically share the status of an incident or investigation with an identified partner agency based on configurable criteria.
Allows victims to leverage conversational artificial intelligence for bidirectional real-time communication with law enforcement agencies through voice, text messages and emails. The system shall provide a virtual agent that responds to and asks questions based on the victim's questions and responses.
Provides a mechanism to track whether there is a data outage at a law enforcement agency and informs the law enforcement agency and the Arizona criminal justice commission of the data outage. During an outage period, the software system shall have a backup process for law enforcement agencies to ensure that notifications are made in a timely and accurate manner.
Complies with the technical guidelines and standards for the operation of a statewide automated crime victim information and notification system recommended by the United States department of justice's bureau of justice assistance.
Provides a designated statewide toll-free number that is available twenty-four hours a day, seven days a week, that is operated by trained operators available in multiple languages and that allows victims, surviving immediate family members, witnesses and other concerned citizens to search for and obtain information about an offender, inmate or case and to register for notifications.

B. The vendors chosen by the Arizona criminal justice commission to be part of the partnership must have previously deployed a solution for a city police department, sheriff's office and prosecutor's office. The previously deployed solutions could have been deployed in Arizona or in another state, or a combination of both.

C. The Arizona criminal justice commission shall use the monies in the fund to pay for law enforcement agencies that choose to use the automated crime victim notification system.

D. For the purposes of this section, "law enforcement agency" includes a state, city, town, county, tribal, university or prosecutorial agency.

§ 41-2415 Unidentified patients; hospitals; criminal justice agencies; fingerprints; biometric identification

A hospital that is licensed pursuant to title 36, chapter 4 may request assistance from a criminal justice agency as defined in section 41-1750 for noncriminal justice purposes to determine the identity of an unidentified patient who is either incapacitated or deceased through an analysis of the patient's fingerprints or biometric identification techniques. A private investigator who is registered pursuant to title 32, chapter 24 may fingerprint or obtain the biometric information from the unidentified patient and provide the fingerprints or biometric information to the criminal justice agency without the patient's consent or authorization. The criminal justice agency shall provide the name of the unidentified patient to the hospital but may not provide any of the patient's criminal history record. The requesting hospital is responsible for the cost of fingerprinting or obtaining the biometric information from the patient and shall pay the fee that is established pursuant to section 41-1750, subsection J.

§ 41-2416 Chemical abuse and related gang activity survey

The criminal justice commission shall conduct an annual statewide survey, when monies are specifically appropriated for that purpose, designed to measure both attitudes and the actual prevalence and frequency of substance abuse by children and adults and the prevalence of street gang activity in this state. The survey shall address substance abuse by children and youth in the public schools and in state institutions of higher education, as well as the nature and extent of substance abuse by adults throughout this state's communities. The survey shall also address the nature and extent of drug related gang activity in this state. The criminal justice commission shall report the results of the survey to the governor, the president of the senate and the speaker of the house of representatives not later than January 1.

§ 41-2417 State aid to detention fund; definition

A. The state aid to detention fund is established for the purposes of providing state assistance to counties in maintaining, expanding and operating juvenile detention centers required by section 8-305. On behalf of the juvenile court, the administrative office of the courts may use monies in the fund to enter into agreements with public agencies or private entities to acquire land for, build, purchase, lease-purchase, lease, maintain, expand or operate juvenile detention centers required by section 8-305. The fund consists of monies appropriated to the fund. The supreme court shall administer the fund.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations and are continuously appropriated. Interest earned on monies in the fund shall be used for the purpose specified in subsection A of this section.

C. All monies distributed or expended from the fund shall be used to supplement, not supplant, funding to the juvenile court by the county. Unless a county has reached its expenditure limit, the county shall contribute to the project in a substantial amount through a cash or in-kind contribution.

D. Monies in the fund granted to a county by agreement with the supreme court may be used to secure payment of bonds for the construction, acquisition or improvement of a juvenile detention center required by section 8-305. A county board of supervisors may authorize the bonds notwithstanding any statutory debt limitations or budget requirements applicable to the county. Grant monies used to secure bonds shall be placed by the county treasurer in a special account that may be pledged or assigned to or in trust for the benefit of bondholders as is necessary to pay and secure payment of the principal of, and interest and premium, if any, on, the bonds as they come due. These bonds shall be administered in the manner provided in title 11, chapter 2, article 5. All principal and interest on bonds issued by a county under this section are payable solely out of monies from the state aid to detention fund established by this section to that county and shall not be a general obligation of the county.

E. Monies granted to a county by agreement with the supreme court under this section may be used to secure grant anticipation notes that a county board of supervisors shall be authorized to issue in the manner provided by title 35, chapter 3, article 3.2.

F. For the purposes of this section, "public agencies" has the same meaning as prescribed in section 11-951.

§ 41-2418 Arizona deoxyribonucleic acid identification system

A. The Arizona deoxyribonucleic acid identification system is established in the department of public safety for the purposes of conducting deoxyribonucleic acid testing and analysis pursuant to section 13-610.

B. The scientific criminal analysis section established in section 41-1771 shall establish procedures for the implementation of section 13-610, subsection H.

§ 41-2420 County jail juvenile improvement fund

A. The county jail juvenile improvement fund is established for the purpose of funding the construction of new juvenile beds in county jail facilities in which juveniles will be detained. The Arizona criminal justice commission shall administer the fund.

B. Monies in the fund are exempt from the provisions of section 35-190 relating to the lapsing of appropriations.

§ 41-2421 Enhanced collections; allocation of monies; criminal justice entities

A. Notwithstanding any other law and except as provided in subsection J of this section, five per cent of any monies collected by the supreme court and the court of appeals for the payment of filing fees, including clerk fees, diversion fees, fines, penalties, surcharges, sanctions and forfeitures, shall be deposited, pursuant to sections 35-146 and 35-147, and allocated pursuant to the formula in subsection B of this section. This subsection does not apply to monies collected by the courts pursuant to section 16-954, subsection A, or for child support, restitution or exonerated bonds.

B. The monies deposited pursuant to subsection A of this section shall be allocated according to the following formula:

21.61 per cent to the state aid to county attorneys fund established by section 11-539.
20.53 per cent to the state aid to indigent defense fund established by section 11-588.
57.37 per cent to the state aid to the courts fund established by section 12-102.02.
0.49 per cent to the department of law for the processing of criminal cases.

C. Notwithstanding any other law and except as provided in subsection J of this section, five per cent of any monies collected by the superior court, including the clerk of the court and the justice courts in each county for the payment of filing fees, including clerk fees, diversion fees, adult and juvenile probation fees, juvenile monetary assessments, fines, penalties, surcharges, sanctions and forfeitures, shall be transmitted to the county treasurer for allocation pursuant to subsections E, F, G and H of this section. This subsection does not apply to monies collected by the courts pursuant to section 16-954, subsection A or for child support, restitution or exonerated bonds.

D. The supreme court shall adopt guidelines regarding the collection of revenues pursuant to subsections A and C of this section.

E. The county treasurer shall allocate the monies deposited pursuant to subsection C of this section according to the following formula:

21.61 per cent for the purposes specified in section 11-539.
20.53 per cent for the purposes specified in section 11-588.
57.37 per cent to the local courts assistance fund established by section 12-102.03.
0.49 per cent to the state treasurer for transmittal to the department of law for the processing of criminal cases.

F. The board of supervisors in each county shall separately account for all monies received pursuant to subsections C and E of this section and expenditures of these monies may be made only after the requirements of subsections G and H of this section have been met.

G. By December 1 of each year each county board of supervisors shall certify if the total revenues received by the justice courts and the superior court, including the clerk of the superior court, exceed the amount received in fiscal year 1997-1998. If the board so certifies, then the board shall distribute the lesser of either:

The total amount deposited pursuant to subsection C of this section.
The amount collected and deposited pursuant to subsection C of this section that exceeds the base year collections of fiscal year 1997-1998. These monies shall be distributed according to the formula specified in subsection E of this section. Any monies remaining after this allocation shall be transmitted as otherwise provided by law.

H. If a county board of supervisors determines that the total revenues transmitted by the superior court, including the clerk of the superior court and the justice courts in the county, do not equal the base year collections transmitted in fiscal year 1997-1998 the monies specified in subsection C of this section shall be transmitted by the county treasurer as otherwise provided by law.

I. For the purposes of this section, base year collections shall be those collections specified in subsection C of this section.

J. Monies collected pursuant to section 12-116.01, subsection B shall be allocated as follows:

15.44 per cent to the state aid to county attorneys fund established by section 11-539.
14.66 per cent to the state aid to indigent defense fund established by section 11-588.
40.97 per cent to the state aid to the courts fund established by section 12-102.02.
0.35 per cent to the department of law for the processing of criminal cases.
14.29 per cent to the Arizona criminal justice commission for distribution to state, county and municipal law enforcement full service forensic crime laboratories pursuant to rules adopted by the Arizona criminal justice commission.
14.29 per cent to the supreme court for allocation to the municipal courts pursuant to subsection K of this section.

K. The supreme court shall administer and allocate the monies received pursuant to subsection J, paragraph 6 of this section to the municipal courts based on the total amount of surcharges transmitted pursuant to section 12-116.01 by that jurisdiction's city treasurer to the state treasurer for the prior fiscal year divided by the total amount of surcharges transmitted to the state treasurer pursuant to section 12-116.01 by all city treasurers statewide for the prior fiscal year. The municipal court shall use the monies received to improve, maintain and enhance the ability to collect and manage monies assessed or received by the courts, to improve court automation and to improve case processing or the administration of justice. The municipal court shall submit a plan to the supreme court and the supreme court shall approve the plan before the municipal court begins to spend these allocated monies.

Chapter 23 Arizona Procurement Code

Article 1 General Provisions

§ 41-2501 Applicability

A. This chapter applies only to procurements initiated after January 1, 1985 unless the parties agree to its application to procurements initiated before that date.

B. This chapter applies to every expenditure of public monies, including federal assistance monies except as otherwise specified in section 41-2637, by this state, acting through a state governmental unit, under any contract, except that this chapter does not apply to either grants, or contracts between this state and its political subdivisions or other governments, except as provided in chapter 24 of this title and in article 10 of this chapter. This chapter also applies to the disposal of state materials. This chapter and rules adopted under this chapter do not prevent any state governmental unit or political subdivision from complying with the terms of any grant, gift, bequest or cooperative agreement.

C. All political subdivisions and other local public agencies of this state may adopt all or any part of this chapter and the rules adopted pursuant to this chapter.

D. Notwithstanding any other law, sections 41-2517 and 41-2546 apply to any agency as defined in section 41-1001, including the office of the governor.

E. The Arizona board of regents and the legislative and judicial branches of state government are not subject to this chapter except as prescribed in subsections F and G of this section.

F. The Arizona board of regents shall adopt rules prescribing procurement policies and procedures for itself and institutions under its jurisdiction. The rules must be substantially equivalent to the other policies and procedures prescribed in this chapter, including sections 41-2576 and 41-2577.

G. The judicial branch shall adopt rules prescribing procurement policies and procedures for itself and institutions under its jurisdiction. The rules must be substantially equivalent to the policies and procedures prescribed in this chapter.

H. The Arizona state lottery commission is exempt from this chapter for procurement relating to the design and operation of the lottery or purchase of lottery equipment, tickets and related materials. The executive director of the Arizona state lottery commission shall adopt rules substantially equivalent to the policies and procedures in this chapter for procurement relating to the design and operation of the lottery or purchase of lottery equipment, tickets or related materials. All other procurement shall be as prescribed by this chapter.

I. The Arizona health care cost containment system administration is exempt from this chapter for provider contracts pursuant to section 36-2904, subsection A and contracts for goods and services, including program contractor contracts pursuant to title 36, chapter 29, articles 2 and 3 and contracts with regional behavioral health authorities pursuant to title 36, chapter 34. All other procurement, including contracts for the statewide administrator of the program pursuant to section 36-2903, subsection B, shall be as prescribed by this chapter.

J. Arizona correctional industries is exempt from this chapter for purchases of raw materials, components and supplies that are used in the manufacture or production of goods or services for sale entered into pursuant to section 41-1622. All other procurement shall be as prescribed by this chapter.

K. The state transportation board and the director of the department of transportation are exempt from this chapter other than sections 41-2517 and 41-2586 and are subject to title 28, chapter 20 and 2 Code of Federal Regulations section 200.317 for the procurement of the following:

All items of construction, reconstruction, rehabilitation, preservation or improvement undertaken on highway infrastructure.
Engineering services and any other work or activity to carry out engineering services related to highway infrastructure.
Right-of-way services related to land titles, appraisals, real property acquisitions, relocation services, property management and facility design.
Any other construction, reconstruction, rehabilitation, preservation or improvement work or activity that is required pursuant to title 28, chapter 20.

L. The Arizona highways magazine is exempt from this chapter for contracts for the production, promotion, distribution and sale of the magazine and related products and for contracts for sole source creative works entered into pursuant to section 28-7314, subsection A, paragraph 5. All other procurement shall be as prescribed by this chapter.

M. The secretary of state is exempt from this chapter for contracts entered into pursuant to section 41-1012 to publish and sell the administrative code. All other procurement shall be as prescribed by this chapter.

N. This chapter does not apply to contracts for professional witnesses if the purpose of such contracts is to provide for professional services or testimony relating to an existing or probable judicial proceeding in which this state is or may become a party or to contract for special investigative services for law enforcement purposes.

O. The head of any state governmental unit, in relation to any contract exempted by this section from this chapter, has the same authority to adopt rules, procedures or policies as is delegated to the director pursuant to this chapter.

P. Agreements negotiated by legal counsel representing this state in settlement of litigation or threatened litigation are exempt from this chapter.

Q. This chapter is not applicable to contracts entered into by the department of economic security:

With a provider licensed or certified by an agency of this state to provide child day care services.
With area agencies on aging created pursuant to the older Americans act of 1965 (P.L. 89-73; 79 Stat. 218; 42 United States Code sections 3001 through 3058ff).
For services pursuant to title 36, chapter 29, article 2.
With an eligible entity as defined by Public Law 105-285, section 673(1)(A)(i), as amended, for designated community services block grant program monies and any other monies given to the eligible entity that accomplishes the purpose of Public Law 105-285, section 672.

R. The Arizona health care cost containment system may not require that persons with whom it contracts follow this chapter for the purposes of subcontracts entered into for the provision of the following:

Mental health services pursuant to section 36-189, subsection B.
Services for the seriously mentally ill pursuant to title 36, chapter 5, article 10.
Drug and alcohol services pursuant to section 36-141.

S. The department of health services may not require that persons with whom it contracts follow this chapter for the purpose of subcontracts entered into for the provision of domestic violence services pursuant to title 36, chapter 30, article 1.

T. The department of health services is exempt from this chapter for contracts for services of physicians at the Arizona state hospital and contracts to provide medically necessary physical health care to individuals under the care of the Arizona state hospital.

U. Contracts for goods and services approved by the board of trustees of the public safety personnel retirement system are exempt from this chapter.

V. The Arizona department of agriculture is exempt from this chapter with respect to contracts for private labor and equipment to effect cotton or cotton stubble plow-up pursuant to rules adopted under title 3, chapter 2, article 1.

W. The Arizona state parks board is exempt from this chapter for purchases of guest supplies and items for resale such as food, linens, gift items, sundries, furniture, china, glassware and utensils for the facilities located in the Tonto natural bridge state park.

X. The Arizona state parks board is exempt from this chapter for the purchase, production, promotion, distribution and sale of publications, souvenirs and sundry items obtained and produced for resale.

Y. The Arizona state schools for the deaf and the blind are exempt from this chapter for the purchase of textbooks and when purchasing products through a cooperative that is organized and operates in accordance with state law if such products are not available on a statewide contract and are related to the operation of the schools or are products for which special discounts are offered for educational institutions.

Z. Expenditures of monies in the morale, welfare and recreational fund established by section 26-153 are exempt from this chapter.

AA. Notwithstanding section 41-2534, the director of the state department of corrections may contract with local medical providers in counties with a population of less than four hundred thousand persons for the following purposes:

To acquire hospital and professional medical services for inmates who are incarcerated in state department of corrections facilities that are located in those counties.
To ensure the availability of emergency medical services to inmates in all counties by contracting with the closest medical facility that offers emergency treatment and stabilization.

BB. The department of environmental quality is exempt from this chapter for contracting for procurements relating to the water quality assurance revolving fund program established pursuant to title 49, chapter 2, article 5. The department shall engage in a source selection process that is similar to the procedures prescribed by this chapter. The department may contract for remedial actions with a single selection process. The exclusive remedy for disputes or claims relating to contracting pursuant to this subsection is as prescribed by article 9 of this chapter and the rules adopted pursuant to that article. All other procurement by the department shall be as prescribed by this chapter.

CC. The motor vehicle division of the department of transportation is exempt from this chapter for third-party authorizations pursuant to title 28, chapter 13, only if all of the following conditions exist:

The division does not pay any public monies to an authorized third party.
Exclusivity is not granted to an authorized third party.
The director has complied with the requirements prescribed in title 28, chapter 13 in selecting an authorized third party.

DD. This section does not exempt third-party authorizations pursuant to title 28, chapter 13 from any other applicable law.

EE. The state forester is exempt from this chapter for purchases and contracts relating to wildland fire suppression and pre-positioning equipment resources and for other activities related to combating wildland fires and other unplanned risk activities, including fire, flood, earthquake, wind and hazardous material responses. All other procurement by the state forester shall be as prescribed by this chapter.

FF. The cotton research and protection council is exempt from this chapter for procurements.

GG. The Arizona commerce authority is exempt from this chapter, except article 10 for the purpose of cooperative purchases. The authority shall adopt policies, procedures and practices, in consultation with the department of administration, that are similar to and based on the policies and procedures prescribed by this chapter for the purpose of increased public confidence, fair and equitable treatment of all persons engaged in the process and fostering broad competition while accomplishing flexibility to achieve the authority's statutory requirements. The authority shall make its policies, procedures and practices available to the public. The authority may exempt specific expenditures from the policies, procedures and practices.

HH. The Arizona exposition and state fair board is exempt from this chapter for contracts for professional entertainment.

II. This chapter does not apply to purchases of water, gas or electric utilities.

JJ. This chapter does not apply to professional certifications, professional memberships and conference registrations.

KK. The department of gaming is exempt from this chapter for problem gambling treatment services contracts with licensed behavioral health professionals.

LL. This chapter does not apply to contracts for credit reporting services.

MM. This chapter does not apply to contracts entered into by the department of child safety:

With a provider of family foster care pursuant to section 8-503.
With an eligible entity as defined by Public Law 105-285, section 673(1)(A)(i), as amended, for designated community services block grant program monies and any other monies given to the eligible entity that accomplishes the purpose of Public Law 105-285, section 672.
For services pursuant to title 36, chapter 29, article 1 and as set forth in the approved medicaid state plan.

NN. This chapter does not apply to contracts entered into by the department of economic security with a financial institution to serve as a program manager and depository under section 46-903.

§ 41-2502 Determinations

Written determinations required by this chapter shall be retained in the appropriate official records file of the director.

§ 41-2503 Definitions

In this chapter, unless the context otherwise requires:

"Architect services" means those professional architect services that are within the scope of architectural practice as provided in title 32, chapter 1.
"Business" means any corporation, partnership, individual, sole proprietorship, joint stock company, joint venture or other private legal entity.
"Change order" means a written order that is signed by a procurement officer and that directs the contractor to make changes that the changes clause of the contract authorizes the procurement officer to order.
"Construction":

(a) Means the process of building, altering, repairing, improving or demolishing any public structure or building or other public improvements of any kind to any public real property.

(b) Does not include:

(i) The routine operation, routine repair or routine maintenance of existing facilities, structures, buildings or real property.

(ii) The investigation, characterization, restoration or remediation due to an environmental issue of existing facilities, structures, buildings or real property.

"Construction-manager-at-risk" means a project delivery method in which:

(a) There is a separate contract for design services and a separate contract for construction services, except that instead of a single contract for construction services, the purchasing agency may elect separate contracts for preconstruction services during the design phase, for construction during the construction phase and for any other construction services.

(b) The contract for construction services may be entered into at the same time as the contract for design services or at a later time.

(i) Sequential with the entire design complete before construction commences.

(ii) Concurrent with the design produced in two or more phases and construction of some phases commencing before the entire design is complete.

(d) Finance services, maintenance services, operations services, preconstruction services and other related services may be included.

"Construction services" means either of the following for construction-manager-at-risk, design-build and job-order-contracting project delivery methods:

(a) Construction, excluding services, through the construction-manager-at-risk or job-order-contracting project delivery methods.

(b) A combination of construction and, as elected by the purchasing agency, one or more related services, such as finance services, maintenance services, operations services, design services and preconstruction services, as those services are authorized in the definitions of construction-manager-at-risk, design-build or job-order-contracting in this section.

"Contract" means all types of state agreements, regardless of what they may be called, for the procurement of materials, services, construction, construction services or the disposal of materials.
"Contract modification" means any written alteration in the terms and conditions of any contract accomplished by mutual action of the parties to the contract.
"Contractor" means any person who has a contract with a state governmental unit.
"Data" means documented information, regardless of form or characteristic.
"Department" means the department of administration.
"Design-bid-build" means a project delivery method in which:

(a) There is a sequential award of two separate contracts.

(b) The first contract is for design services.

(d) Design and construction of the project are in sequential phases.

(e) Finance services, maintenance services and operations services are not included.

"Design-build" means a project delivery method in which:

(a) There is a single contract for design services and construction services, except that instead of a single contract for design services and construction services, the purchasing agency may elect separate contracts for preconstruction services and design services during the design phase, for construction and design services during the construction phase and for any other construction services.

(b) Design and construction of the project may be either:

(i) Sequential with the entire design complete before construction commences.

(ii) Concurrent with the design produced in two or more phases and construction of some phases commencing before the entire design is complete.

(c) Finance services, maintenance services, operations services, preconstruction services and other related services may be included.

"Design professional" means an individual or firm that is registered by the state board of technical registration pursuant to title 32, chapter 1 to practice architecture, engineering, geology, landscape architecture or land surveying or any combination of those professions and any person employed by the registered individual or firm.
"Design requirements":

(a) Means at a minimum the purchasing agency's written description of the project or service to be procured, including:

(i) The required features, functions, characteristics, qualities and properties.

(ii) The anticipated schedule, including start, duration and completion.

(iii) The estimated budgets applicable to the specific procurement for design and construction and, if applicable, for operation and maintenance.

(b) May include:

(i) Drawings and other documents illustrating the scale and relationship of the features, functions and characteristics of the project, which shall all be prepared by a design professional who is registered pursuant to section 32-121.

(ii) Additional design information or documents that the purchasing agency elects to include.

"Design services" means architect services, engineer services or landscape architect services.
"Designee" means a duly authorized representative of the director.
"Director" means the director of the department of administration.
"Employee" means an individual drawing a salary from a state governmental unit, whether elected or not, and any noncompensated individual performing personal services for any state governmental unit.
"Engineer services" means those professional engineer services that are within the scope of engineering practice as provided in title 32, chapter 1.
"Finance services" means financing for a construction services project.
"General services administration contract" means contracts awarded by the United States government general services administration.
"Grant" means the furnishing of financial or other assistance, including state funds or federal grant funds, by any state governmental unit to any person for the purpose of supporting or stimulating educational, cultural, social or economic quality of life.
"Job-order-contracting" means a project delivery method in which:

(a) The contract is a requirements contract for indefinite quantities of construction.

(b) The construction to be performed is specified in job orders issued during the contract.

(c) Finance services, maintenance services, operations services, preconstruction services, design services and other related services may be included.

"Landscape architect services" means those professional landscape architect services that are within the scope of landscape architectural practice as provided in title 32, chapter 1.
"Maintenance services" means routine maintenance, repair and replacement of existing facilities, structures, buildings or real property.
"Materials":

(a) Means all property, including equipment, supplies, printing, insurance and leases of property.

(b) Does not include land, a permanent interest in land or real property or leasing space.

"Operations services" means routine operation of existing facilities, structures, buildings or real property.
"Owner" means a state purchasing agency or state governmental unit.
"Person" means any corporation, business, individual, union, committee, club, other organization or group of individuals.
"Preconstruction services" means services and other activities during the design phase.
"Procurement":

(a) Means buying, purchasing, renting, leasing or otherwise acquiring any materials, services, construction or construction services.

(b) Includes all functions that pertain to obtaining any materials, services, construction or construction services, including description of requirements, selection and solicitation of sources, preparation and award of contract, and all phases of contract administration.

"Procurement officer":

(a) Means any person duly authorized to enter into and administer contracts and make written determinations with respect to the contracts.

(b) Includes an authorized representative acting within the limits of the authorized representative's authority.

"Purchasing agency" means any state governmental unit that is authorized by this chapter or rules adopted pursuant to this chapter, or by way of delegation from the director, to enter into contracts.
"Services":

(a) Means the furnishing of labor, time or effort by a contractor or subcontractor that does not involve the delivery of a specific end product other than required reports and performance.

(b) Does not include employment agreements or collective bargaining agreements.

"Significant procurement role":

(a) Means any role that includes any of the following duties:

(i) Participating in the development of a procurement.

(ii) Participating in the development of an evaluation tool.

(iii) Approving a procurement or an evaluation tool.

(iv) Soliciting quotes greater than ten thousand dollars for the provision of materials, services or construction.

(v) Serving as a technical advisor or an evaluator who evaluates a procurement.

(vi) Recommending or selecting a vendor that will provide materials, services or construction to this state.

(vii) Serving as a decision maker or designee on a protest or an appeal by a party regarding an agency procurement selection or decision.

(b) Does not include making decisions on developing specifications and the scope of work for a procurement if the decision is based on the application of commonly accepted industry standards or known published standards of the agency as applied to the project, services, goods or materials.

"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.
"Subcontractor" means a person who contracts to perform work or render service to a contractor or to another subcontractor as a part of a contract with a state governmental unit.
"Using agency" means any state governmental unit that uses any materials, services or construction procured under this chapter.

§ 41-2504 Supplementary general principles of law applicable

Unless displaced by the particular provisions of this chapter, the principles of law and equity, including the uniform commercial code of this state, the common law of contracts as applied in this state and law relative to agency, fraud, misrepresentation, duress, coercion and mistake supplement the provisions of this chapter.

Article 2 Procurement Organization

§ 41-2511 Authority of the director

A. Except as otherwise provided in this chapter, the director may adopt rules, consistent with this chapter, governing the procurement and management of all materials, services and construction to be procured by this state and the disposal of materials.

B. The director shall serve as the central procurement officer of this state.

C. Except as otherwise provided in this chapter, the director shall, in accordance with rules adopted under this chapter:

Procure or supervise the procurement of all materials, services and construction needed by this state.
Establish guidelines for the management of all inventories of materials belonging to this state.
Sell, trade or otherwise dispose of surplus materials belonging to this state.
Establish and maintain programs for the inspection, testing and acceptance of materials, services and construction.
Establish and maintain programs to ensure procurement compliance with this chapter and applicable rules.
Establish and maintain a mandatory procurement training and certification program to ensure consistency in procurement practices for those authorized to perform procurement functions under this chapter.
Employ staff as necessary to perform the duties prescribed in this chapter.
Establish procurement offices as the director determines necessary to maintain an effective and efficient program of procurement administration.
Provide consultation to state agency management in all aspects of procurement to increase efficiency and economy in state agencies by improving the methods of procurement with full recognition of the requirements and needs of management.
Enter into agreements with any state government unit or political subdivision of this state or agency of a political subdivision of this state to furnish procurement administration services and facilities of the department. Unless monies have been appropriated by the legislature for this purpose, any agreement shall provide for reimbursement to this state of the actual cost of the services and facilities furnished, as determined by the director.
Enter into agreements with the attorney general for dedicated legal resources to support any state governmental unit in procurement legal matters, including negotiations, protests and appeals.

§ 41-2512 Delegation of authority or functions by the director

The director may delegate authority or specific procurement functions to any state governmental unit.

§ 41-2513 Authority to contract for certain services

A. For the purpose of procuring the services of clergy, certified public accountants, legal counsel pursuant to section 41-192, subsection D, physicians or dentists as defined by the laws of this state, any state governmental unit may act as a purchasing agency and contract on its own behalf for such services, subject to this chapter and rules adopted by the director.

B. In accordance with section 41-192, subsection D and notwithstanding any contrary statute, no contract for the services of legal counsel may be awarded without the approval of the attorney general.

C. The auditor general shall approve state agency contracting for financial and compliance auditing services except if specific statutory authority is otherwise provided. The auditor general shall ensure that such contract audits are conducted in accordance with generally accepted governmental auditing standards. An audit shall not be accepted until it has been approved by the auditor general.

D. The department may approve all information technology purchases exceeding twenty-five thousand dollars for a budget unit as defined in section 18-101. Purchases shall not be artificially divided to avoid review.

E. Payment for any services, including those services described in subsections A, B and C of this section, procured under this chapter shall not be made unless pursuant to a fully approved written contract.

§ 41-2514 State procurement rules

A. The director may adopt and issue rules pursuant to chapter 6 of this title to carry out the purposes of this chapter.

B. Except by mutual consent of the parties to the contract, no rule promulgated under this chapter may change any commitment, right or obligation of this state or of a contractor under a contract in existence on the effective date of the rule.

§ 41-2515 Collection of data concerning public procurement

All using agencies shall furnish such reports as the director may require concerning usage, needs and stocks on hand, and the director may prescribe forms and procurement systems for use by the using agencies in requisitioning, ordering and reporting of materials, services and construction.

§ 41-2516 Procurement advisory groups or evaluation committees

A. The director may appoint advisory groups or evaluation committees to assist with respect to specifications, solicitation evaluations or procurement in specific areas and with respect to any other matters within the authority of the director.

B. Members of advisory groups or evaluation committees are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

§ 41-2517 Procurement officers and procurement employees; violation; classification; exception

A. It is unlawful for a procurement officer or an employee having a significant procurement role to accept any position or have employment discussions with a person or firm lobbying or potentially responding to the solicitation beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending at the time of contract award. It is unlawful for a procurement officer or an employee having a significant procurement role to accept any position or have employment discussions with the successful offeror or offerors and their lobbyists beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending one year after the purchased materials are delivered or the purchase of services or construction begins, if the procurement officer or employee had a significant procurement role in the particular procurement.

B. It is unlawful for a procurement officer or an employee having a significant procurement role to solicit an employment opportunity, regardless of who would receive such an opportunity, from any person or firm lobbying or potentially responding to a solicitation for the procurement of materials, services or construction beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending at the time of contract award. It is unlawful for a procurement officer or an employee having a significant procurement role to solicit an employment opportunity, regardless of who would receive such an opportunity, from the successful offeror or offerors and their lobbyists beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending one year after the purchased materials are delivered or the purchase of services or construction begins, if the procurement officer or employee had a significant role in the particular procurement.

C. It is unlawful for a person or firm lobbying or potentially responding to a solicitation for the procurement of materials, services or construction to offer employment to a procurement officer, a procurement employee or an employee having a significant procurement role beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending at the time of contract award. It is unlawful for the successful offeror or offerors and their lobbyists to offer employment to a procurement officer, a procurement employee or an employee having a significant procurement role beginning on signature of the first nondisclosure agreement pertaining to a particular solicitation or at the time of request for a sole source procurement or competition impracticable procurement and ending one year after the purchased materials are delivered or the purchase of services or construction begins, if the procurement officer or employee had a significant role in the particular procurement.

D. The director of the department of administration may waive any or all of the waiting period required pursuant to subsections A, B and C of this section in excess of twenty-four months for a procurement officer or an employee with a significant procurement role if the period of time that follows the signature of the nondisclosure agreement exceeds twenty-four months. A procurement officer or an employee seeking a waiver shall make a written request to the officer's or employee's state governmental unit director, and the director of the state governmental unit shall forward the request with a written recommendation to the director of the department of administration. The director of the department of administration shall provide a written decision and justification within fifteen business days after the receipt of the complete request. The director of the department of administration may not approve waiver requests for matters still in evaluation or within six months following the contract award. If the requesting party is the director or a deputy director of a state governmental unit, the request for a waiver and all written materials, including a director recommendation, must be forwarded to the governor for a final decision, except that the director may not make any recommendation or determination on the director's own request.

E. In response to a written request from an employee seeking clarification on whether the employee has played a significant role in a procurement, the director shall issue a determination in writing within fifteen days after receiving the request. The director may make a determination in writing that this section and section 41-753, subsection D do not apply if a particular solicitation, sole source procurement or competition impracticable procurement has been canceled or is associated with the privatization of existing state services that would result in the elimination of the position in state service of an employee with a significant procurement role. The director may delegate the authority to make determinations pursuant to this subsection to a director of a state agency. An agency director or agency deputy director may request a determination from the office of the governor regarding whether the agency director or agency deputy director played a significant role in a particular procurement for the purposes of the one-year employment restriction, and the office of the governor shall make a determination within thirty days after the receipt of the written request.

F. It is unlawful for a procurement officer or an employee who was previously employed by a person or firm responding to a solicitation to serve in a significant procurement role for a period of one year following the person's previous employment.

G. Beginning October 1, 2014, if an agency uses a qualified vendor list of persons or entities that are eligible to be selected to design, develop, implement or construct any form of project associated with the list, any procurement officer who was assigned to work evaluating or approving the vendor list or any employee having a significant procurement role in developing the vendor list shall not accept an offer of employment from or have employment discussions with a vendor on the list within one year after the initial publication of the list or accept an offer of employment from or have employment discussions with a newly added vendor within one year after the vendor is added to the original list. If a vendor from an approved list of qualified vendors is awarded a contract that is associated with the list, a procurement officer involved in selecting the vendor or an employee having a significant procurement role in selecting the vendor shall not accept an offer of employment from or have employment discussions with that vendor within one year after that vendor is awarded the contract.

H. On signature of a nondisclosure agreement pertaining to a particular solicitation, or at the time of a request for a sole source or competition impracticable procurement, a procurement officer or an employee having a significant role in the procurement shall provide written disclosure of any financial interest the officer or employee, or the spouse of the officer or employee, may hold.

I. A person who knowingly violates this section is guilty of a class 2 misdemeanor. On conviction the person is ineligible for appointment to or employment in a position in the state personnel system for a period of five years and, if the person is an employee of this state at the time of conviction, is subject to suspension for not less than ninety days or dismissal.

J. This section does not apply to a procurement officer or employee who in good faith relies on a determination issued by the director pursuant to subsection D of this section that the procurement officer or employee has not had a significant procurement role.

Article 3 Source Selection and Contract Formation

§ 41-2531 Definitions

In this article, unless the context otherwise requires:

"Bidder prequalification" means determining in accordance with rules adopted pursuant to this chapter that a prospective bidder or offeror satisfies the criteria for being included on the bidder's list.
"Cost-reimbursement contract" means a contract under which a contractor is reimbursed for costs which are reasonable, allowable and allocable in accordance with the contract terms and the provisions of this chapter, and paid a fee, if provided for in the contract.
"Demonstration project" means a project in which a vendor supplies a service or material to this state for which the state does not pay but for which this state may be obligated to provide routine support such as utility cost and operating personnel.
"Established catalogue price" means the price included in a catalogue, price list, schedule or other form that:

(a) Is regularly maintained by a manufacturer, distributor or contractor.

(b) Is either published or otherwise available for inspection by customers.

(c) States prices at which sales are currently or were last made to a significant number of any category of buyers or buyers constituting the general buying public for the materials or services involved.

"Invitation for bids" means all documents, whether attached or incorporated by reference, which are used for soliciting bids in accordance with the procedures prescribed in section 41-2533.
"Multistep sealed bidding" means a two phase process consisting of a technical first phase composed of one or more steps in which bidders submit unpriced technical offers to be evaluated by this state and a second phase in which those bidders whose technical offers are determined to be acceptable during the first phase have their price bids considered.
"Paper" means newspaper, high grade office paper, fine paper, bond paper, offset paper, xerographic paper, duplicator paper and related types of cellulosic material containing not more than ten per cent by weight or volume of noncellulosic material such as laminates, binders, coatings or saturants.
"Paper product" means paper items or commodities, including paper napkins, towels, corrugated paper and related types of cellulosic products containing not more than ten per cent by weight or volume of noncellulosic material such as laminates, binders, coatings or saturates.
"Post-consumer material" means a discard generated by a business or residence that has fulfilled its useful life. Post-consumer material does not include discards from industrial or manufacturing processes.
"Purchase description" means the words used in a solicitation to describe the materials, services or construction for purchase and includes specifications attached to, or made a part of, the solicitation.
"Recycled paper" means paper products which have been manufactured from materials otherwise destined for the waste stream and which contain at least forty per cent recovered wastepaper with ten per cent of that being post-consumer material.
"Request for information" means all documents issued to vendors for the sole purpose of seeking information about the availability in the commercial marketplace of materials or services.
"Request for proposals" means all documents, whether attached or incorporated by reference, which are used for soliciting proposals in accordance with procedures prescribed in section 41-2534.
"Responsible bidder or offeror" means a person who has the capability to perform the contract requirements and the integrity and reliability which will assure good faith performance.
"Responsive bidder" means a person who submits a bid which conforms in all material respects to the invitation for bids.
"Unsolicited proposal" means a written proposal that is submitted on the initiative of the offeror for the purposes of obtaining a contract with this state and that is not in response to a formal or informal request from this state.
"Wastepaper" means recyclable paper and paperboard, including high grade office paper, computer paper, fine paper, bond paper, offset paper, xerographic paper, duplicator paper and corrugated paper.

§ 41-2532 Methods of source selection

Unless otherwise authorized by law, all state contracts shall be awarded by competitive sealed bidding as provided in section 41-2533 or as provided in sections 41-2534 through 41-2538 and sections 41-2554, 41-2558, 41-2559, 41-2572, 41-2578, 41-2579, 41-2581 and 41-2636.

§ 41-2533 Competitive sealed bidding

A. Contracts shall be awarded by competitive sealed bidding except as otherwise provided in section 41-2532.

B. An invitation for bids shall be issued and shall include a purchase description and all contractual terms and conditions applicable to the procurement.

C. Adequate public notice of the invitation for bids shall be given a reasonable time before the date set forth in the invitation for the opening of bids, in accordance with rules adopted by the director. The notice may include publication one or more times in a newspaper of general circulation a reasonable time before bid opening. If the invitation for bids is for the procurement of services other than those described in sections 41-2513, 41-2578, 41-2579 and 41-2581, the notice shall include publication in a single newspaper or in multiple newspapers within this state. The publication shall be not less than two weeks before bid opening and shall be circulated within the affected governmental jurisdiction. The notice may also be posted at a designated site on a worldwide public network of interconnected computers.

D. Bids shall be opened publicly at the time and place designated in the invitation for bids. The amount of each bid, and such other relevant information as may be specified by rule, together with the name of each bidder shall be recorded. This record shall be open to public inspection at the bid opening in a manner prescribed by rule. The bids shall not be open for public inspection until after a contract is awarded. To the extent the bidder designates and the state concurs, trade secrets or other proprietary data contained in the bid documents shall remain confidential in accordance with rules adopted by the director.

E. Bids shall be unconditionally accepted without alteration or correction, except as authorized in this chapter. Bids shall be evaluated based on the requirements set forth in the invitation for bids, including criteria to determine acceptability such as inspection, testing, quality, workmanship, delivery and suitability for a particular purpose, as prescribed in rules adopted by the director. Evaluation criteria shall not be used for construction and no criteria may be used in bid evaluation that are not set forth in the invitation for bids.

F. The correction or withdrawal of erroneous bids before or after bid opening, based on bid mistakes, may be permitted in accordance with rules adopted by the director. After bid opening, no corrections in bid prices or other provisions of bids prejudicial to the interest of this state or fair competition shall be permitted. Except as otherwise provided by rule, all decisions to permit the correction or withdrawal of bids, or to cancel awards or contracts based on bid mistakes, shall be supported by a written determination made by the director.

G. The contract shall be awarded to the lowest responsible and responsive bidder whose bid conforms in all material respects to the requirements and criteria set forth in the invitation for bids. The amount of any applicable transaction privilege or use tax of a political subdivision of this state is not a factor in determining the lowest bidder. If all bids for a construction project exceed available monies as certified by the appropriate fiscal officer, and the low responsive and responsible bid does not exceed such monies by more than five per cent, the director may in situations in which time or economic considerations preclude resolicitation of work of a reduced scope negotiate an adjustment of the bid price, including changes in the bid requirements, with the low responsive and responsible bidder, to bring the bid within the amount of available monies.

H. The multistep sealed bidding method may be used if it is not practicable to initially prepare a definitive purchase description that is suitable to permit an award based on competitive sealed bidding. An invitation for bids may be issued requesting the submission of technical offers to be followed by an invitation for bids limited to those bidders whose offers are determined to be technically acceptable under the criteria set forth in the first solicitation, except that the multistep sealed bidding method may not be used for construction contracts.

I. If the price of a recycled paper product that conforms to specifications is within five per cent of a low bid product that is not recycled and the recycled product bidder is otherwise the lowest responsible and responsive bidder, the award shall be made to the bidder offering the recycled product. The director may adopt rules requiring a five per cent preference for other products made from recycled materials.

§ 41-2534 Competitive sealed proposals

A. A contract for materials or services may be entered into by competitive sealed proposals. This section does not apply to procurement of construction, construction services or specified professional services pursuant to section 41-2537, 41-2578, 41-2579 or 41-2581. Construction services shall be procured pursuant to section 41-2537, 41-2578 or 41-2579.

B. Proposals shall be solicited through a request for proposals.

C. Adequate public notice of the request for proposals shall be given in the same manner as provided in section 41-2533.

D. Proposals shall be opened publicly at the time and place designated in the request for proposals. The name of each offeror shall be recorded in accordance with rules adopted by the director. All other information contained in the proposals shall be confidential so as to avoid disclosure of contents prejudicial to competing offerors during the process of negotiation. The proposals shall be open for public inspection after contract award. To the extent the offeror designates and the state concurs, trade secrets or other proprietary data contained in the offer documents shall remain confidential in accordance with rules adopted by the director.

E. The request for proposals shall state the relative importance of price and other evaluation factors. Specific numerical weighting is not required.

F. As provided in the request for proposals, and under rules adopted by the director, discussions may be conducted with responsible offerors who submit proposals determined to be reasonably susceptible to being selected for award for the purpose of clarification to ensure full understanding of the solicitation requirements and to permit revision of offers. Offerors shall be accorded fair treatment with respect to any opportunity for discussion. Revisions may be permitted after submission and before award. If discussions are conducted, all offerors who have submitted proposals that are determined by the procurement officer to be reasonably susceptible to being selected for award shall be invited to submit a best and final offer. In conducting discussions, there shall be no disclosure of any information derived from proposals submitted by competing offerors.

G. The award shall be made to the responsible offeror whose proposal is determined in writing to be the most advantageous to this state taking into consideration the evaluation factors set forth in the request for proposals. No other factors or criteria may be used in the evaluation. The amount of any applicable transaction privilege or use tax of a political subdivision of this state is not a factor in determining the most advantageous proposal. The contract file shall contain the basis on which the award is made.

§ 41-2535 Procurements not exceeding a prescribed amount; small businesses; simplified construction procurement program

A. Any procurement that does not exceed the aggregate dollar amount of one hundred thousand dollars may be made in accordance with rules adopted by the director, except that the procurements shall be made with such competition as is practicable under the circumstances.

B. Any procurement that does not exceed the aggregate dollar amount of less than one hundred thousand dollars shall be restricted, if practicable, to small businesses as defined in rules adopted by the director. The procurement officer shall rotate the small business solicited to compete for any procurement of less than one hundred thousand dollars. If it is impracticable to restrict a particular procurement to small businesses, the procurement officer shall make a determination setting forth the reasons and place it in the contract file.

C. Procurement requirements shall not be artificially divided or fragmented so as to constitute a purchase under this section and to circumvent the source selection procedures required by section 41-2533 or 41-2534 or be artificially combined to circumvent this section.

D. A procurement involving construction not exceeding one hundred thousand dollars may be made pursuant to rules adopted by the director in accordance with this section that shall be known as the simplified construction procurement program. At a minimum the rules shall require that:

A list be maintained of persons who desire to receive solicitations to bid on construction projects to which additions shall be permitted throughout the year.
The list of persons be available for public inspection.
Agreements for construction be on forms approved by the director.
All information submitted by bidders pursuant to this section be confidential according to section 41-2533, subsection D.
All bids for construction be opened at a public opening.
All persons desiring to submit bids be treated equitably and the information related to each project be available to all eligible persons.
Competition for construction projects under the simplified construction procurement program be encouraged to the maximum extent possible.

§ 41-2536 Sole source procurement

A contract may be awarded for a material, service or construction item without competition if the director determines in writing that there is only one source for the required material, service or construction item. The director may require the submission of cost or pricing data in connection with an award under this section. Sole source procurement shall be avoided, except when no reasonable alternative sources exist. A written determination of the basis for the sole source procurement shall be included in the contract file.

§ 41-2537 Emergency procurements

Notwithstanding any other provision of this chapter, the director may make or authorize others to make emergency procurements if there exists a threat to public health, welfare or safety or if a situation exists which makes compliance with section 41-2533, 41-2534, 41-2578, 41-2579 or 41-2581 impracticable, unnecessary or contrary to the public interest as defined in rules adopted by the director, except that such emergency procurements shall be made with such competition as is practicable under the circumstances. A written determination of the basis for the emergency and for the selection of the particular contractor shall be included in the contract file.

§ 41-2538 Competitive selection procedures for certain professional services

A. The services specified in section 41-2513 shall be procured in accordance with this section, except as authorized under section 41-2535, 41-2536 or 41-2537.

B. Persons engaged in providing the types of services specified in section 41-2513 may submit statements of qualifications and expressions of interest in providing such types of services. The director may specify a uniform format for statements of qualifications. Persons may amend these statements at any time by filing a new statement.

C. Adequate notice of the need for such services shall be given by the purchasing agency through a request for proposals. The request for proposals shall describe the services required and list the type of information and data required of each offeror.

D. The head of the purchasing agency or a designee of such officer may conduct discussions with any offerors who submit a proposal to determine the offeror's qualifications for further consideration. Discussions shall not disclose any information derived from proposals submitted by other offerors.

E. The award shall be made to the offeror determined in writing by the head of the purchasing agency or a designee of such officer to be best qualified based on the evaluation factors set forth in the request for proposals and after a written determination that the compensation is fair and reasonable. Selection may be made pursuant to the provisions of this section without requiring priced proposals, but if price is included in proposals submitted, no contract may be awarded solely on the basis of price.

§ 41-2539 Cancellation of invitation for bids or requests for proposals

An invitation for bids, a request for proposals or other solicitation may be cancelled or any or all bids or proposals may be rejected in whole or in part as may be specified in the solicitation if it is in the best interests of this state. The reasons for the cancellation or rejection shall be made part of the contract file.

§ 41-2540 Responsibility of bidders and offerors

A. A written determination of nonresponsibility of a bidder or offeror shall be made in accordance with rules adopted by the director. The unreasonable failure of a bidder or offeror to promptly supply information in connection with an inquiry with respect to responsibility shall be grounds for a determination of nonresponsibility with respect to the bidder or offeror. A finding of nonresponsibility shall not be construed as a violation of the rights of any person.

B. Information furnished by a bidder or offeror pursuant to this section shall not be disclosed outside of the office of the director or the purchasing agency without prior written consent by the bidder or offeror except to law enforcement agencies.

§ 41-2541 Prequalification of contractors

Prospective contractors may be prequalified for particular types of materials, services and construction. Prospective contractors have a continuing duty to provide the director with information on any material change affecting the basis of prequalification. Solicitation mailing lists of potential contractors shall include the prequalified contractors.

§ 41-2542 Bid and contract security

The director may require, in accordance with rules adopted by the director, the submission of security to guarantee faithful bid and contract performance. In determining the amount and type of security required for each contract, the director shall consider the nature of the performance and the need for future protection to this state. The requirement for security must be included in the invitation for bids or request for proposals.

§ 41-2543 Cost or pricing data

A. The submission of current cost or pricing data may be required in connection with an award in situations in which analysis of the proposed price is essential to determine that the price is reasonable and fair. A contractor shall, except as provided in subsection C, submit current cost or pricing data and shall certify that, to the best of the contractor's knowledge and belief, the cost or pricing data submitted was accurate, complete and current as of a mutually determined specified date before the date of either:

The pricing of any contract awarded by competitive sealed proposals or pursuant to the sole source procurement authority, if the total contract price is expected to exceed an amount established by department rules.
The pricing of any change order or contract modification which is expected to exceed an amount established by department rules.

B. Any contract, change order or contract modification under which a certificate is required shall contain a provision that the price to this state shall be adjusted to exclude any significant amounts by which this state finds that the price was increased because the contractor-furnished cost or pricing data was inaccurate, incomplete or not current as of the date agreed on between the parties. Such adjustment by this state may include profit or fee.

C. The requirements of this section need not be applied to contracts if any of the following applies:

The contract price is based on adequate price competition.
The contract price is based on established catalogue prices or market prices.
Contract prices are set by law or rule.
It is determined in writing in accordance with rules adopted by the director that the requirements of this section may be waived, and the reasons for the waiver are stated in writing.

§ 41-2544 Types of contracts

Subject to the limitations of this section, any type of contract that will promote the best interests of this state may be used, except that the use of a cost-plus-a-percentage-of-cost contract is prohibited.

§ 41-2546 Multiterm contracts

A. Unless otherwise provided by law, a contract for materials or services may be entered into for a period of time up to five years and a contract for job-order-contracting construction services may also be entered into for a period of time up to five years, as deemed to be in the best interest of this state, if the term of the contract and conditions of renewal or extension, if any, are included in the solicitation and monies are available for the first fiscal period at the time of contracting. Notwithstanding any other law, a contract, including contracts not otherwise subject to this chapter, may be entered into for materials or services for a period of time exceeding five years if, under rules adopted pursuant to this chapter, the director determines in writing that such a contract would be advantageous to this state. Payment and performance obligations for succeeding fiscal periods are subject to the availability and appropriation of monies.

B. Before the use of a multiterm contract, it shall be determined in writing that:

Estimated requirements cover the period of the contract and are reasonable and continuing.
Such a contract will serve the best interests of this state by encouraging effective competition or otherwise promoting economies in state procurement.

C. If monies are not appropriated or otherwise made available to support continuation of performance in a subsequent fiscal period, the contract shall be cancelled and the contractor may only be reimbursed for the reasonable 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. The cost of cancellation may be paid from any appropriations available for such purposes.

§ 41-2547 Right to inspect plant

The state may at reasonable times inspect the part of the plant or place of business of a contractor or any subcontractor which is related to the performance of any contract awarded or to be awarded by this state.

§ 41-2548 Right to audit records

A. The state may, at reasonable times and places, audit the books and records of any person who submits cost or pricing data as provided in section 41-2543 to the extent that the books and records relate to the cost or pricing data. Any person who receives a contract, change order or contract modification for which cost or pricing data is required shall maintain the books and records that relate to the cost or pricing data for five years after the completion of the contract pursuant to section 35-214.

B. The state is entitled to audit the books and records of a contractor or any subcontractor under any contract or subcontract to the extent that the books and records relate to the performance of the contract or subcontract. The books and records shall be maintained by the contractor for a period of five years after the completion of the prime contract pursuant to section 35-214 and by the subcontractor for a period of five years after the completion of the subcontract pursuant to section 35-214.

§ 41-2549 Reporting of anticompetitive practices

If for any reason collusion or other anticompetitive practices are suspected among any bidders or offerors, a notice of the relevant facts shall be transmitted to the director and the attorney general. This section does not require a law enforcement agency conducting an investigation into such practices to convey such notice to the director.

§ 41-2550 Retention of procurement records

All procurement records shall be retained and disposed of in accordance with records retention guidelines and schedules approved by the Arizona state library, archives and public records.

§ 41-2551 Record of procurement actions

A. The director shall maintain a record listing all contracts in excess of an amount to be determined by regulation made under section 41-2536 or 41-2537 for a minimum of five years. The record shall contain:

Each contractor's name.
The amount and type of each contract.
A listing of the materials, services or construction procured under each contract.

B. The record shall be available for public inspection.

§ 41-2552 Change order

A change order exceeding an amount or percentage established by regulation may be executed only after the director determines in writing that the change order is advantageous to this state.

§ 41-2554 Procurement of earth moving, material handling, road maintenance and construction equipment; definitions

A. Notwithstanding the criteria for contract award prescribed in section 41-2533, a contract for earth moving, material handling, road maintenance and construction equipment shall be awarded to the lowest responsible and responsive bidder whose bid conforms in all material respects to the requirements and criteria set forth in the invitation for bids, which shall include as price evaluation criteria the total life cycle cost including residual value of the earth moving, material handling, road maintenance and construction equipment and such other additional evaluation factors set forth in the invitation for bids. No factors or criteria may be used in the evaluation of bids for earth moving, material handling, road maintenance and construction equipment, other than those specified in the invitation for bid. Additional evaluation factors shall include, to the extent practicable, outright purchase. The contract award shall be based on the price evaluation criteria deemed by the state to be most advantageous to the state. Procedures for awarding contracts for earth moving, material handling, road maintenance and construction equipment pursuant to this subsection shall be the same as those prescribed in section 41-2533.

B. Notwithstanding the criteria for contract award prescribed in section 41-2534, a contract for earth moving, material handling, road maintenance and construction equipment shall be awarded to the responsible offeror whose proposal is determined in writing to be the most advantageous to the state. The evaluation factors set forth in the request for proposals shall include the total life cycle cost including residual value of each proposal and such other additional evaluation factors set forth in the request for proposals. No factors or criteria may be used in the evaluation of proposals for earth moving, material handling, road maintenance and construction equipment, other than those specified in the request for proposal. Additional evaluation factors set forth in the request for proposal shall include, to the extent practicable, outright purchase. The contract award shall be based on the price evaluation criteria deemed by the state to be most advantageous to the state. Procedures for awarding contracts for earth moving, material handling, road maintenance and construction equipment pursuant to this subsection shall be the same as those prescribed in section 41-2534.

C. The minimum unit list price for earth moving, material handling, road maintenance and construction equipment shall be adjusted annually by the consumer price index, United States average.

D. As used in this section:

"Earth moving, material handling, road maintenance, and construction equipment" means a track-type tractor, motor grader, excavator, landfill compactor, wheel tractor scraper, off-highway truck, wheel loader or track loader, having a published manufacturer's minimum unit list price of fifty thousand dollars or more and a minimum expected life cycle of three years.
"Outright purchase" means the initial cost to the state for the earth moving, material handling, road maintenance, and construction equipment, including all vendor charges and financing costs.
"Residual value" means the guaranteed minimum market value of the earth moving, material handling, road maintenance and construction equipment at the end of the life cycle of the earth moving, material handling, road maintenance and construction equipment being procured, as determined by a guaranteed minimum value offered by the vendor or other parties in its bid.
"Total life cycle cost" means total state costs and financing costs through the life cycle of the earth moving, material handling, road maintenance and construction equipment being purchased less residual value.
"Total state costs" means cost to the state for the earth moving, material handling, road maintenance and construction equipment including repair costs, present value of monies, vendor charges, and all other identifiable state costs that may be incurred.
"Vendor charges" means costs of all vendor support, materials, transportation and all other identifiable costs associated with the vendor's proposal or bid.
"Vendor support" means services provided by the vendor for items such as consulting, education and training.

§ 41-2555 Request for information

The procurement officer may issue a request for information to obtain data about services or materials available to meet a specific need. Adequate public notice as specified in section 41-2533 shall be provided.

§ 41-2556 Demonstration projects

A. A demonstration project may be undertaken if the director determines in writing that the project is innovative and unique. This state shall not be obligated to pay the contractor, or to procure or lease the services or materials supplied by the contractor. However, on the written request and justification by the agency and written determination by the director that it is in the best interest of this state, this state may pay the contractor for the demonstration project. The contract term shall not exceed two years. A request and written determination of the basis for the contract award shall be included in the contract file.

B. A contract to procure or lease services or materials previously supplied during a demonstration project shall be conducted under this article.

C. Except as otherwise provided by law, a contractor for a demonstration project shall not be precluded from participating as a bidder or offeror in a procurement for the services or materials supplied during a demonstration project.

§ 41-2557 Unsolicited proposals

A contract may be awarded based on an unsolicited proposal only if the director determines in writing that the conditions of either section 41-2536 or 41-2537 exist. The determination shall include all of the following:

The proposal is innovative and unique.
The proposal is not available without restriction from another source and does not closely resemble a similar product which is either available or pending in the industry.
The technical office of the purchasing agency receiving the proposal has sufficiently supported its recommendations with facts and circumstances that preclude competition.
The procurement officer has approved in writing the award of a contract based on the unsolicited proposal.

§ 41-2558 General services administration contracts

Notwithstanding sections 41-2533 and 41-2534, the director or the director's designee may evaluate general services administration contracts for materials and services. The director or the director's designee may authorize a purchasing agency to make purchases under a contract approved by the director or the director's designee without complying with the requirements prescribed in section 41-2533 or 41-2534 if the director or the director's designee determines all of the following apply:

The price is equal to or less than the contractor's current federal supply contract price.
The contractor has indicated in writing that the contractor is willing to extend the current federal supply contract pricing, terms and conditions.
The purchase order adequately identifies the federal supply contract on which the order is based.
It is cost-effective and in the best interests of this state.

§ 41-2559 Public-private partnership contracts

A. The director may enter into public-private partnership contracts to finance the technology needs of the purchasing agency. The funding for services under a public-private partnership contract entered into pursuant to this section shall be contingent on and computed according to established performance standards and shall be attributable to the successful implementation of the technology program for the period specified in the contract. The director may issue requests for information and requests for proposals to solicit private partners that are interested in providing programs under a contract entered into pursuant to this section.

B. Each request for proposals issued pursuant to this section shall require each private partner to propose specific performance improvements and measurement approaches to be used to measure the value delivered by the vendor technology solution. The director shall include an assessment of the proposed value of the vendor technology solution in its evaluation criteria to select the best value solution for the purchasing agency.

C. A contract entered into between the director and an automated systems vendor or an information technology vendor shall provide for payment of fees on a contractually specific amount based on the achievement of measured performance improvements that are mutually agreed to by the contractor and the director and monies for payment of these fees are not subject to legislative appropriation. The following are subject to review and approval by the director:

The terms of contracts entered into pursuant to this section relating to the measurement of the performance improvement attributable to the vendor technology program.
Payment of fees based on the achievement of the established performance measures.

D. On legislative authorization, the director of the department of administration and the director of the department of emergency and military affairs may issue a request for proposals and enter into a public-private partnership contract for military rotary wing aviation flight and maintenance training and services.

E. Before a public-private partnership contract is awarded pursuant to this section, the joint legislative budget committee staff shall be consulted with regard to the potential fiscal impact of the contract to the state. If the joint legislative budget committee staff finds a significant negative fiscal impact to the state, the staff shall report its findings to the joint legislative budget committee.

Article 4 Specifications

§ 41-2561 Definition

As used in this article, "specification" means any description of the physical or functional characteristics, or of the nature of a material, service or construction item. Specification may include a description of any requirement for inspecting, testing or preparing a material, service or construction item for delivery.

§ 41-2562 Duties of the director

A. The director shall establish guidelines governing the preparation, maintenance and content of specifications for materials, services and construction required by this state. The director shall prepare, issue, revise, maintain and monitor the use of specifications for materials, services and construction required by this state.

B. Notwithstanding the provisions of section 41-2501, all procurement solicitations for volatile organic compound containing commodities shall include a request for substitute commodities with lower or no volatile organic content. Substitute products shall not have increased toxicity compared to the original commodity.

§ 41-2563 Exempted services

Specifications for services procured under section 41-2513 may be prepared by a purchasing agency in accordance with this article and rules adopted under this article.

§ 41-2564 Relationship with using agencies

The director may obtain advice and assistance from using agencies in the development of specifications and may delegate in writing to a using agency the authority to prepare and use its own specifications.

§ 41-2565 Maximum practicable competition

All specifications shall seek to promote overall economy for the purposes intended and encourage competition in satisfying this state's needs and shall not be unduly restrictive.

§ 41-2566 Specifications prepared by architects and engineers

All specifications, including those prepared by architects, engineers, consultants and others for public contracts, shall seek to promote overall economy for the purposes intended and encourage competition in satisfying this state's needs and shall not be unduly restrictive.

§ 41-2567 Specifications for energy consumptive material

The director shall establish specifications based on national standards for considerations of energy conservation for the procurement of selected energy consumptive material.

§ 41-2568 Specifications for recycled materials

To the extent practicable, specifications shall emphasize functional or performance criteria which do not discriminate against the use of recycled materials.

Article 5 Procurement of Construction and Specified Professional Services

§ 41-2571 Definitions

In this article, unless the context otherwise requires:

"Architect services", "engineer services", "land surveying services", "geologist services" and "landscape architect services" mean those professional services within the scope of the practice of those services as provided in title 32, chapter 1, article 1.
"Cost" means the aggregate cost of all materials and services, including labor performed by force account.
"Design professional service contract" means a written agreement relating to the planning, design, construction administration, study, evaluation, consulting, inspection, surveying, mapping, material sampling, testing or other professional, scientific or technical services furnished in connection with any actual or proposed study, planning, survey, environmental remediation, construction, improvement, alteration, repair, maintenance, relocation, moving, demolition or excavation of a structure, street or roadway, appurtenance, facility or development or other improvement to land.
"Design professional services" means architect services, engineer services, land surveying services, geologist services or landscape architect services or any combination of those services performed by or under the supervision of a design professional or employees or subconsultants of the design professional.
"Subconsultant" means any person, firm, partnership, corporation, association or other organization, or a combination of any of them, that has a direct contract with a design professional or another subconsultant to perform a portion of the work under a design professional service contract.

§ 41-2572 Construction by state employees; construction by inmates of public institution

A. A building, structure, addition or alteration of a public facility may be constructed by employees or force account, if the cost does not exceed twenty thousand dollars.

B. A building, structure, addition or alteration at a public institution may be constructed by inmates if such work is determined to be advantageous to this state.

§ 41-2573 Bid security

A. As a guarantee that the contractor will enter into a contract, bid security is required for all construction procured pursuant to section 41-2533 and all construction services procured pursuant to section 41-2578, subsection F or section 41-2579, subsection F if the purchasing agency estimates that the budget for construction, excluding the cost of any finance services, maintenance services, operations services, design services, preconstruction services or other related services included in the contract, will be more than the amount established by section 41-2535, subsection D. Bid security shall be a certified check or surety bond.

B. Bid security shall be submitted in the following amounts:

For design-bid-build construction services, ten percent of the contractor's bid.
For design-build construction services awarded by competitive sealed proposals pursuant to section 41-2578, subsection F, ten percent of the purchasing agency's construction budget for the project as stated in the request for proposals, excluding finance services, maintenance services, operations services, design services, preconstruction services or any other related services included in the contract.
For job-order-contracting construction services awarded by competitive sealed proposals pursuant to section 41-2578, subsection F or section 41-2579, subsection F, the amount prescribed by the purchasing agency in the request for proposals, but not more than ten percent of the purchasing agency's reasonably estimated budget for construction that the purchasing agency believes is likely to actually be done during the first year under the contract, excluding any finance services, maintenance services, operations services, design services, preconstruction services or other related services included in the contract.

C. This section does not prevent a state governmental unit from requiring such bid security in relation to any construction contract. The surety bond shall be executed and furnished as required by title 34, chapter 2 or chapter 6, as applicable, and the conditions and provisions of the surety bond regarding the surety's obligations shall follow the form required by section 34-201 or 34-608, as applicable.

D. If the invitation for bids or request for proposals requires security, noncompliance requires that the bid be rejected unless, pursuant to rules, it is determined that the bid fails to comply in a nonsubstantial manner with the security requirements.

E. After the bids or proposals are opened, they are irrevocable for the period specified in the invitation for bids or request for proposals, except as provided in section 41-2533, subsection F, section 41-2578, subsection F and section 41-2579, subsection F. If a bidder is permitted to withdraw its bid before award, no action may be had against the bidder or the bid security.

§ 41-2574 Contract performance and payment bonds

A. The following bonds or security is required and is binding on the parties to the contract if the value of a construction award exceeds the amount established by section 41-2535:

A performance bond that is executed and furnished as required under title 34, chapter 2, article 2 or chapter 6, as applicable, in an amount equal to one hundred percent of the price specified in the contract conditioned on the faithful performance of the contract in accordance with the plans, specifications and conditions of the contract, except that:

(a) For job-order-contracting construction services, the performance bond shall cover the full amount of construction under the job-order-contracting construction services contract, shall not include any design services, preconstruction services, finance services, maintenance services, operations services or other related services included in the contract, may be a single bond for the full term of the contract, a separate bond for each year of a multiyear contract or a separate bond for each job order, as determined by the purchasing agency, and, if a single bond for the full term of the contract or a separate bond for each year of a multiyear contract, shall initially be based on the purchasing agency's reasonable estimate of the amount of construction that the purchasing agency believes is likely to actually be done during the full term of the contract or during the particular year of a multiyear contract, as applicable.

(b) For construction-manager-at-risk construction services and design-build construction services, the amount of the performance bond shall be the price of construction and shall not include the cost of any design services, preconstruction services, finance services, maintenance services, operations services and other related services included in the contract. This bond is solely for the protection of this state. The conditions and provisions of the performance bond regarding the surety's obligations shall follow the form required under section 34-222, subsection G or section 34-610, subsection G, as applicable.

A payment bond that is executed and furnished as required by title 34, chapter 2, article 2 or chapter 6, as applicable, in an amount equal to one hundred percent of the price specified in the contract for the protection of all persons supplying labor or material to the contractor or its subcontractors for the performance of the construction provided for in the contract, except that:

(a) For job-order-contracting construction services, the payment bond shall cover the full amount of construction under the job-order-contracting construction services contract, shall not include any design services, preconstruction services, finance services, maintenance services, operations services or other related services included in the contract, may be a single bond for the full term of the contract, a separate bond for each year of a multiyear contract or a separate bond for each job order, as determined by the purchasing agency, and, if a single bond for the full term of the contract or a separate bond for each year of a multiyear contract, shall initially be based on the purchasing agency's reasonable estimate of the amount of construction that the purchasing agency believes is likely to actually be done during the full term of the contract or during the particular year of a multiyear contract, as applicable.

(b) For construction-manager-at-risk construction services and design-build construction services, the amount of the payment bond shall be the price of construction and shall not include the cost of any design services, preconstruction services, finance services, maintenance services, operations services or other related services included in the contract. The conditions and provisions of the payment bond regarding the surety's obligations shall follow the form required under section 34-222, subsection F or section 34-610, subsection F, as applicable.

B. For design-bid-build construction, the bonds prescribed in subsection A of this section shall be provided on and at the same time as execution of the construction contract. For construction-manager-at-risk, design-build and job-order-contracting construction services, the bonds prescribed in subsection A of this section shall be provided only on and at the same time as execution of a contract or an amendment to a contract that commits the contractor to provide construction for a fixed price, guaranteed maximum price or other fixed amount within a designated time frame.

C. If the prime contract or specifications require any persons supplying labor or materials in the prosecution of the work to furnish payment or performance bonds, these bonds shall be executed solely by a surety company or companies holding a certificate of authority to transact surety business in this state issued by the director of the department of insurance and financial institutions pursuant to title 20, chapter 2, article 1. Notwithstanding any other statute, the bonds shall not be executed by an individual surety or sureties, even if the requirements of section 7-101 are satisfied.

§ 41-2576 Contract payment retention; partial payment

A. Ten per cent of all construction contract payments shall be retained by this state as insurance of proper performance of the contract or, at the option of the contractor, a substitute security may be provided by the contractor in an authorized form pursuant to rules adopted by the director. The contractor is entitled to all interest from any such substitute security.

B. When the contract is fifty per cent completed, one-half of the amount retained or securities substituted pursuant to this section shall be paid to the contractor upon the contractor's request provided the contractor is making satisfactory progress on the contract and there is no specific cause or claim requiring a greater amount to be retained. After the contract is fifty per cent completed, no more than five per cent of the amount of any subsequent progress payments made under the contract shall be retained providing the contractor is making satisfactory progress on the project, except that if at any time the state determines satisfactory progress is not being made ten per cent retention shall be reinstated for all progress payments made under the contract subsequent to the determination.

C. Any retention shall be paid or substitute security shall be returned to the contractor within sixty days after final completion and acceptance of work under the contract. Retention of payments by a purchasing agency longer than sixty days after final completion and acceptance requires a specific written finding by the purchasing agency of the reasons justifying the delay in payment. No purchasing agency may retain any monies after sixty days which are in excess of the amount necessary to pay the expenses the purchasing agency reasonably expects to incur in order to pay or discharge the expenses determined by the finding justifying the retention of monies.

D. This state shall not accept any substitute security unless accompanied by a signed and acknowledged waiver of any right or power of the obligor to set off any claim against either the state governmental unit or the contractor in relationship to the security assigned. In any instance in which this state accepts substitute security as provided in this section, any subcontractor undertaking to perform any part of the contract is entitled to provide such security to the contractor.

E. Notwithstanding anything to the contrary in this section or in any other law:

There shall be no retention for job-order-contracting construction services contracts and the purchasing agency may elect to have no retention for construction-manager-at-risk and design-build construction services contracts.
This section applies only to amounts payable in a construction services contract for construction and does not apply to amounts payable in a construction services contract for design services, preconstruction services, finance services, maintenance services, operations services or any other related services included in the contract.

§ 41-2577 Progress payments; changed or additional work; attorney fees; definitions

A. Progress payments may be made by this state to the contractor on the basis of a duly certified and approved estimate of the work performed during a preceding period of time as set by rule, except that a percentage of all estimates shall be retained as provided in section 41-2576. The progress payments shall be paid on or before fourteen days after the estimate of the work is certified and approved. The estimate of the work shall be deemed received by the owner on submission to any person designated by the owner for the submission, review or approval of the estimate of the work. An estimate of the work submitted under this section shall be deemed approved and certified seven days after the date of submission unless before that time the owner or owner's agent prepares and issues a specific written finding detailing those items in the estimate of the work that are not approved and certified under the contract or design professional service contract. The owner may withhold an amount from the progress payment sufficient to pay the expenses the owner reasonably expects to incur in correcting the deficiency set forth in the written finding. On completion and acceptance of separate divisions of the contract or design professional service contract on which the price is stated separately in the contract or design professional service contract, payment may be made in full including retained percentages, less deductions, unless a substitute security has been provided pursuant to section 41-2576. A contract for construction or design professional services may not materially alter the rights of any contractor, subcontractor, design professional or material supplier to receive prompt and timely payment as provided under this section.

B. The contractor shall pay to the contractor's subcontractors, design professionals or material suppliers and each subcontractor shall pay to the subcontractor's subcontractor, design professional or material supplier, within seven days after receipt of each progress payment, unless otherwise agreed in writing by the parties, the respective amounts allowed the contractor, subcontractor or design professional on account of the work performed by the contractor's or subcontractor's subcontractors or design professionals, to the extent of each such subcontractor's or design professional's interest therein, except that a contract for construction may not materially alter the rights of any contractor, subcontractor, design professional or material supplier to receive prompt and timely payment as provided under this section. These payments to subcontractors, design professionals or material suppliers shall be based on payments received pursuant to this section. Any diversion by the contractor, subcontractor or design professional of payments received for work performed on a contract, or failure to reasonably account for the application or use of such payments, constitutes grounds for disciplinary action by the registrar of contractors. The subcontractor, design professional or material supplier shall notify the registrar of contractors and the purchasing agency in writing of any payment less than the amount or percentage approved for the class or item of work or design professional services as set forth in this section.

C. A subcontractor or design professional may notify the purchasing agency in writing requesting that the subcontractor or design professional be notified by the purchasing agency in writing within five days after payment of each progress payment that is made to the contractor. The subcontractor's or design professional's request remains in effect for the duration of the subcontractor's or design professional's work on the project.

D. This chapter does not prevent the contractor or subcontractor, at the time of application and certification to the owner or contractor, from withholding such application and certification to the owner or contractor for payment to the subcontractor, design professional or material supplier for unsatisfactory job progress, defective construction work or design professional services or materials not remedied, disputed work or materials, third-party claims filed or reasonable evidence that a claim will be filed, failure of a subcontractor or design professional to make timely payments for labor, equipment and materials or design professional services, damage to the contractor or another subcontractor or design professional, reasonable evidence that the subcontract or design professional service contract cannot be completed for the unpaid balance of the subcontract or design professional service contract sum or a reasonable amount for retention that does not exceed the actual percentage retained by the owner.

E. If any payment to a contractor is delayed after the date due, interest shall be paid at the rate of one percent per month or a fraction of the month on such unpaid balance as may be due.

F. If any periodic or final payment to a subcontractor or design professional is delayed by more than seven days after receipt of periodic or final payment by the contractor or subcontractor, the contractor or subcontractor shall pay the contractor's or subcontractor's subcontractor, design professional or material supplier interest, beginning on the eighth day, at the rate of one percent per calendar month or a fraction of a calendar month on such unpaid balance as may be due.

G. Notwithstanding anything to the contrary in this section, this section applies only to amounts payable in a construction services contract for construction and in a contract for design services and does not apply to amounts payable in a contract for preconstruction services, finance services, maintenance services, operations services or any other related services included in the contract.

H. If the owner directs the contractor in writing to perform changed or additional work in accordance with the construction contract and the contractor submits to the owner a reasonable cost estimate of the changed or additional work as may be required under the construction contract, pending a final determination of the total amount to be paid for the changed or additional work, the contractor may request payment for changed or additional work that the contractor completed during the preceding calendar month in monthly pay estimates based on the costs the contractor incurred to perform that work. The person designated in the construction contract to certify and approve the monthly payment estimate shall make an interim determination for purposes of approval for payment of those costs and certify for payment the amount that person determines to be reasonably justified. Either party may disagree with the interim determination and may assert a claim in accordance with the terms of the construction contract.

I. If the owner directs the contractor in writing to perform changed or additional work in accordance with the construction contract and the contractor submits to the owner a reasonable cost estimate of the changed or additional work as may be required under the construction contract and if the contractor directs the subcontractor to perform the changed or additional work in accordance with the terms of the agreement between the contractor and subcontractor and the subcontractor submits to the contractor a reasonable cost estimate of the changed or additional work as may be required under the construction contract, pending a final determination of the total amount to be paid for the changed or additional work, the subcontractor may request payment from the contractor for the changed or additional work that the subcontractor completed during the preceding calendar month in monthly pay estimates based on the costs the subcontractor incurred to perform that work. Either party may disagree with the interim determination and may assert a claim in accordance with the terms of the agreement between the contractor and subcontractor.

J. In any action or arbitration brought pursuant to this section, the successful party shall be awarded reasonable attorney fees and costs.

K. For the purposes of this section:

Contractor does not include an agricultural improvement district formed pursuant to title 48, chapter 17, an electric cooperative formed pursuant to title 10, chapter 19, article 2 or 4 or a domestic water improvement district or a domestic wastewater improvement district formed pursuant to title 48, chapter 6, article 4.
"Costs" means the aggregate cost of all labor, materials, equipment and services.
Subcontractor does not include an agricultural improvement district formed pursuant to title 48, chapter 17, an electric cooperative formed pursuant to title 10, chapter 19, article 2 or 4 or a domestic water improvement district or a domestic wastewater improvement district formed pursuant to title 48, chapter 6, article 4.
"Work" means the labor, materials, equipment and services to be provided by a contractor or subcontractor under a construction contract.

§ 41-2578 Procurement of specified professional and construction services; definition

A. Except as authorized by sections 41-2535, 41-2536, 41-2537 and 41-2581, a single contract for architect services, assayer services, construction-manager-at-risk construction services, design-build construction services, engineer services, job-order-contracting construction services, geologist services, landscape architect services and land surveying services shall be procured as provided in this section.

B. This state shall provide notice, in accordance with rules, of each procurement of a single contract for professional services or construction services specified in this section and shall award the single contract on the basis of demonstrated competence and qualifications for the type of professional services or construction services pursuant to procedures prescribed in this section.

C. In the procurement of a single contract for professional services or construction services pursuant to this section:

The following requirements apply:

(a) The purchasing agency and the selection committee shall not request or consider fees, price, man-hours or any other cost information at any point in the selection process under this subsection or under subsection D of this section, including the selection of persons or firms to be interviewed, the selection of persons or firms to be on the final list, in determining the order of preference of persons or firms on the final list or for any other purpose in the selection process.

(b) In determining the persons or firms to participate in any interviews and in determining the persons and firms to be on the final list and their order on the final list, the selection committee shall use and shall consider only the criteria and weighting of criteria specified by the purchasing agency for that purpose as provided in this subsection. No other factors or criteria may be used in the evaluation, determinations and other actions.

(i) For construction-manager-at-risk construction services, a purchasing agency may elect separate contracts for preconstruction services during the design phase, for construction during the construction phase and for any other construction services.

(ii) For design-build construction services, a purchasing agency may elect separate contracts for preconstruction services and design services during the design phase, for construction and design services during the construction phase and for any other construction services.

(iii) For professional services, a purchasing agency may enter into multiple contracts for different phases of a single project.

(d) All construction-manager-at-risk construction services or design-build construction services included in a procurement under this section shall be limited to construction services to be performed at a single location, a common location or, if the construction services are all for a similar purpose, multiple locations. For construction-manager-at-risk construction services and design-build construction services to be performed at multiple locations:

(i) At the time the request for qualifications is issued, the purchasing agency must intend to commence all construction at each location within thirty months after execution of the first contract for preconstruction services or other construction services at any of the locations.

(ii) The request for qualifications must include the information described in paragraph 2, subdivision (g) of this subsection.

(e) If the purchasing agency enters into the first contract for preconstruction services, construction services or professional services as the result of the procurement, the procurement under this section ends. After execution of that first contract the purchasing agency may not use the procurement or the existing final list in the procurement as the basis for entering into a contract with any other person or firm that participated in the procurement.

(f) Notwithstanding any other provision of this section specifying the number of persons or firms to be interviewed, the number of persons or firms to be on a final list or any other numerical specification in this section:

(i) If a smaller number of persons or firms respond to the request for qualifications or if one or more persons or firms drop out of the procurement so that there is a smaller number of persons or firms participating in the procurement, the purchasing agency, as the purchasing agency determines necessary or appropriate, may elect to proceed with the procurement with the participating persons or firms if there are at least two participating responsive and responsible persons or firms. Alternatively, the purchasing agency may elect to terminate the procurement.

(ii) As to a request for qualifications for professional services or construction services to be negotiated pursuant to subsection E of this section only, if only one responsive and responsible person or firm responds to the request for qualifications or if one or more persons or firms drop out of the procurement so that only one responsive and responsible person or firm remains in the procurement, the director may elect to proceed with the procurement with only one person or firm if the director determines in writing that the fee negotiated pursuant to subsection E of this section is fair and reasonable and that either other prospective persons or firms had reasonable opportunity to respond or there is not adequate time for a resolicitation.

(iii) If a person or firm on the final list withdraws or is removed from the procurement and the selection committee determines that it is in the best interest of the state, the selection committee may replace that person or firm on the final list with another person or firm that submitted qualifications in the procurement and that is selected by the selection committee as the next most qualified.

The purchasing agency shall issue a request for qualifications for each procurement and give adequate public notice of the request for qualifications in the same manner as provided in section 41-2533. The request for qualifications shall:

(a) State that one contract may or will be awarded, describe the services to be performed under the contract and state that one person or firm may or will be awarded the contract.

(b) In a procurement of a contract to be negotiated under subsection E of this section, state that there will be a single final list of at least three and not more than five persons or firms. In a procurement in which the contract will be awarded under subsection F of this section, state that there will be a single final list and that the number of persons or firms on the final list will be three.

(c) As prescribed below, state the selection criteria and relative weight of the selection criteria to be used by the selection committee, except that for construction services one of the criteria shall be the person's or firm's subcontractor selection plan or procedures to implement the purchasing agency's subcontractor selection plan. All selection criteria under this subsection shall be factors that demonstrate competence and qualifications for the type of professional services or construction services included in the procurement. If:

(i) Interviews will be held, the request for qualifications shall state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms to be interviewed and the request for qualifications may state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms on the final list and in determining their order on the final list. The final list selection criteria and relative weights may be different than the selection criteria and relative weights used to determine the persons or firms to be interviewed. The request for qualifications also shall state whether the purchasing agency will select the persons or firms on the final list and their order on the final list solely through the results of the interview process or through the combined results of both the interview process and the evaluation of statements of qualifications and performance data submitted in response to the purchasing agency's request for qualifications.

(ii) Interviews will not be held, the request for qualifications shall state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms on the final list and in determining their order on the final list.

(d) If the purchasing agency will hold interviews as part of the selection process, state that interviews will be held and that the interviews will be with at least three and no more than five persons or firms.

(e) For procurements of construction services, include either:

(i) A requirement that each person or firm submit a proposed subcontractor selection plan and a requirement that the proposed subcontractor selection plan must select subcontractors based on qualifications alone or on a combination of qualifications and price and shall not select subcontractors based on price alone.

(ii) A subcontractor selection plan adopted by the purchasing agency that applies to the person or firm that is selected to perform the construction services and that requires subcontractors to be selected based on qualifications alone or on a combination of qualifications and price and not based on price alone and a requirement that each person or firm must submit a description of the procedures it proposes to use to implement the purchasing agency's subcontractor selection plan.

(f) Include a description of the publicly available location of the purchasing agency's protest policy and procedures or, if the purchasing agency does not have a protest policy and procedures, a statement that the protest policy and procedures referred to in subsection J of this section apply to any protests in connection with the procurement.

(g) In a procurement of construction-manager-at-risk construction services or design-build construction services to be performed at multiple locations, include:

(i) A brief description of the construction services to be performed at each location.

(ii) The estimated budget for the construction services to be performed at each location.

(iii) A schedule for the construction services to be performed at each location that shows the purchasing agency's intent to commence all construction at each location within thirty months after execution of the first contract for preconstruction services or other construction services at any of the locations.

The director or head of a purchasing agency shall initiate an appropriately qualified selection committee for each request for qualifications in accordance with rules adopted by the director. The director or head of a purchasing agency shall ensure that the selection committee members are competent to serve on the selection committee. Each selection committee must include one employee of the purchasing agency or a purchasing agency representative appointed by the purchasing agency. If procuring professional services, the purchasing agency shall determine the number and qualifications of the selection committee members. A selection committee for the procurement of construction services shall not have more than seven members and shall include at least one person who is a senior management employee of a licensed contractor and one person who is an architect or an engineer who is registered pursuant to section 32-121. These members may be employees of the purchasing agency or outside consultants. Outside contractors, architects and engineers serving on a selection committee shall not receive compensation from the purchasing agency for performing this service, but the purchasing agency may elect to reimburse outside contractors, architects and engineers for travel, lodging and other expenses incurred in connection with service on a selection committee. A person who is a member of a selection committee shall not be a contractor under a contract awarded under the procurement or provide any professional services, construction, construction services, materials or other services under the contract. The selection committee and the purchasing agency shall do the following:

(a) If interviews are specified in the request for qualifications:

(i) The selection committee shall determine the person or firms to be interviewed by evaluating the statements of qualifications and performance data that are submitted in response to the purchasing agency's request for qualifications based only on the selection criteria and relative weight of the selection criteria stated in the request for qualifications to be used to determine the persons or firms to be interviewed.

(ii) If the selection criteria and relative weight of the selection criteria to be used by the selection committee to select the persons or firms on the final list and to determine their order on the final list are not included in the request for qualifications, before the interviews are held the purchasing agency shall distribute to the persons or firms to be interviewed the selection criteria and relative weight of the selection criteria to be used to select the persons or firms on the final list and to determine their order on the final list. These selection criteria and relative weight may be different than the selection criteria and relative weight used to determine the persons or firms to be interviewed.

(iii) The selection committee shall conduct interviews with at least three but not more than five persons or firms as specified in the request for qualifications regarding the professional services or construction services and the relative methods of approach for furnishing the required professional services or construction services.

(b) Based only on the selection criteria and relative weight of the selection criteria specified as provided in this subsection for selection of the persons or firms on the final list and their order on the final list, the selection committee shall select the persons or firms for the final list and, in the case of a final list for a contract that will be negotiated under subsection E of this section, rank the three persons or firms on the final list in order of preference.

(c) If the contract will be negotiated under subsection E of this section, before or at the same time as the purchasing agency notifies the highest ranking person or firm on the final list that it is the highest ranking person or firm, the purchasing agency shall send actual notice to each of the following that it is not the highest person or firm on the final list or that another person or firm is the highest ranking person or firm on the final list:

(i) If interviews were held, the other persons and firms interviewed.

(ii) If interviews were not held, the other persons and firms that made submittals.

(d) If the contract will be awarded under subsection F of this section, before or at the same time as the purchasing agency notifies the persons or firms on the final list that they are on the final list, the purchasing agency shall send actual notice to each of the following persons or firms that they are not on the final list or that other persons or firms are on the final list:

(i) If interviews were held, the other persons or firms interviewed.

(ii) If interviews were not held, the other persons or firms that made submittals.

D. The director shall award the single contract under the procurement as provided in subsection E or F of this section.

E. The procurement officer shall conduct negotiations with persons or firms on the final list as follows:

The procurement is for a single contract for construction services or professional services, and there is one final list.
The negotiations shall include consideration of compensation and other contract terms that the procurement officer determines to be fair and reasonable to the procurement officer. In making this decision, the procurement officer shall take into account the estimated value, the scope, the complexity and the nature of the professional services or construction services to be rendered.
The procurement officer shall enter into negotiations with the highest qualified person or firm on the final list.
If the procurement officer is not able to negotiate a satisfactory contract with the highest qualified person or firm on the final list, at compensation and on other contract terms the procurement officer determines to be fair and reasonable to this state, the procurement officer shall formally terminate negotiations with that person or firm. The procurement officer shall then undertake negotiations with the next most qualified person or firm on the final list in sequence until an agreement is reached or a determination is made to reject all persons or firms on the final list.
If, in a procurement under this section, the procurement officer terminates negotiations with a person or firm on the final list and commences negotiations with another person or firm on the final list, the procurement officer shall not in that procurement recommence negotiations or enter into a contract for the construction services or professional services covered by the final list with any person or firm on the final list with whom the procurement officer has terminated negotiations.

F. As an alternative to subsection E of this section, the procurement officer may award a single contract for design-build construction services or job-order-contracting construction services as follows:

The procurement officer shall use the selection committee appointed for the request for qualifications pursuant to subsection C of this section.
The procurement officer shall issue a request for proposals to the persons or firms on the final list developed pursuant to subsection C of this section.
The request for proposals shall include:

(a) The purchasing agency's project schedule and project final budget for design and construction or life cycle budget for a procurement that includes maintenance services or operations services.

(b) A statement that the contract will be awarded to the person or firm whose proposal receives the highest number of points under a scoring method.

(c) A description of the scoring method, including a list of the factors in the scoring method and the number of points allocated to each factor. The factors in the scoring method may include:

(i) For design-build construction services only, demonstrated compliance with the design requirements.

(ii) Offeror qualifications.

(iii) Offeror financial capacity.

(iv) Compliance with the purchasing agency's project schedule.

(v) For design-build construction services only, if the request for proposals specifies that the purchasing agency will spend its project budget and not more than its project budget and is seeking the best proposal for the project budget, compliance of the offeror's price or life cycle price for procurements that include maintenance services, operations services or finance services with the purchasing agency's budget as prescribed in the request for proposals.

(vi) For design-build construction services if the request for proposals does not contain the specifications prescribed in item (v) and for job-order-contracting construction services, the price or life cycle price for procurements that include maintenance services, operations services or finance services.

(vii) An offeror quality management plan.

(viii) Other evaluation factors that demonstrate competence and qualifications for the type of construction services in the request for proposals as determined by the purchasing agency, if any.

(d) For design-build construction services only, the design requirements.

(e) A requirement that each offeror submit separately a technical proposal and a price proposal and that the offeror's entire proposal be responsive to the requirements in the request for proposals. For design-build construction services, the price in the price proposal shall be a fixed price or a guaranteed maximum price.

(f) A statement that in applying the scoring method the selection committee will separately evaluate the technical proposal and the price proposal and will evaluate and score the technical proposal before opening the price proposal.

(g) If the purchasing agency conducts discussions pursuant to paragraph 5 of this subsection, a statement that discussions will be held and a requirement that each offeror submit a preliminary technical proposal before the discussions are held.

If the purchasing agency determines to conduct discussions pursuant to paragraph 5 of this subsection, each offeror shall submit a preliminary technical proposal to the purchasing agency before those discussions are held.
If determined by the purchasing agency and included by the purchasing agency in the request for proposals, the selection committee shall conduct discussions with all offerors that submit preliminary technical proposals. Discussions shall be for the purpose of clarification to ensure full understanding of, and responsiveness to, the solicitation requirements. Offerors shall be accorded fair treatment with respect to any opportunity for discussion and for clarification by the owner. Revision of preliminary technical proposals shall be permitted after submission of preliminary technical proposals and before award for the purpose of obtaining best and final proposals. In conducting any discussions, information derived from proposals submitted by competing offerors shall not be disclosed to other competing offerors.
After completion of any discussions pursuant to paragraph 5 of this subsection or if no discussions are held, each offeror shall submit separately its final technical proposal and its price proposal.
Before opening any price proposal, the selection committee shall open the final technical proposals, evaluate the final technical proposals and score the final technical proposals using the scoring method in the request for proposals. No other factors or criteria may be used in the evaluation and scoring.
After completion of the evaluation and scoring of all final technical proposals, the selection committee shall open the price proposals, evaluate the price proposals, score the price proposals and complete the scoring of the entire proposals using the scoring method in the request for proposals. No other factors or criteria may be used in the evaluation and scoring.
The procurement officer shall award the contract or contracts to the responsive and responsible offeror whose proposal receives the highest score under the method of scoring in the request for proposals. No other factors or criteria may be used in the evaluation. Before or at the same time as the purchasing agency notifies the winning offeror that it has won, the purchasing agency shall send actual notice to each other offeror either that the offeror has not won or that another offeror has won.
The contract or contracts file shall contain the basis on which the award is made, including at a minimum the information and documents required under subsection G of this section.
For design-build construction services only, the procurement officer shall award a stipulated fee equal to a percentage, as prescribed in the request for proposals, of the purchasing agency's project final budget for design and construction, as prescribed in the request for proposals, but not less than two-tenths of one per cent of the project final budget for design and construction to each final list offeror who provides a responsive, but unsuccessful, proposal. If the procurement officer does not award a contract, all responsive final list offerors shall receive the stipulated fee based on the purchasing agency's project final budget for design and construction as included in the request for proposals. The procurement officer shall pay the stipulated fee to each offeror within ninety days after the award of the initial contract or the decision not to award a contract. In consideration for paying the stipulated fee, the procurement officer may use any ideas or information contained in the proposals in connection with any contract awarded for the project, or in connection with a subsequent procurement, without any obligation to pay any additional compensation to the offerors. Notwithstanding the other provisions of this paragraph, an offeror may elect to waive the stipulated fee. If an offeror elects to waive the stipulated fee, the purchasing agency may not use ideas and information contained in the offeror's proposal, except that this restriction does not prevent the purchasing agency from using any idea or information if the idea or information is also included in a proposal of an offeror that accepts the stipulated fee.

G. At a minimum, the purchasing agency shall retain the following for each procurement under this section:

For each request for qualifications procurement process under subsection C of this section:

(a) If interviews were not held:

(i) The submittal of the person or firm listed first on the final list and, if different, the submittal of the person or firm with which the purchasing agency enters into a contract.

(ii) The final list.

(iii) A list of the selection criteria and relative weight of selection criteria used to select the persons or firms for the final list and to determine their order on the final list.

(iv) A list that contains the name of each person or firm that submitted qualifications and that shows the person's or firm's final overall rank or score.

(v) A document or documents that show the final score or rank on each selection criteria of each person or firm that submitted qualifications and that support the final overall rankings and scores of the persons or firms that submitted qualifications. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for individual selection committee members or any other form as determined by the purchasing agency.

(b) If interviews were held:

(i) All submittals of the person or firm listed first on the final list and, if different, all submittals of the person or firm with which the purchasing agency enters into a contract.

(ii) The final list.

(iii) A list of the selection criteria and relative weight of selection criteria used to select the persons or firms for the final list and to determine their order on the final list.

(iv) A list that contains the name of each person or firm that was interviewed and that shows the person's or firm's final overall rank or score.

(v) A document or documents that show the final score or rank on each selection criteria of each person or firm that was interviewed and that support the final overall rankings and scores of the persons or firms that were interviewed. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for individual selection committee members or any other form as determined by the purchasing agency.

(vi) A list of the selection criteria and relative weight of the selection criteria used to select the persons or firms for the short list to be interviewed.

(vii) A list that contains the name of each person or firm that submitted qualifications and that shows the person's or firm's final overall rank or score in the selection of the persons or firms to be on the short list to be interviewed.

(viii) A document or documents that show the final score or rank on each selection criteria of each person or firm that submitted qualifications and that support the final overall rankings and scores of the persons or firms that submitted qualifications in the selection of the persons or firms to be on the short list to be interviewed. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for the individual selection committee members or any other form as determined by the purchasing agency.

For each request for proposals procurement process under subsection F of this section:

(a) The entire proposal submitted by the person or firm that received the highest score in the scoring method in the request for proposals and, if different, the entire proposal submitted by the person or firm with which the purchasing agency enters into a contract.

(b) The description of the scoring method, the list of factors in the scoring method and the number of points allocated to each factor, all as included in the request for proposals.

(c) A list that contains the name of each offeror that submitted a proposal and that shows the offeror's final overall score.

(d) A document or documents that show the final score on each factor in the scoring method in the request for proposals of each offeror that submitted a proposal and that support the final overall scores of the offerors that submitted proposals. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for individual selection committee members or any other form as determined by the purchasing agency.

H. Information relating to each procurement under this section shall be made available to the public as follows:

Notwithstanding title 39, chapter 1, article 2, until the purchasing agency awards a contract or terminates the procurement, only the name of each person or firm on the final list developed pursuant to subsection C of this section may be made available to the public. All other information received by the purchasing agency in response to the request for qualifications pursuant to subsection C of this section or contained in proposals submitted pursuant to subsection F of this section shall be confidential in order to avoid disclosure of the contents that may be prejudicial to competing submitters and offerors during the selection process.
After the purchasing agency awards the contract or terminates the procurement, the purchasing agency shall make available to the public pursuant to title 39, chapter 1, article 2 at a minimum all of the items that the purchasing agency is required to retain under subsection G of this section, except the proposals submitted in response to a request for proposals under subsection F of this section and the document or documents prescribed in subsection G, paragraph 1, subdivision (a), item (v) and subdivision (b), items (v) and (viii) and paragraph 2, subdivision (d) of this section.
The proposals submitted under subsection F of this section shall not be made available to the public until after the purchasing agency has entered into a contract or terminated the procurement. At a minimum the proposals submitted under subsection F of this section that the purchasing agency is required to retain under subsection G of this section shall be made available to the public after the purchasing agency has entered into a contract or terminated the procurement.
To the extent that the offeror designates and the purchasing agency concurs, trade secrets and other proprietary data contained in a proposal remain confidential.
The document or documents prescribed in subsection G, paragraph 1, subdivision (a), item (v) and subdivision (b), items (v) and (viii) and paragraph 2, subdivision (d) of this section are available to the extent provided in title 39, chapter 1, article 2.

I. A purchasing agency may cancel a request for qualifications or a request for proposals, reject in whole or in part any or all submissions of qualifications or proposals or determine not to enter into a contract as specified in the solicitation if it is in the best interest of the purchasing agency. The purchasing agency shall make the reasons for cancellation, rejection or determination not to enter into a contract part of the contract file.

J. If the purchasing agency does not have a procurement protest policy and procedures that have been formally adopted and published by the purchasing agency, for protests relating to procurements under this section the purchasing agency shall follow the procurement protest policy and procedures of the department. The purchasing agency shall process all protests relating to procurements under this section.

K. For the purposes of this section, "professional services" includes architect services, engineer services, landscape architect services, assayer services, geologist services and land surveying services and any combination of those services.

§ 41-2579 Procurement of multiple contacts for certain job-order-contracting construction services and certain professional services; definition

A. Except as authorized in this section and in sections 41-2535, 41-2536, 41-2537 and 41-2581, a purchasing agency shall not procure in a single procurement multiple contracts for construction services or professional services. In a procurement under this section, there is a single procurement process for all of the multiple contracts included in the procurement. A purchasing agency may procure under this section:

Multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms.
Multiple contracts for professional services to be awarded to separate persons or firms or to be awarded to a single person or firm as specified in the request for qualifications.

B. A purchasing agency shall provide notice of each procurement under this section and shall award contracts on the basis of demonstrated competence and qualifications for the type of professional services or construction services pursuant to the procedures prescribed in this section.

C. In a procurement pursuant to this section:

The following requirements apply:

(a) The purchasing agency and the selection committee shall not request or consider fees, price, man-hours or any other cost information at any point in the selection process under this subsection or under subsection D of this section, including the selection of persons or firms to be interviewed, the selection of persons or firms to be on a final list, in determining the order of preference of persons or firms on a final list or for any other purpose in the selection process.

(b) In determining the persons or firms to participate in any interviews and in determining the persons and firms to be on a final list and their order on a final list, the selection committee shall use and shall consider only the criteria and weighting of criteria specified by the purchasing agency for that purpose as provided in this subsection. No other factors or criteria may be used in the evaluation, determinations and other actions.

(c) If the purchasing agency enters into the number of multiple contracts being procured for job-order-contracting construction services or professional services, a procurement under this section ends. After that time the purchasing agency may not use the procurement or any existing final list in the procurement as the basis for entering into a replacement contract with any other person or firm that participated in the procurement.

(d) Notwithstanding any other provision of this section specifying the number of persons or firms to be interviewed, the number of persons or firms to be on a final list or any other numerical specification in this section:

(ii) As to a request for qualifications for professional services or job-order-contracting construction services to be negotiated pursuant to subsection E of this section only, if only one responsive and responsible person or firm responds to the request for qualifications or if one or more persons or firms drop out of the procurement so that only one responsive and responsible person or firm remains in the procurement, the director may elect to proceed with the procurement with only one person or firm if the director determines in writing that the fee negotiated pursuant to subsection E of this section is fair and reasonable and that either other prospective persons or firms had reasonable opportunity to respond or there is not adequate time for a resolicitation.

(iii) If a person or firm on a final list withdraws or is removed from the procurement and the selection committee determines that it is in the best interest of this state, the selection committee may replace that person or firm on the final list with another person or firm that submitted qualifications in the procurement and that is selected by the selection committee as the next most qualified.

The purchasing agency shall issue a request for qualifications for each procurement and give adequate public notice of the request for qualifications in the same manner as provided in section 41-2533. The publication shall include the fact that multiple contracts may or will be awarded, shall state the number of contracts that may or will be awarded and shall describe the professional services or job-order-contracting construction services to be performed under each contract. The request for qualifications shall:

(a) State the following information about the contracts that may or will be awarded:

(i) If the request for qualifications is for multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms, that multiple contracts for similar job-order-contracting construction services may or will be awarded, the number of contracts that may or will be awarded, the services to be performed under each of the multiple contracts and that each of the multiple contracts will be awarded to a separate person or firm.

(ii) If the request for qualifications is for multiple contracts for professional services, that multiple contracts for professional services may or will be awarded, the number of contracts that may or will be awarded, the services to be performed under each of the multiple contracts and either that each of the multiple contracts will be awarded to a separate person or firm or that all of the multiple contracts will be awarded to the same person or firm.

(b) State as to final lists:

(i) In a procurement of multiple contracts for professional services to be awarded to a single person or firm, that there will be a single final list of not more than ten persons or firms.

(ii) In a procurement for multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms or in a procurement for multiple contracts for similar professional services to be awarded to separate persons or firms, that there will be a single final list and the number of persons or firms on the final list, which shall be the sum of the number of contracts that may or will be awarded and a number that is determined by the purchasing agency and that is not more than ten.

(iii) In a procurement for multiple contracts for different professional services to be awarded to separate persons or firms, that there will be a separate final list for each type of professional services and that the number of persons or firms on each final list will be the number of contracts that may or will be awarded for each type of professional services and a number that is determined by the purchasing agency and that is not more than ten.

(c) As prescribed below, state the selection criteria and relative weight of the selection criteria to be used by the selection committee, except that in a procurement for multiple contracts for job-order-contracting construction services to be awarded to separate persons or firms one of the criteria shall be the person's or firm's subcontractor selection plan or procedures to implement the purchasing agency's subcontractor selection plan. All selection criteria under this subsection shall be factors that demonstrate competence and qualifications for the type of professional services or job-order-contracting construction services included in the procurement. If:

(i) Interviews will be held, the request for qualifications shall state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms to be interviewed and the request for qualifications may state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms on each final list and in determining their order on each final list. The final list selection criteria and relative weights may be different than the selection criteria and relative weights used to determine the persons or firms to be interviewed. The request for qualifications also shall state whether the purchasing agency will select the persons or firms on the final list and their order on the final list solely through the results of the interview process or through the combined results of both the interview process and the evaluation of statements of qualifications and performance data submitted in response to the purchasing agency's request for qualifications.

(ii) Interviews will not be held, the request for qualifications shall state the selection criteria and relative weight of the selection criteria to be used in selecting the persons or firms on each final list and in determining their order on each final list.

(d) If the purchasing agency will hold interviews as part of the selection process:

(i) In a procurement of multiple contracts for professional services to be awarded to the same person or firm, state that interviews will be held and that the interviews will be with not more than ten persons or firms.

(ii) In a procurement of multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms or in a procurement of multiple contracts for similar professional services to be awarded to separate persons or firms, state that interviews will be held and that the interviews will be with a specified number of persons or firms. The specified number shall be stated in the request for qualifications, shall be determined by the purchasing agency and shall be not more than ten persons or firms.

(iii) In a procurement of multiple contracts for different professional services to be awarded to separate persons or firms, state that interviews will be held and that the interviews will be with a specified number of persons or firms. The specified number shall be stated in the request for qualifications, shall be determined by the purchasing agency and shall be not more than ten persons or firms.

(e) For procurements of multiple contracts for job-order-contracting construction services to be awarded to separate persons or firms, include either:

(ii) A subcontractor selection plan adopted by the purchasing agency that applies to the person or firm that is selected to perform the job-order-contracting construction services and that requires subcontractors to be selected based on qualifications alone or on a combination of qualifications and price and not based on price alone and a requirement that each person or firm must submit a description of the procedures it proposes to use to implement the purchasing agency's subcontractor selection plan.

The director or head of the purchasing agency shall initiate an appropriately qualified selection committee for each request for qualifications. The director or head of the purchasing agency shall ensure that the selection committee members are competent to serve on the selection committee. Each selection committee must include one employee of the purchasing agency or a purchasing agency representative appointed by the purchasing agency. The same selection committee shall function as to all of the multiple contracts included in the procurement. If the purchasing agency is procuring multiple contracts for professional services, the purchasing agency shall determine the number and qualifications of the selection committee members. A selection committee for the procurement of multiple contracts for job-order-contracting construction services shall have not more than seven members and shall include at least one person who is a senior management employee of a licensed contractor and one person who is an architect or engineer registered pursuant to section 32-121. These members may be employees of the purchasing agency or outside consultants. Outside contractors, architects and engineers serving on a selection committee are not entitled to receive compensation from the purchasing agency for performing this service, but the purchasing agency may elect to reimburse outside contractors, architects and engineers for travel, lodging and other expenses incurred in connection with service on a selection committee. A person who is a member of a selection committee shall not be a contractor under a contract awarded under the procurement or provide any professional services, construction, construction services, materials or other services under the contract. The selection committee and the purchasing agency shall do the following:

(a) If interviews are specified in the request for qualifications:

(i) The selection committee shall determine the persons or firms to be interviewed by evaluating the statements of qualifications and performance data that are submitted in response to the purchasing agency's request for qualifications based only on the selection criteria and relative weight of the selection criteria stated in the request for qualifications to be used to determine the persons or firms to be interviewed.

(ii) If the selection criteria and relative weight of the selection criteria to be used by the selection committee to select the persons or firms on a final list and to determine their order on a final list are not included in the request for qualifications, before the interviews are held the purchasing agency shall distribute to the persons or firms to be interviewed the selection criteria and relative weight of the selection criteria to be used to select the persons or firms on each final list and to determine their order on each final list. These selection criteria and relative weight may be different than the selection criteria and relative weight used to determine the persons or firms to be interviewed.

(iii) The selection committee shall conduct interviews with the number of persons or firms to be interviewed as stated in the request for qualifications regarding the professional services or job-order-contracting construction services and the relative methods of approach for furnishing the required professional services or job-order-contracting construction services.

(b) Based only on the selection criteria and relative weight of the selection criteria specified as provided in this subsection for selection of the persons or firms on each final list and their order on each final list, the selection committee shall select the persons or firms for each final list and in the case of a final list or final lists for multiple contracts that will be negotiated under subsection E of this section, rank the persons or firms on each final list in order of preference. If the procurement is for multiple contracts for different professional services to be awarded to separate persons or firms, there is a separate final list for each type of professional services, and if a person or firm submitted qualifications for more than one type of professional services, the person or firm may be on more than one final list.

(c) If the contract will be awarded under subsection E of this section, before or at the same time as the purchasing agency notifies the persons or firms on each final list that they are on that final list, the purchasing agency shall send actual notice to the following persons or firms that they are not on that final list:

(i) If interviews were held, the other persons and firms interviewed for that final list.

(ii) If interviews were not held, the other persons and firms that made submittals for that final list.

(i) If interviews were held, the other persons or firms interviewed.

(ii) If interviews were not held, the other persons or firms that made submittals.

D. The purchasing agency shall award multiple contracts specified in the request for qualifications as provided in subsection E or F of this section.

E. The procurement officer shall conduct negotiations with persons or firms on the final list or final lists. The negotiations shall include consideration of compensation and other contract terms that the procurement officer determines to be fair and reasonable to this state. In making this decision, the procurement officer shall take into account the estimated value, the scope, the complexity and the nature of the professional services or job-order-contracting construction services to be rendered. If in a procurement under this section the procurement officer terminates negotiations with a person or firm on a final list and commences negotiations with another person or firm on that final list, the procurement officer shall not in that procurement recommence negotiations or enter into a contract for the job-order-contracting construction services or professional services covered by that final list with any person or firm on that final list with whom the procurement officer has terminated negotiations. If the procurement is for:

Multiple contracts for professional services to be awarded to a single person or firm, there is one final list and the procurement officer shall enter into negotiations with the highest qualified person or firm on the final list. If the procurement officer is not able to negotiate a satisfactory contract with the highest qualified person or firm on the final list, at compensation and on other contract terms the procurement officer determines to be fair and reasonable, the procurement officer shall then undertake negotiations with the next most qualified person or firm on the final list in sequence until an agreement is reached or a determination is made to reject all persons or firms on the final list.
Multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms or for multiple contracts for similar professional services to be awarded to separate persons or firms, there is one final list and the procurement officer shall enter into separate negotiations for contracts with the number of the highest qualified persons or firms on the final list equal to the number of contracts to be awarded. If the procurement officer is not able to negotiate a satisfactory contract with a person or firm with whom the procurement officer has commenced negotiations, the procurement officer shall formally terminate negotiations with that person or firm. The procurement officer shall then undertake negotiations for a contract with the next most qualified person or firm on the final list with whom the procurement officer is not then negotiating and with whom the procurement officer has not previously negotiated in sequence until an agreement is reached for some or all of the multiple contracts included in the request for qualifications or a determination is made to reject all persons or firms on the final list.
Multiple contracts for different professional services to be awarded to separate persons or firms, there is a separate final list for each type of professional services and the procurement officer shall enter into separate negotiations for contracts with the number of the highest qualified persons or firms on the final list equal to the number of contracts to be awarded. If the procurement officer is not able to negotiate a satisfactory contract with a person or firm with whom the procurement officer has commenced negotiations, the procurement officer shall formally terminate negotiations with that person or firm. The procurement officer shall then undertake negotiations for a contract with the next most qualified person or firm on the final list with whom the procurement officer is not then negotiating and with whom the procurement officer has not previously negotiated in sequence until an agreement is reached for some or all of the multiple contracts included in the request for qualifications or a determination is made to reject all persons or firms on the final list.

F. As an alternative to subsection E of this section, the purchasing agency may award multiple contracts for similar job-order-contracting construction services to be awarded to separate persons or firms as follows:

The purchasing agency shall use the selection committee appointed for the request for qualifications pursuant to subsection C of this section.
The purchasing agency shall issue a request for proposals to the persons or firms on the final list developed pursuant to subsection C of this section.
The request for proposals shall include:

(a) The purchasing agency's project schedule and project final budget for design and construction or life cycle budget for a procurement that includes maintenance services or operations services.

(b) A statement that the multiple contracts will be awarded to a specified number of offerors whose proposals receive the highest number of points under a scoring method. The specified number of offerors will be the number of contracts included in the procurement.

(c) A description of the scoring method, including a list of the factors in the scoring method and the number of points allocated to each factor. The factors in the scoring method may include:

(i) Offeror qualifications.

(ii) Offeror financial capacity.

(iii) Compliance with the purchasing agency's project schedule.

(iv) The price or life cycle price for procurements that include maintenance services, operations services or finance services.

(v) An offeror quality management plan.

(vi) Other evaluation factors that demonstrate competence and qualifications for the job-order-contracting construction services in the request for proposals as determined by the purchasing agency, if any.

(d) A requirement that each offeror submit separately a technical proposal and a price proposal and that the offeror's entire proposal be responsive to the requirements in the request for proposals.

(e) A statement that in applying the scoring method the selection committee will separately evaluate the technical proposal and the price proposal and will evaluate and score the technical proposal before opening the price proposal.

(f) If the purchasing agency conducts discussions pursuant to paragraph 5 of this subsection, a statement that discussions will be held and a requirement that each offeror submit a preliminary technical proposal before the discussions are held.

If the purchasing agency determines to conduct discussions pursuant to paragraph 5 of this subsection, each offeror shall submit a preliminary technical proposal to the purchasing agency before those discussions are held.
If determined by the purchasing agency and included by the purchasing agency in the request for proposals, the selection committee shall conduct discussions with all offerors that submit preliminary technical proposals. Discussions shall be for the purpose of clarification to ensure full understanding of, and responsiveness to, the solicitation requirements. Offerors shall be accorded fair treatment with respect to any opportunity for discussion and for clarification by the purchasing agency. Revision of preliminary technical proposals shall be allowed after submission of preliminary technical proposals and before award for the purpose of obtaining best and final proposals. In conducting any discussions, information derived from proposals submitted by competing offerors shall not be disclosed to other competing offerors.
After completion of any discussions pursuant to paragraph 5 of this subsection or if no discussions are held, each offeror shall separately submit the offeror's final technical proposal and its price proposal.
Before opening any price proposal, the selection committee shall open the final technical proposals, evaluate the final technical proposals and score the final technical proposals using the scoring method in the request for proposals. No other factors or criteria may be used in the evaluation and scoring.
After completion of the evaluation and scoring of all final technical proposals, the selection committee shall open the price proposals, evaluate the price proposals, score the price proposals and complete the scoring of the entire proposals using the scoring method in the request for proposals. No other factors or criteria may be used in the evaluation and scoring.
The purchasing agency shall award the multiple contracts to the responsive and responsible offerors whose proposals receive the highest scores under the method of scoring in the request for proposals. No other factors or criteria may be used in the evaluation. Before or at the same time as the purchasing agency notifies the winning offerors that they have won, the purchasing agency shall give actual notice to each other offeror either that the offeror has not won or that other offerors have won.
The contracts file shall contain the basis on which the award is made, including at a minimum the information and documents required under subsection G of this section.

G. If the procurement has multiple final lists under subsection C of this section or multiple requests for proposals under subsection F of this section, the purchasing agency shall retain the items in paragraphs 1 and 2 of this subsection, as applicable, for each final list and each request for proposals procurement process. At a minimum, the purchasing agency shall retain the following for each procurement under this section:

As to each final list under each request for qualifications procurement process under subsection C of this section:

(a) If interviews were not held:

(i) The submittal of the person or firm listed first on the final list and all submittals of each person or firm with which the purchasing agency enters into a contract.

(ii) The final list.

(iii) A list of the selection criteria and relative weight of selection criteria used to select the persons or firms for the final list and to determine their order on the final list.

(iv) A list that contains the name of each person or firm that submitted qualifications and that shows the person's or firm's final overall rank or score.

(v) A document or documents that show the final score or rank on each selection criterion of each person or firm that submitted qualifications and that support the final overall rankings and scores of the persons or firms that submitted qualifications. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for individual selection committee members or any other form as determined by the purchasing agency.

(b) If interviews were held:

(i) All submittals of the person or firm listed first on the final list and all submittals of each person or firm with which the purchasing agency enters into a contract.

(ii) The final list.

(iii) A list of the selection criteria and relative weight of selection criteria used to select the persons or firms for the final list and to determine their order on the final list.

(iv) A list that contains the name of each person or firm that was interviewed and that shows the person's or firm's final overall rank or score.

(v) A document or documents that show the final score or rank on each selection criterion of each person or firm that was interviewed and that support the final overall rankings and scores of the persons or firms that were interviewed. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for individual selection committee members or any other form as determined by the purchasing agency.

(vi) A list of the selection criteria and relative weight of the selection criteria used to select the persons or firms for the short list to be interviewed.

(viii) A document or documents that show the final score or rank on each selection criterion of each person or firm that submitted qualifications and that support the final overall rankings and scores of the persons or firms that submitted qualifications in the selection of the persons or firms to be on the short list to be interviewed. At the election of the purchasing agency, this documentation may be in the form of a consolidated scoring sheet for the entire selection committee, in the form of individual scoring sheets for the individual selection committee members or any other form as determined by the purchasing agency.

For each request for proposals procurement process under subsection F of this section:

(a) The entire proposal submitted by the person or firm that received the highest score in the scoring method in the request for proposals and the entire proposal submitted by each person or firm with which the purchasing agency enters into a contract.

(b) The description of the scoring method, the list of factors in the scoring method and the number of points allocated to each factor, all as included in the request for proposals.

(c) A list that contains the name of each offeror that submitted a proposal and that shows the offeror's final overall score.

H. Information relating to each procurement under this section shall be made available to the public as follows:

Notwithstanding title 39, chapter 1, article 2, until contract award by a purchasing agency of all of the multiple contracts in the procurement or termination of the procurement by the purchasing agency, only the name of each person or firm on the final list developed pursuant to subsection C of this section may be made available to the public and all other information received by the purchasing agency in response to the request for qualifications under subsection C of this section or contained in proposals submitted under subsection F of this section shall be confidential in order to avoid disclosure of the contents that may be prejudicial to competing submitters and offerors during the selection process.
After the purchasing agency awards all of the multiple contracts in the procurement or terminates the procurement, the purchasing agency shall make available to the public pursuant to title 39, chapter 1, article 2 at a minimum all of the items that the purchasing agency is required to retain under subsection G of this section, except the proposals submitted in response to a request for proposals under subsection F of this section and the document or documents prescribed in subsection G, paragraph 1, subdivision (a), item (v), and subdivision (b), items (v) and (viii) and paragraph 2, subdivision (d) of this section.
The proposals submitted under subsection F of this section shall not be made available to the public until after the purchasing agency has entered into a contract for all of the multiple contracts in the procurement or the purchasing agency has terminated the procurement. At a minimum the proposals submitted under subsection F of this section that the purchasing agency is required to retain under subsection G of this section shall be made available to the public after the purchasing agency has entered into a contract for all of the contracts in the procurement or the purchasing agency has terminated the procurement.
To the extent that the offeror designates and the purchasing agency concurs, trade secrets and other proprietary data contained in a proposal remain confidential.
The document or documents prescribed in subsection G, paragraph 1, subdivision (a), item (v) and subdivision (b), items (v) and (viii) and paragraph 2, subdivision (d) of this section are available to the extent provided in title 39, chapter 1, article 2.

I. The purchasing agency may cancel a request for qualifications or a request for proposals, reject in whole or in part any or all submittals or proposals or determine not to enter into one or more of the multiple contracts as specified in the solicitation if the purchasing agency determines in its absolute and sole discretion that the action is in the best interest of this state. The purchasing agency shall make the reasons for cancellation, rejection or determination not to enter into contracts part of the contract file.

§ 41-2580 Requirements applicable to construction services and professional services and to contracts for construction services and professional services; definition

A. The requirements prescribed in this section apply to each contract entered into as the result of a procurement of construction services or professional services under section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581 and to the professional services and construction services included in each procurement under section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581.

B. If a procurement under section 41-2578 is for construction-manager-at-risk construction services or design-build construction services to be contracted pursuant to section 41-2578, subsection E or if a procurement under section 41-2535, 41-2536 or 41-2537 is for construction-manager-at-risk construction services or design-build construction services, the purchasing agency shall enter into a written contract with the contractor for preconstruction services under which the purchasing agency shall pay the contractor a fee for preconstruction services in an amount agreed by the purchasing agency and the contractor, and the purchasing agency shall not request or obtain a fixed price or a guaranteed maximum price for the construction from the contractor or enter into a construction contract with the contractor until after the purchasing agency has entered into the written contract for preconstruction services and a preconstruction services fee.

C. If a contract for construction services is entered into as the result of a procurement under section 41-2535, 41-2536, 41-2537, 41-2578 or 41-2579, construction shall not commence until the purchasing agency and contractor agree in writing on either a fixed price that the purchasing agency will pay for the construction to be commenced or a guaranteed maximum price for the construction to be commenced. The construction to be commenced may be the entire project or may be one or more phased parts of the project.

D. A contract for professional services entered into as the result of a procurement under section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581 shall have a term not exceeding five years after the date of contract award by the purchasing agency of the first contract under the procurement, except that the contract may continue in effect after the five year term for professional services on projects on which the rendering of professional services commences within the five year term.

E. Notwithstanding any other law:

The contractor for design-build or job-order-contracting construction services is not required to be registered to perform design services pursuant to title 32, chapter 1 if the person or firm actually performing the design services on behalf of the contractor is appropriately registered.
The contractor for construction-manager-at-risk, design-build or job-order-contracting construction services shall be licensed to perform construction pursuant to title 32, chapter 10.

F. For job-order-contracting construction services only:

The maximum dollar amount of an individual job order shall be one million dollars or such higher or lower amount prescribed by the purchasing agency in an action noticed pursuant to title 38, chapter 3, article 3.1 or a rule adopted by the purchasing agency as the maximum amount of an individual job order. Requirements shall not be artificially divided or fragmented in order to constitute a job order that satisfies this requirement.
If the contractor subcontracts or intends to subcontract part or all of the work under a job order and if the job-order-contracting construction services contract includes descriptions of standard individual tasks, standard unit prices for standard individual tasks and pricing of job orders based on the number of units of standard individual tasks in the job order:

(a) The contractor has a duty to deliver promptly to each subcontractor invited to bid a coefficient to the contractor to do all or part of the work under one or more job orders:

(i) A copy of the descriptions of all standard individual tasks on which the subcontractor is invited to bid.

(ii) A copy of the standard unit prices for the individual tasks on which the subcontractor is invited to bid.

(b) If not previously delivered to the subcontractor, the contractor has a duty to deliver promptly the following to each subcontractor invited to or that has agreed to do any of the work included in any job order:

(i) A copy of the description of each standard individual task that is included in the job order and that the subcontractor is invited to perform.

(ii) The number of units of each standard individual task that is included in the job order and that the subcontractor is invited to perform.

(iii) The standard unit price for each standard individual task that is included in the job order and that the subcontractor is invited to perform.

G. Notwithstanding any contrary provision of this section or this title, a purchasing agency shall not:

Enter into a contract as contractor to provide construction-manager-at-risk construction services, design-build construction services or job-order-contracting construction services.
Contract with itself, with another purchasing agency, with this state or with any other governmental unit of this state or the federal government for the purchasing agency to provide construction-manager-at-risk construction services, design-build construction services or job-order-contracting construction services.

H. The prohibitions prescribed in subsection G of this section do not prohibit a purchasing agency from providing construction for itself as provided by law.

I. The purchasing agency shall include in each contract for construction services the full street or physical address of each separate location at which the construction will be performed and a requirement that the contractor and each subcontractor at any level include in each of its subcontracts the same address information. The contractor and each subcontractor at any level shall include in each subcontract the full street or physical address of each separate location at which construction work will be performed.

J. The following provisions apply to all construction services procured under section 41-2535, 41-2536, 41-2537, 41-2578 or 41-2579:

The contractor performing the construction services is permitted to self-perform part of the construction work, if and to the extent agreed in writing by the purchasing agency and the contractor. The purchasing agency may use methods other than competitive bidding to assure itself that the price the purchasing agency pays to the contractor for self-performed work is fair and reasonable. Permitted methods to evaluate fairness and reasonableness of the price of self-performed work include evaluation of the contractor's proposed scope of work and price for self-performed work by an estimator who is hired and paid by the purchasing agency, who is independent of the contractor and who may be an employee of the purchasing agency. Although the purchasing agency may elect to so require, nothing in this title or any other law shall be construed or interpreted to require the purchasing agency to require a contractor desiring to self-perform part of the construction work to competitively bid that part of the construction work against other contractors in a bid competition.
The following requirements apply to the construction work to be performed by subcontractors and do not apply to construction work that the purchasing agency and the contractor agree in writing will be self-performed by the contractor:

(a) The person or firm selected to perform the construction services shall select subcontractors based on qualifications alone or on a combination of qualifications and price and shall not select subcontractors based on price alone. A qualifications and price selection may be a single-step selection based on a combination of qualifications and price or a two-step selection. In a two-step selection, the first step shall be based on qualifications alone and the second step may be based on a combination of qualifications and price or on price alone.

(b) The purchasing agency shall include in each contract:

(i) If the purchasing agency included its subcontractor selection plan in the request for qualifications, the purchasing agency's subcontractor selection plan and the procedures to implement the purchasing agency's subcontractor selection plan proposed by the selected person or firm in submitting its qualifications with those modifications to the procedures as the purchasing agency and the selected person or firm agree.

(ii) If the purchasing agency did not include its subcontractor selection plan in the request for qualifications, the subcontractor selection plan proposed by the selected person or firm in submitting its qualifications with those modifications as the purchasing agency and the selected person or firm agree.

(c) In making the selection of subcontractors, the person or firm selected to perform the construction services shall use the subcontractor selection plan and any procedures included in its contract.

§ 41-2581 Procurement of certain professional services

A. A purchasing agency may procure under this section a single contract or multiple contracts for professional services if the contract is for professional services by an architect or architect firm and the contract amount is two hundred fifty thousand dollars or less or if the contract is for professional services by a person or firm other than an architect and the contract amount is five hundred thousand dollars or less. For such procurements, the director shall encourage persons or firms engaged in the lawful practice of the profession to submit annually a statement of qualifications and experience.

B. The director or head of the purchasing agency shall initiate an appropriately qualified selection committee for each procurement, which may include one contract or multiple contracts, pursuant to rules adopted by the director or purchasing agency. The amount of each contract in a single procurement under this section shall not exceed the dollar amount limits in subsection A. The selection committee shall evaluate current statements of qualifications and experience on file with the director or purchasing agency, together with those that may be submitted by other persons or firms regarding the procurement. If possible and practicable, the selection committee shall conduct interviews regarding the procurement and the relative methods of furnishing the required services and, if possible, shall select, in order of preference and based on criteria established and published by the selection committee, one or more final lists of the persons or firms deemed to be the most qualified to provide the services required. The selection committee shall base the selection of each final list and the order of preference on demonstrated competence and qualifications only. The purchasing agency and the selection committee shall not request or consider fees, price, man-hours or any other cost information at any point in the selection process under this section, including the selection of the persons or firms to be interviewed, the selection of the persons and firms to be on a final list, in determining the order of preference of persons and firms on a final list or for any other purpose in the selection process. If the procurement is for:

A single contract or if the procurement is for multiple contracts to be awarded to a single person or firm, there shall be one final list of three persons or firms.
Multiple contracts for different professional services to be awarded to separate persons or firms, there shall be a separate final list of three persons or firms for each contract.
Multiple contracts for the same professional services to be awarded to separate persons or firms, there shall be one final list and the number of persons or firms on the final list shall be the number of contracts plus another number that is determined by the purchasing agency and that is not more than five.

C. After each final list is selected pursuant to subsection B, the procurement officer shall enter into negotiations with the highest qualified person or firm on each final list or, in the case of a single final list for multiple contracts for the same professional services to be awarded to separate persons or firms, the purchasing agency shall enter into negotiations with a number of the highest qualified persons or firms on the final list equal to the number of contracts that may or will be awarded. The negotiations shall include consideration of compensation and other contract terms that the procurement officer determines to be fair and reasonable to this state. In making this determination, the procurement officer shall take into account the estimated value, the scope, the complexity and the nature of the professional services to be rendered. If the procurement officer is unable to negotiate a satisfactory contract with a person or firm with which the purchasing agency is negotiating at a price and on other contract terms the procurement officer determines to be fair and reasonable to this state, the procurement officer shall formally terminate negotiations with that person or firm. The procurement officer may undertake negotiations with the next most qualified person or firm on the final list in sequence until an agreement is reached or a determination is made to reject all persons or firms on the final list. If the procurement officer terminates negotiations with a person or firm on a final list and commences negotiations with another person or firm on the final list, the procurement officer shall not in that procurement recommence negotiations or enter into the single contract or multiple contracts for the professional services covered by that final list with any person or firm on that final list with whom the procurement officer has terminated negotiations.

D. If the purchasing agency does not have a procurement protest policy and procedures that have been formally adopted and published by the purchasing agency, for protests relating to procurements under this section the purchasing agency shall follow the procurement protest policy and procedures of the department. The purchasing agency shall process all protests relating to procurements under this section.

§ 41-2582 Project delivery methods for design and construction services

A. A purchasing agency may procure design services, construction and construction services, as applicable, under any of the following project delivery methods:

Design-bid-build.
Construction-manager-at-risk.
Design-build.
Job-order-contracting.

B. For the design-bid-build project delivery method, the director shall procure:

Design services pursuant to section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581.
Construction by competitive sealed bidding, except as otherwise provided in section 41-2532.

C. The director shall procure construction services under the construction-manager-at-risk, design-build and job-order-contracting project delivery methods pursuant to section 41-2535, 41-2536, 41-2537, 41-2578 or 41-2579.

D. The director shall procure design services relating to a construction-manager-at-risk construction services project pursuant to section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581.

E. For job-order-contracting construction services projects, if the director does not include design services in the job-order-contracting construction services contract, the director shall procure any design services relating to job-order-contracting construction services projects under the contract pursuant to section 41-2535, 41-2536, 41-2537, 41-2578, 41-2579 or 41-2581.

§ 41-2583 Construction contracts; design professional service contracts; void provisions

A provision, covenant, clause or understanding in, collateral to or affecting a construction contract or design professional service contract that makes the contract subject to the laws of another state or that requires any litigation, arbitration or other dispute resolution proceeding arising from the contract to be conducted in another state is against this state's public policy and is void and unenforceable.

Article 6 Contract Clauses

§ 41-2585 Contract clauses

A. The director may permit or require the inclusion of clauses providing for appropriate remedies, adjustments in prices, time of performance or other contract provisions.

B. The director may modify clauses for inclusion in any particular state contract, provided that any variations are supported by a written determination that states the circumstances justifying the variation and provided that notice of any material variation is stated in the solicitation.

C. All contract clauses shall be consistent with the provisions of this chapter and the regulations issued pursuant to this chapter.

§ 41-2586 State preemption; indemnity agreements in construction and design professional services contracts void; definitions

A. A covenant, clause or understanding in, collateral to or affecting a construction contract or subcontract that purports to indemnify, to hold harmless or to defend the promisee of, from or against liability for loss or damage resulting from the negligence of the promisee or the promisee's agents, employees or indemnitee is against the public policy of this state and is void.

B. The regulation and use of indemnity agreements in construction and design professional services contracts are of statewide concern. The regulation of indemnity agreements in construction and design professional services contracts pursuant to this section and their use are not subject to further regulation by a county, city, town or other political subdivision of this state.

C. If a design professional provides work, services, studies, planning, surveys or other preparatory work in connection with a public building or improvement, the state purchasing agency, state governmental unit or property owner may require that the design professional services contract or subcontract require the design professional to indemnify and hold harmless the state purchasing agency, state governmental unit or property owner, and its officers and employees, from liabilities, damages, losses and costs, including reasonable attorney fees and court costs, but only to the extent caused by the negligence, recklessness or intentional wrongful conduct of such design professional or other persons employed or used by such design professional in the performance of the contract or subcontract. A design professional services subcontract entered into in connection with a public building or improvement may also require any design professional to indemnify and hold harmless the purchasing agency, state governmental unit, or property owner and the indemnified design professional who executed the subcontract, and their respective owners, officers and employees, from liabilities, damages, losses and costs, including reasonable attorney fees and court costs, but only to the extent caused by the negligence, recklessness or intentional wrongful conduct of such design professional, or persons employed or used by the indemnifying design professional in connection with the subcontract. Nothing in this section shall prohibit the requirement of insurance coverage that complies with this section, including the designation of the state, state purchasing agency, state governmental unit or property owner as an additional insured on a general liability insurance policy or as a designated insured on an automobile liability policy provided in connection with a construction contract or subcontract or design professional services contract or subcontract.

D. A covenant, clause or understanding in, collateral to or affecting a design professional services subcontract that purports to indemnify, to hold harmless or to defend the promisee of, from or against liability for loss or damage resulting from the negligence of the promisee or the promisee's agents, employees or indemnitee is against the public policy of this state and is void.

E. Except as provided in subsection C of this section, a design professional services contract or subcontract entered into in connection with a public building or improvement shall not require that a design professional defend, indemnify, insure or hold harmless the state purchasing agency, state governmental unit or property owner or its employees, officers, directors, agents, contractors or subcontractors from any liability, damage, loss, claim, action or proceeding, and any contract provision that is not permitted by subsection C of this section is against the public policy of this state and is void.

F. Notwithstanding subsection A of this section, a contractor who is responsible for the performance of a construction contract or subcontract may fully indemnify a person, firm, corporation, state or other agency for whose account the construction contract or subcontract is not being performed and that, as an accommodation, enters into an agreement with the contractor that permits the contractor to enter on or adjacent to its property to perform the construction contract or subcontract for others.

G. If any provision or condition contained in this section conflicts with any provision of a contract between the state or a political subdivision of the state and the federal government, such provision of this section in conflict shall not apply to any construction contract or subcontract, or design professional services contract or subcontract to the extent such conflict exists, but all provisions of this section with which there is no such conflict, shall apply.

H. For the purposes of this section:

"Construction contract or subcontract" means a written or oral agreement relating to the construction, alteration, repair, maintenance, relocation, moving, demolition or excavation of a structure, street or roadway, appurtenance, facility, development or other improvement to land.
"Design professional services" means architect services, engineer services, land surveying services, geologist services or landscape architect services or any combination of those services performed by or under the supervision of a design professional or any person employed by the design professional.
"Design professional service contract or subcontract" means a written or oral agreement relating to the planning, design, construction administration, study, evaluation, consulting, inspection, surveying, mapping, material sampling, testing or other professional, scientific or technical services furnished in connection with any actual or proposed study, planning, survey, environmental remediation, construction, improvement, alteration, repair, maintenance, relocation, moving, demolition or excavation of a structure, street or roadway, appurtenance, facility, development or other improvement to land.
"Other person employed or used" means a subcontractor to a contractor or design professional in any tier, or any other person or entity who performs work or design professional services, or provides labor, services, materials or equipment in connection with a construction contract or subcontract or design professional service contract or subcontract subject to this section.

Article 7 Cost Principles

§ 41-2591 Cost principles rules

The director shall adopt rules setting forth cost principles which shall be used to determine the allowability of incurred costs for the purpose of reimbursing costs under contract provisions which provide for the reimbursement of costs.

Article 8 Materials Management

§ 41-2601 Definitions

In this article, unless the context otherwise requires:

"Excess materials" means any materials which have a remaining useful life but which are no longer required by the using agency in possession of the materials.
"Nonexpendable materials" means all tangible materials which have an original acquisition cost over an amount set by regulation and a probable useful life of more than one year.
"Surplus materials" means any materials that no longer have any use to this state or materials acquired from the United States government. This includes obsolete materials, scrap materials and nonexpendable materials that have completed their useful life cycle.

§ 41-2602 Material management rules

The director shall adopt rules governing:

The management of materials during their entire life cycle.
The acquisition and distribution of federal surplus materials.
The sale, lease or disposal of surplus materials by public auction, competitive sealed bidding or other appropriate method designated by rule.
The purchase of any such materials by an employee of the owning or disposing agency.
The transfer of excess and surplus materials.
The trade-in of excess or surplus materials.

§ 41-2603 Surplus material program

The department may acquire surplus materials from the United States government and may distribute surplus materials as may be usable and necessary for public purposes to a state governmental unit or a political subdivision.

§ 41-2604 Authority for transfer of material

Notwithstanding any law to the contrary, the governing board, or in case there is none, the executive head of any state governmental unit, political subdivision or nonprofit institution determined to be eligible to receive surplus materials, may confer on any officer or employee thereof continuing authority to secure the transfer to it of surplus materials and to obligate its monies to the extent necessary to comply with the laws and conditions of such transfers. The director shall adopt rules establishing guidelines for use in determining eligibility.

§ 41-2605 Fees and charges

The department shall make proper charges and assess proper fees for the acquisition, receipt, warehousing, rehabilitation, delivery, distribution or transfer of excess and surplus materials. Such fees and charges shall be fair and equitable and shall be based on services performed, including acquisition, receipt, warehousing, rehabilitation, delivery, distribution or transfer. A reasonable charge shall be made for maintenance and repair services.

§ 41-2606 Surplus materials revolving funds

A. The state surplus materials revolving fund is established. All monies coming into the department derived from state surplus materials fees and charges shall be placed in the state surplus materials revolving fund. All uncommitted monies in the state surplus materials revolving fund in excess of one hundred thousand dollars at the close of any fiscal year revert to the state general fund.

B. The federal surplus materials revolving fund is established. All monies coming into the department derived from federal surplus materials shall be placed in the federal surplus materials revolving fund. All uncommitted monies in the federal surplus materials revolving fund in excess of fifty thousand dollars at the close of any fiscal year shall be returned to agencies and institutions through discounted service and handling charges to eligible donees in the following fiscal year until the surplus is depleted.

C. Monies in the funds shall be available, subject to legislative appropriation, for the purpose of carrying out the provisions of this article.

§ 41-2607 Allocation of proceeds from sales, transfers or disposal of surplus materials

Unless otherwise provided by law, the director shall adopt rules for the allocation of proceeds from the sale, transfer, lease or disposal of excess and surplus materials.

Article 9 Legal and Contractual Remedies

§ 41-2611 Rules of procedure

A. The director may adopt rules of procedure providing for the expeditious administrative review of all contract claims or controversies both before the purchasing agency and through an appeal heard before the director in accordance with chapter 6, article 10 of this title.

B. For the purposes of an expeditious administrative process, the director shall render a decision on an appeal to the director within forty-two days after the date the agency report or comments on the agency report, if applicable, are filed with the director. On agreement of all interested parties, the director may be granted an additional fourteen days to issue a decision. If the director fails to issue a decision within the time period prescribed in this subsection, the director shall refer the appeal to a hearing in accordance with chapter 6, article 10 of this title.

§ 41-2612 Subject of rules

The rules adopted by the director pursuant to section 41-2611 shall address at least the following subjects:

Protested solicitations and awards.
Vendor performance and evaluation of past performance.
Suspension or debarment of contractors.
Breach of contract controversies and contract claims.

§ 41-2613 Debarment and suspension of contractors

A. The director shall adopt rules providing for the suspension and debarment of any person from consideration for award of contracts pursuant to this chapter. If there are reasonable grounds for debarment the rules of the director may provide for the suspension of any person for not to exceed six months. A debarment shall not exceed three years.

B. The causes for debarment or suspension include the following:

Conviction of any person or any subsidiary or affiliate of any person for commission of a criminal offense arising out of obtaining or attempting to obtain a public or private contract or subcontract, or in the performance of such contract or subcontract.
Conviction of any person or any subsidiary or affiliate of any person under any statute of the federal government, this state or any other state for embezzlement, theft, fraudulent schemes and artifices, fraudulent schemes and practices, bid rigging, perjury, forgery, bribery, falsification or destruction of records, receiving stolen property or any other offense indicating a lack of business integrity or business honesty which affects responsibility as a state contractor.
Conviction or civil judgment finding a violation by any person or any subsidiary or affiliate of any person under state or federal antitrust statutes.
Violations of contract provisions of a character which are deemed to be so serious as to justify debarment action, such as either of the following:

(a) Knowingly fails without good cause to perform in accordance with the specification or within the time limit provided in the contract.

(b) Failure to perform or unsatisfactory performance in accordance with the terms of one or more contracts, except that failure to perform or unsatisfactory performance caused by acts beyond the control of the contractor shall not be considered to be a basis for debarment.

Any other cause deemed to affect responsibility as a state contractor, including suspension or debarment of such person or any subsidiary or affiliate of such person by another governmental entity for any cause listed in rules of the director.

C. A written determination to debar or suspend shall be issued pursuant to the rules of the director which shall:

State the reasons for the action taken.
Inform any debarred or suspended person involved of the right to administrative review as provided in this article.

D. A copy of the decision under subsection C shall be mailed or otherwise furnished to any debarred or suspended person and to any intervening party.

§ 41-2614 Judicial review

Except as provided in section 41-1092.08, subsection H, any final decision of the director under this chapter is subject to judicial review pursuant to title 12, chapter 7, article 6 by any party to the proceeding before the director, and the complaint seeking review shall be filed with the superior court in Maricopa county and served on the director and the purchasing agency.

§ 41-2615 Exclusive remedy

Notwithstanding any law to the contrary, including title 12, chapter 7, article 2 and title 12, chapter 21, this article and the rules adopted under this article shall provide the exclusive procedure for asserting a claim against this state or any agency of this state arising in relation to any procurement conducted under this chapter.

§ 41-2616 Violation; classification; liability; civil penalty; enforcement authority

A. A person who contracts for or purchases any material, services, construction or construction services in a manner contrary to the requirements of this chapter, the rules adopted pursuant to this chapter, the rules adopted by the state board of education pursuant to section 15-213 or rules adopted by the Arizona board of regents, the Arizona lottery commission or the judicial branch pursuant to section 41-2501 is personally liable for the recovery of all public monies paid plus twenty per cent of such amount and legal interest from the date of payment and all costs and damages arising out of the violation.

B. A person who intentionally or knowingly contracts for or purchases any material, services, construction or construction services pursuant to a scheme or artifice to avoid the requirements of this chapter, rules adopted pursuant to this chapter, rules adopted by the state board of education pursuant to section 15-213 or rules adopted by the state board of regents, the state lottery commission or the judicial branch pursuant to section 41-2501 is guilty of a class 4 felony.

C. A person who serves on an evaluation committee for a procurement shall sign a statement before reviewing bids or proposals that the person has no interest in the procurement other than that disclosed and will have no contact with any representative of a competing vendor related to the particular procurement during the course of evaluation of bids or proposals, except those contacts specifically authorized by section 41-2534, 41-2537, 41-2538, 41-2578, 41-2579 or 41-2581. The person shall disclose on the statement any contact unrelated to the pending procurement that the person may need to have with a representative of a competing vendor and any contact with a representative of a competing vendor during evaluation of bids or proposals except those contacts specifically authorized by section 41-2534, 41-2537, 41-2538, 41-2578, 41-2579 or 41-2581. A person who serves on an evaluation committee and who fails to disclose contact with a representative of a competing vendor or who fails to provide accurate information on the statement is subject to a civil penalty of at least one thousand dollars but not more than ten thousand dollars.

D. The attorney general on behalf of this state shall enforce the provisions of this chapter.

§ 41-2617 Contracts for procurement of construction; delay; recovery of damages by contractor

A contract for the procurement of construction shall include a provision which provides for negotiations between the state governmental unit and the contractor for the recovery of damages related to expenses incurred by the contractor for a delay for which the state governmental unit is responsible, which is unreasonable under the circumstances and which was not within the contemplation of the parties to the contract. This section shall not be construed to void any provision in the contract which requires notice of delays, provides for arbitration or other procedure for settlement or provides for liquidated damages.

Article 10 Intergovernmental Procurement

§ 41-2631 Definitions

In this article, unless the context otherwise requires:

"Cooperative purchasing" means procurement conducted by, or on behalf of, more than one public procurement unit.
"External procurement activity" means any buying organization not located in this state that would qualify as a public procurement unit.
"Local public procurement unit" means any political subdivision, any agency, board, department or other instrumentality of such political subdivision and any nonprofit corporation created solely for the purpose of administering a cooperative purchase under this article.
"Nonprofit corporation" means any nonprofit corporation as designated by the internal revenue service under section 501(c)(3) through 501(c)(6) or under section 115, if created by two or more local public procurement units, and includes certified nonprofit agencies that serve individuals with disabilities as defined in section 41-2636.
"Public procurement unit" means either a local public procurement unit, the department, any other state or an agency of the United States.

§ 41-2632 Cooperative purchasing authorized; definitions

A. Any public procurement unit may either participate in, sponsor, conduct or administer a cooperative purchasing agreement to procure any materials, services, professional services, construction or construction services with one or more public procurement units or external procurement activities in accordance with an agreement entered into between the participants. The cooperative purchasing may include joint or multiparty contracts between public procurement units and open-ended public procurement unit contracts that are available to local public procurement units. A nonprofit corporation may enter into an agreement pursuant to this section if one or more of the parties involved is a public procurement unit. An agreement entered into as provided in this article is exempt from section 11-952, subsection D. Parties under a cooperative purchasing agreement may:

Sponsor, conduct or administer a cooperative agreement to procure or dispose of any materials, services or construction.
Cooperatively use materials or services.
Commonly use or share warehousing facilities, capital equipment and other facilities.
Provide personnel, except that the requesting public procurement unit shall pay the public procurement unit providing the personnel the direct and indirect cost of providing the personnel, in accordance with the agreement.
On request, make available to other public procurement units informational, technical or other services or software that may assist in improving the efficiency or economy of procurement. The public procurement unit furnishing the informational, technical or other services or software has the right to request reimbursement for the reasonable and necessary costs of providing these services or software.
Pursuant to the rules for cooperative purchasing adopted by the director, purchase materials, services, professional services, construction or construction services under the terms of a contract between a vendor and a public procurement unit or an external procurement activity without complying with the requirements of sections 41-2533, 41-2534 and 41-2535.

B. The division of school facilities within the department of administration or school districts, or both, may enter into an agreement with a public procurement unit pursuant to this section for the purpose of procuring materials and services needed to correct deficiencies in school facilities.

C. The activities described in this section do not limit what parties may do under a cooperative purchasing agreement.

D. A nonprofit corporation operating as a public procurement unit under this section, on request of the auditor general, shall provide to the auditor general all documentation concerning any cooperative purchasing transaction the public procurement unit administers under this section.

E. A nonprofit corporation operating as a public procurement unit under this section shall comply with all procurement laws applicable to the public procurement unit participating in a cooperative purchasing transaction that the nonprofit corporation administers.

F. This section does not abrogate the responsibility of each public procurement unit to ensure compliance with procurement laws that apply to the particular public procurement, notwithstanding the fact that the cooperative purchase is administered by a nonprofit corporation operating under this section.

G. Any public procurement unit conducting or administering a cooperative purchasing agreement to procure construction services or professional services shall comply with the requirements of section 34-603 or 41-2578.

H. For the purposes of this section:

"Construction services" has the same meaning prescribed in section 41-2503.
"Professional services" has the same meaning prescribed in section 41-2578.

§ 41-2633 Use of payments received by a supplying public procurement unit

All payments received by a public procurement unit supplying personnel or services shall be available to the supplying public procurement unit to defray the cost of the cooperative program.

§ 41-2634 Public procurement units in compliance with chapter requirements

If the public procurement unit administering a cooperative purchase complies with the requirements of this chapter, any public procurement unit participating in such a purchase is deemed to have complied with this chapter. Public procurement units may not enter into a cooperative purchasing agreement for the purpose of circumventing this chapter.

§ 41-2635 Contract controversies

A. Under a cooperative purchasing agreement in which this state is a party, controversies arising between an administering public procurement unit and its bidders, offerors or contractors shall be resolved in accordance with article 9 of this chapter.

B. Any local public procurement unit which is not subject to article 9 of this chapter may enter into an agreement with a public procurement unit to establish procedures or use such unit's existing procedures to resolve controversies with contractors, whether or not such controversy arose from a cooperative purchasing agreement.

§ 41-2636 Procurement from certified nonprofit agencies that serve individuals with disabilities and Arizona correctional industries; definitions

A. The director shall appoint a state set-aside committee to determine those materials and services that are provided, manufactured, produced and offered for sale by certified nonprofit agencies that serve individuals with disabilities and Arizona correctional industries and that satisfy the requirements of state governmental units and to establish a fair market price for all approved materials and services offered for sale that meet these requirements. Membership shall include the assistant director for rehabilitation services in the department of economic security or the assistant director's designee and a private sector businessperson appointed by the governor who contracts or employs persons with disabilities in the private sector. At each quarterly meeting the director shall report on new procurement requests or renewal of existing procurement requests for state purchases from lists supplied by set-aside providers and that are within the capability of and that can be supplied by the entities that are prescribed in this section. To qualify for set-aside contracts, certified nonprofit agencies must maintain an employment ratio of at least sixty percent of program employees with significant disabilities.

B. Materials and services from Arizona correctional industries shall be presented to the committee for approval. Office products, vinyl binders and furniture refurbishing services shall be exempt from this article. State governmental units shall purchase office products, vinyl binders and furniture from Arizona correctional industries if each of the following applies:

Such materials and services are readily available.
Such materials and services are capable of timely delivery.
Such materials and services are of equal quality and price for these same materials and services in the private sector.

C. State governmental units shall purchase approved materials and services if such materials and services are readily available.

D. Notwithstanding the requirements of section 41-2532, state governmental units and local public procurement units may purchase or contract for any products, materials and services directly from certified nonprofit agencies that serve individuals with disabilities and Arizona correctional industries without competitive bidding if the delivery and quality of the products, materials or services meet the unit's reasonable requirements.

E. All state governmental units shall endeavor to set aside at least one percent of their new purchases or contracts for any products, materials and services from the entities that are prescribed in subsection D of this section, except for contracts for care and services for clients of the department of child safety, the department of economic security or the department of health services. The department shall communicate with each state governmental unit regarding its responsibility to comply with this subsection. The committee shall meet quarterly to report progress in increasing state governmental purchases or contracts with the entities that are prescribed in subsection D of this section. The committee shall compile quarterly reports detailing new purchases or contracts that are entered into pursuant to this subsection to the director, each committee member, the governor, the president of the senate and the speaker of the house of representatives.

F. The committee shall meet during the first month of each fiscal year to determine which articles, products or services Arizona correctional industries and certified nonprofit agencies that serve individuals with disabilities should continue to manufacture for state use, to advise such agencies and industries of any changes in specifications and to identify new articles or products that should be manufactured or could be eligible for procurement.

G. For the purposes of this section:

"Certified nonprofit agency that serves individuals with disabilities" means a nonprofit activity center that serves individuals with significant disabilities and that satisfies all of the following:

(a) Is organized under the laws of this state or another state, is operated in the interest of individuals with disabilities and the net income of which does not inure in whole or in part to the benefit of any shareholder or other individual.

(b) Complies with any applicable occupational health and safety standard required by the laws of the United States and this state.

"Individuals with disabilities" means an individual who, because of the nature of the individual's disabilities, is not able to fully participate in competitive employment and for whom specialized employment and training are necessary by a qualified nonprofit organization through the department of economic security or the department of health services.

§ 41-2637 Compliance with federal requirements

If a procurement involves the expenditure of federal assistance or contract monies, the director shall comply with federal law and authorized regulations which are mandatorily applicable and which are not presently reflected in this chapter.

Article 12 State Agency Recycling Materials Program

§ 41-2661 State agency office paper recycling

A. For purposes of this article, the definitions found in section 49-831 apply to this article.

B. The department shall require that all state governmental units, including universities, establish a program for the recycling of all wastepaper generated by those units including, at a minimum, high grade office paper and corrugated paper. Under the program, each unit shall ensure the separate collection of approximately fifty per cent of the office wastepaper generated by each unit not later than November 1, 1991.

C. The department shall establish procedures for collecting and storing the wastepaper containers to be used in this program.

D. The department shall administer the contracts with buyers of wastepaper.

E. On or before January 31 of each year, the director of the department of administration shall evaluate the amount of wastepaper recycled by state governmental units and make all necessary modifications to the administration of the program to maximize the amount of wastepaper that is effectively and practicably recycled.

Article 13 On-Line Bidding

§ 41-2671 Definitions

In this article, unless the context otherwise requires:

"Information services" means data processing, telecommunications and office systems technologies and services.
"Internet" means the international computer network of both federal and nonfederal interoperable packet switched data networks, including the graphical subnetwork called the world wide web.
"On-line bidding" means a procurement process in which public agencies receive vendors' bids for goods, services, construction or information services electronically over the internet in a real-time, competitive bidding event.

§ 41-2672 On-line bidding

A. If a procurement officer determines that electronic, on-line bidding is more advantageous than other procurement methods provided in this chapter, a procurement officer may use on-line bidding to obtain bids electronically for the purchase of goods, services, construction and information services.

B. An on-line bidding solicitation must designate an opening date and time.

C. The closing date and time for an on-line solicitation may be fixed or remain open depending on the structure of the item being bid on line. Information regarding the closing date and time must be included in the solicitation. At the opening date and time, the purchasing agency must begin accepting on-line bids and must continue accepting bids until the bid is officially closed.

D. All on-line bids must be posted electronically and updated on a real-time basis.

E. Purchasing agencies may:

Require bidders to register before the opening date and time and, as part of that registration, require bidders to agree to any terms, conditions or other requirements of the solicitation.
Prequalify bidders and allow only those bidders who are prequalified to submit bids on line.

F. Purchasing agencies retain their existing authority to determine the criteria that will be used as a basis for making awards.

G. Sections 41-2533 and 41-2534 do not apply to solicitations issued pursuant to this section, except that:

All bids submitted electronically through an on-line bidding process are public information and are subject to the same public disclosure laws that govern bids received through the sealed bid process.
All remedies available to purchasing agencies and to bidders through the sealed bid process under this chapter are also available to purchasing agencies and bidders in an on-line bidding process.

§ 41-2673 State electronic commerce fund

A. The state electronic commerce fund is established consisting of monies appropriated by the legislature and any gifts, grants or devises for the benefit of the fund. The department shall administer the fund. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Monies in the fund shall be used to help finance electronic commerce initiatives by purchasing agencies if other funding mechanisms do not exist or cannot be used. The department shall disburse monies in the fund to purchasing agencies based on agency requests and statewide electronic commerce priorities.

C. If a purchasing agency realizes savings through implementation of its electronic commerce initiative funded by the state electronic commerce fund, the purchasing agency shall repay the fund the amount of monies originally disbursed to the agency plus ten per cent of the agency savings. The purchasing agency may retain the remainder of the savings generated through its electronic commerce initiative.

D. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

Chapter 24 Solicitation and Award of Grants

Article 1 General Provisions

§ 41-2701 Definitions

In this chapter, unless the context otherwise requires:

"Grant" means the furnishing of financial or other assistance, including state funds or federal grant funds, by any state governmental unit to any person for the purpose of supporting or stimulating educational, cultural, social or economic quality of life.
"Person" means any corporation, business, individual, committee, club or other organization or group of individuals.
"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.

§ 41-2702 Solicitation and award of grant applications

A. State governmental units shall award any grant in accordance with the competitive grant solicitation requirements of this chapter.

B. A state governmental unit shall prepare and issue a request for grant applications that includes at least the following information:

A description of the nature of the grant project, including the scope of the work to be performed by an awardee.
An identification of the funding source and the total amount of available funds.
Whether a single award or multiple awards may be made.
Encouragement of collaboration by entities for community partnerships, if appropriate.
Any additional information required by the applications.
The criteria or factors under which applications will be evaluated for award and the relative importance of each criteria or factor.
The due date for submittal of applications and the anticipated time the awards may be made.

C. Adequate public notice of the request for grant applications shall be given at least six weeks before the due date for the submittal of applications. Adequate notification of the request for grant applications shall also be provided to the central state permitting program pursuant to section 41-1505.08.

D. A preapplication conference may be conducted before the due date for the submittal of applications to explain the grant application requirements. If a preapplication conference is held, it shall be held at least twenty-one days before the due date. Statements made at a preapplication conference are not amendments to the request for grant applications unless a written amendment is issued.

E. Grant applications shall be publicly received at the time and place designated in the request for grant applications. The name of each applicant shall be publicly read and recorded. All other information in the grant application is confidential during the process of evaluation. All applications shall be open for public inspection after grants are awarded. To the extent the applicant designates and the state concurs, trade secrets and other proprietary information contained in the application shall remain confidential.

F. Applications shall be evaluated by at least three evaluators who are peers or other qualified individuals. The evaluators may allow applicants to make oral or written presentations regarding the scope of work, terms and conditions of the grant, budget and other relevant matters set forth in the request for grant applications. Applicants shall be accorded fair treatment with respect to any opportunity for oral or written presentations. The evaluators may require an applicant to revise its application to reflect information provided in an oral or written presentation. Any person who has information contained in the application of competing applications shall not disclose that information.

G. The evaluators shall review each application based solely on the evaluation criteria or factors set forth in the request for grant applications. The evaluators shall maintain a written record of the assessment of each application, which shall include comments regarding compliance with each evaluation criteria or factor, the citation of a specific criteria or factor as the basis of each stated strength or weakness and a clear differentiation between comments based on facts presented in the application and comments based on professional judgment. Evaluator assessments shall be made available for public inspection no later than thirty days after a formal award is made.

H. The evaluators shall make award recommendations to the head of the state governmental unit based on the evaluators' reviews of each application. The evaluators' recommendations may include the adjustment of the budgets of the applicants individually or collectively.

I. The head of the state governmental unit may affirm, modify or reject the evaluators' recommendations in whole or in part. Modification of the evaluators' recommendations may include the adjustment of the budget on any proposed award individually or on all awards by an amount or percentage. If the head of the state governmental unit does not affirm the recommendations, the head of the state governmental unit shall document in writing the specific justifications for the action taken. The specific justifications shall be made available for public inspection no later than thirty days after the action is taken.

J. The head of a state governmental unit may enter into agreements with other state governmental units to furnish assistance in conducting the solicitation of grant applications.

§ 41-2703 Waiver of solicitation and award procedures

A. Notwithstanding any other provision of this chapter, the director of the department of administration or the director's designee may waive the solicitation and award procedures if a situation exists that makes compliance with section 41-2702 impracticable, unnecessary or contrary to the public interest, except that the grant solicitation and award shall be made with competition that is practicable under the circumstances.

B. A state governmental unit seeking a waiver of solicitation and award procedures shall prepare a written request documenting and explaining the situation justifying the waiver. The request shall be submitted to the director of the department of administration or the director's designee, who shall determine in writing whether to grant the request. If the request is granted, the determination shall state the manner in which the grant is to be solicited and awarded and the limits of the determination.

C. A copy of each request and determination shall be kept on file in the office of the state governmental unit requesting the waiver and the office of the director of the department of administration or the office of the director's designee.

§ 41-2704 Remedies

The head of the state governmental unit may resolve protests of the award or proposed award of a grant. An appeal from a decision of the head of a state governmental unit may be made to the director of the department of administration. A protest of an award or proposed award of a grant and any appeal shall be resolved in accordance with the rules of procedure adopted by the director pursuant to section 41-2611.

§ 41-2705 Violation; classification; liability; enforcement authority

A. A person who violates this chapter is personally liable for the recovery of all public monies paid plus twenty per cent of the amount and legal interest from the date of payment and all costs and damages arising out of the violation.

B. A person who intentionally or knowingly participates in the award of a grant pursuant to a scheme or artifice to avoid the requirements of this chapter is guilty of a class 4 felony.

C. A person who serves as an evaluator of grant applications pursuant to this chapter shall sign a statement before reviewing applications that the person has no interest in any application other than that disclosed and shall not have contact with any representative of an applicant during the evaluation of applications, except those contacts specifically authorized by this chapter. The person shall disclose on the statement any contact unrelated to the review of the grant applications that the person may need to have with a representative of an applicant and any contact with a representative of an applicant during evaluation of applications except those specifically authorized by this chapter. A person who serves as an evaluator and who fails to disclose contact with a representative of an applicant or who fails to provide accurate information on the statement is subject to a civil penalty of at least one thousand dollars but no more than ten thousand dollars.

D. The attorney general on behalf of this state shall enforce the provisions of this chapter.

§ 41-2706 Applicability of chapter

A. This chapter applies to the solicitation of grants initiated after August 6, 1999.

B. This chapter does not apply to:

Any grant program that was exempt from chapter 23, article 3 of this title and for which administrative rules establishing grant solicitation procedures were adopted pursuant to chapter 6 of this title before August 6, 1999.
The Arizona board of regents and schools, colleges, institutions and universities under its control if the Arizona board of regents adopts rules or policies governing the award of grants that encourage as much competition as practicable.
Grants made by the cotton research and protection council for research programs related to cotton production or protection.
Grants made by the Arizona iceberg lettuce research council for research programs under section 3-526.02, subsection C, paragraph 3 or 5.
Grants made by the Arizona citrus research council for research programs under section 3-468.02, subsection C, paragraph 3 or 5.
Grants made by the Arizona grain research and promotion council for research projects and programs under section 3-584, subsection C, paragraph 5.
Grants made under section 3-268, subsection C.
Grants made by the Arizona commerce authority from the Arizona competes fund pursuant to chapter 10, article 5 of this title. With respect to other grants, the authority shall adopt policies, procedures and practices, in consultation with the department of administration, that are similar to and based on the policies and procedures prescribed by this chapter for the purpose of increased public confidence, fair and equitable treatment of all persons engaged in the process and fostering broad competition while accomplishing flexibility to achieve the authority's statutory requirements. The authority shall make its policies, procedures and practices available to the public.
Grants of less than five thousand dollars from the veterans' donations fund if the department of veterans' services adopts rules or policies governing these grants that encourage as much competition as practicable.

Chapter 25 State Government Competition with Private Enterprise

Article 1 General Provisions

§ 41-2751 Definitions

In this article, unless the context otherwise requires:

"Governing board" means the Arizona board of regents for the universities or any community college district governing board.
"Invited guests" means persons who enter onto a campus for an educational, research or public service activity and not primarily to purchase or receive goods and services not related to the educational, research or public service activity for which such persons enter onto the campus.
"Private enterprise" means an individual, firm, partnership, joint venture, corporation, association or any other legal entity engaging in the manufacturing, processing, sale, offering for sale, rental, leasing, delivery, dispensing, distributing or advertising of goods or services for profit.
"Public service" means an activity that is normally and generally associated with community colleges and universities in this state, a purpose or significant result of which is not to engage in competition with private enterprise.
"State agency" means a department, office, commission, institution, board or other agency of state organization regardless of whether monies are appropriated to the agency.

§ 41-2752 State competition with private enterprise prohibited; exceptions; definition

A. A state agency shall not engage in the manufacturing, processing, sale, offering for sale, rental, leasing, delivery, dispensing, distributing or advertising of goods or services to the public that are also offered by private enterprise unless specifically authorized by law other than administrative law and executive orders.

B. A state agency shall not offer or provide goods or services to the public for or through another state agency or a local agency, including by intergovernmental or interagency agreement, in violation of this section or section 41-2753.

C. The restrictions on activities that compete with private enterprise contained in this section do not apply to:

The development, operation and management of state parks, historical monuments and hiking or equestrian trails.
Correctional industries established and operated by the state department of corrections if the prices charged for products sold by the correctional industries are not less than the actual cost of producing and marketing the product plus a reasonable allowance for overhead and administrative costs.
The office of tourism.
The Arizona highways magazine, operated by the department of transportation.
Printing and distributing information to the public if the agency is otherwise authorized to do so, and printing or copying public records or other material relating to the public agency's public business and recovering through fees and charges the costs of such printing, copying and distributing.
The department of public safety.
The construction, maintenance and operation of state transportation facilities.
The development, distribution, maintenance, support, licensing, leasing or sale of computer software by the department of transportation.
Agreements executed by the Arizona health care cost containment system administration with other states to design, develop, install and operate information technology systems and related services or other administrative services pursuant to section 36-2925.
Agreements executed by the department of economic security with other states to design, develop, install and operate support collection technology systems and related services. The department shall deposit, pursuant to sections 35-146 and 35-147, monies received pursuant to this paragraph in the public assistance collections fund established by section 46-295.
Educational, vocational, treatment, training or work programs of the department of juvenile corrections and contracts between the department of juvenile corrections and this state, a political subdivision of this state or a private entity in order to provide employment or vocational educational experience.
The aflatoxin control technologies of the cotton research and protection council.
The lease or sublease of lands or buildings by the department of economic security pursuant to section 41-1958.
The Arizona commerce authority.
The Arizona game and fish commission, but only for the sale of goods or services and not firearms.
The lease or sublease of lands or buildings by the department of child safety pursuant to section 8-460.
Agreements executed by the department of child safety with other states to design, develop, install and operate support collection technology systems and related services. The department shall deposit, pursuant to sections 35-146 and 35-147, monies received pursuant to this paragraph in the child safety collections fund established by section 8-461.
The lease or sublease of state hospital lands or buildings by the department of health services.
The sale or lease of software, computer systems or intellectual property developed by the department of education or associated services provided for the sale or lease of software, computer systems or intellectual property by the department of education. The department shall deposit, pursuant to sections 35-146 and 35-147, sixty percent of the profit from the monies generated pursuant to this paragraph in the state general fund and the remaining forty percent in the department of education intellectual property fund established by section 15-231.04. The department of education may not transfer or expend monies or personnel resources for the purposes of marketing or soliciting goods or services authorized pursuant to this paragraph that were appropriated and authorized for other functions and programs of the department of education.
The lease or sublease of any real estate or related infrastructure by the department of emergency and military affairs pursuant to section 26-262, subsection K, paragraph 4.

D. The restrictions on activities that compete with private enterprise contained in subsection A of this section do not apply to community colleges and universities under the jurisdiction of a governing board.

E. For the purposes of this section, "profit" means any monies generated from the sale or lease of goods and services after accounting for the costs paid by this state, including appropriations from the state general fund.

§ 41-2753 Competition with private enterprise by community colleges and universities; limitations; rules; complaints

A. Community colleges and universities under the jurisdiction of a governing board shall not, unless specifically authorized by statute:

Provide to persons other than students, faculty, staff and invited guests goods, services or facilities that are practically available from private enterprise, unless the provision of the goods, service or facility offers a valuable educational or research experience for students as a part of their education or fulfills the public service mission of the community college or university. This paragraph does not apply to sponsoring or providing facilities for recreational, cultural and athletic events or to facilities providing food services and sales.
Enter competitive bidding for rendering any goods or services unless a clear educational or research advantage would accrue to this state by the community college or university rendering the goods or services. Any such bid shall fairly and fully allocate all direct and indirect costs unless the funding agency or sources provide for or require all bidders to use a specific procedure or formula for allocating costs.
Provide to students, faculty, staff or invited guests goods, services or facilities that are practically available from private enterprise except as authorized by the state governing board.
Provide goods, services or facilities for or through another state agency or a local agency, including by intergovernmental or interagency agreement, which, if provided directly by the contractor, would be in violation of this section or section 41-2752.

B. A governing board may adopt and implement rules or policies, as appropriate, to provide for the disposal by sale of products and by-products which are an integral part of research or instruction conducted by community colleges and universities under its jurisdiction if the products and by-products are not sold to a retailer or sold at retail to the public by the particular community college or university unless the sale is an integral part of the particular research project or instructional program or there is no other practical way of disposing by sale of the products or by-products, and if the products or by-products are sold at their market value.

C. A governing board shall adopt and implement rules or policies, as appropriate, to:

Regulate community college and university competition with private enterprise and ensure compliance with this section.
Regulate use of community college and university facilities by students, faculty, staff, invited guests and the general public.
Provide procedures for promptly hearing and resolving complaints lodged under this article relating to community colleges and state universities under the jurisdiction of the governing board. Such procedures shall include provisions for an expedited hearing process if it is determined the alleged competition may cause severe financial hardship on the person filing the complaint.

D. Any person aggrieved by a violation of this section may file a complaint with the governing board. The governing board shall hear complaints made pursuant to this section within sixty days and shall render its decision within thirty days after the hearing. A person does not have standing to challenge violations of this section in the courts of this state until the person has first made a complaint to the board and has received the board's decision.

E. This section does not apply to:

The Arizona health sciences center operated by the university of Arizona, except in those cases in which the health sciences center provides prosthetic or medical devices, or services related to such devices, and a surgical or medical procedure is not involved in the application of the device.
The provision of free medical services or equipment to indigents in association with a community service health program.
Public service radio and television stations licensed to the governing boards or to community colleges and universities under their jurisdiction.
Skill centers operated by the community college districts.

Article 2 Competitive Government Program

§ 41-2771 Definitions

In this article, unless the context otherwise requires:

"Competitive government process" means the process, as developed by the governor's office of management and budget, designed to standardize the methodology for how the state identifies and evaluates state functions to determine if future competitive contracting with the private sector and other state agencies is in the best interest of this state.
"Competitive government program" means the program, as developed by the governor's office of management and budget, designed to manage the process of introducing private sector and interagency competition into the delivery of state goods and services.
"Function" means a good or service that is provided through the direct efforts of state employees.
"Office" means the governor's office of management and budget, established by executive order, or its successor.
"Privatization" means the utilization of a private sector entity in the delivery of goods and services currently provided by a state function or program.
"Relevant costs" means those costs that relate to a target function that can be eliminated if the target function is transferred to another agency or the private sector.
"State agency" means any executive department, office, commission, institution, board or other executive agency of state organization regardless of whether monies are appropriated to the agency. State agency does not include the Arizona board of regents, the universities under its jurisdiction or community college districts.
"Target function" means a current state function that has been identified for review through the competitive government process.
"Total costs" means all costs borne by an agency to provide a state function including all indirect costs and applicable allocated costs.

§ 41-2772 Arizona state competitive government program

A. A statewide competitive government program shall be established within the governor's office of management and budget. The program shall emphasize this state's fiduciary responsibility to taxpayers by encouraging value in the provision and delivery of state services by identifying and pursuing opportunities for increasing the use of market forces in the delivery of state services, while preventing unfair competition between state agencies and the private sector.

B. The competitive government process shall be utilized whenever a state agency chooses to, or is compelled to, privatize a state function or program currently provided through the direct use of state employees.

C. The Arizona board of regents and the community college districts shall develop a program comparable to the competitive government program for themselves and institutions under their jurisdiction and shall present a report to the office on or before October 1 of each year that contains a summary of all activities conducted by the Arizona board of regents and community college districts relating to competitive government activities. The office may require oral or written status reports relating to competitive government activities from the state agencies as deemed necessary.

§ 41-2773 Powers and duties of the office of management and budget relating to competitive government

In addition to the duties assigned by the governor, the office:

Shall develop, implement and manage a statewide competitive government program.
Shall identify, with the assistance of state agencies, functions in state government appropriate for submittal to the competitive government process.
May require a state agency to conduct an in-house total cost estimate, a management study or any hearing, study, review or cost estimate concerning any aspect of a target function to determine the potential for privatization.
May require a state agency to release a request for proposal or invitation to bid for any target function the office deems appropriate for competitively contracting.
Shall develop minimum savings criteria for governing the award of contracts resulting from the competitive government process.
Shall develop a costing model that accurately estimates and accounts for the total cost of providing a state function and develop methods by which state in-house costs can be compared to private sector costs. The model shall:

(a) Take into account relevant costs for determining whether savings would result from the privatization of a target function.

(b) Specifically account for conversion, transaction, disruption, contract monitoring costs, and revenue increases and decreases related to a privatization.

Shall develop a handbook and training program that educates state agencies in the competitive government process.
Shall preapprove requests for proposals and invitations to bid, as the office deems appropriate, that could result in the privatization or transfer to another state agency of a target function.

Chapter 26 Department of Juvenile Corrections

Article 1 Organization of Department of Juvenile Corrections

§ 41-2801 Definitions

In this chapter, unless the context otherwise requires:

"Committed youth" or "youth" means a person who has been committed according to law to the department of juvenile corrections for supervision, rehabilitation, treatment and education and who is either:

(a) At least fourteen years of age and under eighteen years of age.

(b) Subject to retained jurisdiction pursuant to section 8-202, subsection H.

"Department" means the department of juvenile corrections.
"Director" means the director of the department of juvenile corrections.
"Educational system" means the state educational system for committed youth.
"Secure care" means confinement in a facility that is completely surrounded by a locked and physically secure barrier with restricted ingress and egress.

§ 41-2802 Department of juvenile corrections

A. A department of juvenile corrections is established.

B. The department shall have as its purpose the supervision, rehabilitation, treatment and education of all committed youth.

§ 41-2803 Director; appointment; qualifications; compensation

A. The director of the department shall be appointed by the governor pursuant to section 38-211 and shall serve at the pleasure of the governor.

B. The director, as minimum qualifications, shall have administrative experience in youth rehabilitative and treatment programs and educational qualifications and training which enable the director to manage the department in a manner consistent with the mission and purpose of the department.

C. The compensation of the director shall be as determined pursuant to section 38-611.

§ 41-2804 Duties and powers of director

A. The director shall:

Be responsible for the overall operations and policies of the department.
Maintain and administer all secure care facilities and programs within the department required and established for the custody, control, treatment, education and rehabilitation of all youths committed to the department.
Be responsible for the administration and execution of all conditional liberty services for youths released pursuant to rules adopted by the director in accordance with law.
Be responsible for the development of policies and programs which shall be recommended to the governor and the legislature for the purpose of improving the youth rehabilitative and treatment programs of this state.
Develop and establish a uniform statewide method of reporting statistics as related to this chapter.
Subject to chapter 4, article 4 of this title, employ deputy directors and other key personnel based on qualifications prescribed by the director that require education and practical experience.

B. The director may:

Adopt rules to implement the purposes of the department and the duties and powers of the director.
Take any administrative action to improve the efficiency of the department, including the following:

(a) Create new divisions or units or consolidate divisions or units.

(b) Subject to chapter 4, article 4 of this title, transfer employees between the various divisions and units of the department.

(d) Delegate authority to appoint, hire, terminate and discipline all personnel of the department, including specialists and consultants subject to chapter 4, article 4 and, as applicable, article 5 of this title.

(e) Transfer committed youths between secure care facilities.

(f) Transfer youths who have been committed to the department or to any facility under its jurisdiction between the various secure care facilities for youths, foster homes and public and private agencies on notification to the committing court.

(g) Subject to chapter 4, article 4 and, as applicable, article 5 of this title, appoint certain employees of the department to peace officer status for purposes of guarding, transporting or pursuing persons under the jurisdiction of the department and appoint certain employees of the department to peace officer status for purposes of investigating or arresting persons who commit or attempt to commit offenses directly relating to the operations of the department.

Contract with other agencies or institutions in furtherance of any department program.
Authorize the temporary escort of a youth for compassionate leave or for the purposes of treatment, education or rehabilitation. The director shall consider the public safety and any other relevant factors before approving the temporary escort of a youth. Department staff shall escort and maintain custody of a youth authorized for temporary escort.
Adopt guidelines to dispose of property that is no longer needed or necessary for use in a department educational, vocational, treatment, training or work program. The disposition of property is exempt from chapter 23, article 8 of this title.
Accept and spend private grants of monies to effectuate the purposes of section 41-2827.

C. Peace officers of the department shall not preempt the authority and jurisdiction of established agencies of this state and political subdivisions of this state. Such officers shall notify agencies of this state and political subdivisions of this state before conducting an investigation within the jurisdiction of the agency and before making an arrest within the jurisdiction of the agency and shall ask, except in an emergency, if the agency wishes to participate, perform the investigation or arrest the person to be arrested before proceeding. Personnel appointed as peace officers by the director shall have the minimum qualifications established for peace officers pursuant to section 41-1822. Personnel appointed by the director pursuant to subsection B, paragraph 2, subdivision (g) of this section are not eligible to participate in the public safety personnel retirement system except as otherwise provided in title 38, chapter 5, article 4.

§ 41-2804.01 Religious services advisory committee; appointment; duties; religious programs

A. The director shall establish a religious services advisory committee to consist of nine members, no fewer than six of whom shall be representatives of the religious community.

B. The director shall appoint the committee members, who shall serve at the director's pleasure. The chaplains employed by the department and the members of the religious services advisory committee shall make recommendations regarding appointments to the committee. Committee members shall not receive compensation.

C. The religious services advisory committee shall meet at least quarterly and shall submit quarterly progress reports and recommendations to the director.

D. The religious services advisory committee shall advise the director regarding the provision of religious programs to all youth in secure care facilities who desire the services.

E. The department shall make available religious programs that accommodate the religious faiths held by youth in secure care facilities as long as the programs would not interfere with the safety or security of the facility, staff or youth.

F. Participation in religious programs shall be available to all youth in secure care facilities. Participation in religious programs by committed youth shall be strictly voluntary. No youth shall be coerced to participate in religious programs nor shall any effort be made to coerce any youth to adopt or change any religious affiliation or beliefs.

§ 41-2805 Health care

A. The director may provide medical, dental and health services for committed youth. The director may contract for professional services to assist the director in carrying out the responsibility on behalf of this state if all of the records in connection with the services are made and retained by authorized or qualified medical and professional personnel and not by any youth. The records when not in use shall be retained in a safe and secure place.

B. If a committed youth who is not residing with the youth's parent or legal guardian is in need of medical, surgical or dental care, and a spouse, adult next of kin or legal guardian is not immediately available or has not previously given authorization for such care, the director or the director's authorized representative, on the recommendation of the attending physician or dentist, may authorize the performance of such necessary medical, surgical or dental service.

§ 41-2806 Committed youth canteen; establishment; prices; goods; insurance

A. The department may establish and maintain a committed youth canteen at any secure care facility. The committed youth canteens may offer for sale, at prices fixed by the director, toilet articles, candy, notions and other sundries for consumption on the premises. The department may provide the facilities, personnel and merchandise necessary to operate the committed youth canteens. All profit from the committed youth canteens shall be deposited in the department of juvenile corrections fund established by section 41-2810.

B. The department may purchase insurance against the damage or loss of committed youth canteen materials, supplies and equipment.

§ 41-2807 Medical services; rate structure

If a youth in a secure care facility requires health care services that the department, the facility or a provider contracted by the department cannot provide, the department shall pay approved claims from a facility or provider that provides these services as follows:

For inpatient and outpatient hospital services, the department shall reimburse at a level that does not exceed the reimbursement methodology established pursuant to section 36-2903.01, subsection G, unless the department has a contract with the vendor.
For health and medical services, the department shall reimburse at a level that does not exceed the capped fee-for-service schedule that is adopted by the Arizona health care cost containment system administration pursuant to title 36, chapter 29, article 1 and that is in effect at the time the services are delivered.

§ 41-2809 Investment of committed youths' monies; deposit of proceeds; commingling permitted

The director may deposit any youth's monies in the director's possession in a separate account of the department of juvenile corrections fund established by section 41-2810 or, subject to the approval of the state treasurer, deposit such monies in interest bearing bank accounts. On notice from the director, youths' monies deposited in the juvenile corrections fund shall be invested pursuant to section 35-313. Any proceeds from investments or deposits shall be credited to the department of juvenile corrections youths' account.

§ 41-2810 Power to accept and expend gifts; department of juvenile corrections fund

The department may accept and expend federal monies or private grants of monies, gifts and devises and may accept, manage or dispose of property to effectuate the purposes of this chapter. These monies and other monies received pursuant to this article except as otherwise provided shall be deposited, pursuant to sections 35-146 and 35-147, in a department of juvenile corrections fund and shall be expended on warrants drawn by the department of administration on order of the director of the department of juvenile corrections. Any unexpended monies do not revert to the general fund at the close of the fiscal year.

§ 41-2811 Number of divisions or units

The department shall consist of such number of divisions or units as may be established by the director. Each division or unit shall be under the supervision of a person appointed by the director.

§ 41-2812 Collection of maintenance for committed youth

A. When a youth is committed by the proper court to the department or to any facility under its jurisdiction, and an order is made by the proper court concerning the charges, expenses and maintenance payable by the committed youth or the youth's estate, parent or guardian, the director shall acknowledge receipt of the money received to the person concerned and shall deposit the money received in the department of juvenile corrections restitution fund established by section 41-2826 for the purpose of funding work restitution programs for juveniles.

B. When a youth is committed by the proper court to the department or to any facility under its jurisdiction, at the request of the parent or guardian, the charges, expenses and maintenance of the youth while in such custody, and the youth's transportation to a secure care facility, shall be paid by the parent or guardian unless the court or the department, for good cause shown, otherwise orders, in which case transportation shall be paid by the county where the commitment issues and the charges, expenses and maintenance, in whole or in part, shall be paid by this state. The department, on receipt of any payment, shall follow the procedure in subsection A of this section.

C. The director shall institute proceedings for the collection of delinquent payments to the department in the proper court on petition and notice to the party concerned.

D. When a youth is committed by the court to the department and ordered to pay a fee of not less than fifty dollars each month for the supervision of the committed youth, the parent or guardian of the youth may pay the fee directly to the department for deposit into the department of juvenile corrections restitution fund.

§ 41-2813 Agreements with federal or private agencies and institutions; contract review

A. The department may enter into agreements with the federal government, other states or their agencies for such compensation on which they agree to accept or deliver committed youth or to administer rehabilitative programs. Notwithstanding section 35-193, any monies received by the department under such agreements shall be kept in a separate revolving fund for current usage and do not revert to the state general fund if unexpended at the close of a fiscal year.

B. The department may contract with private or public institutions within and without this state possessing adequate supervision and facilities for provision of any of the following services for committed youth:

Detention.
Secure care.
Education.
Employment.
Treatment.
Rehabilitation.
Conservation camps.
Work programs.

The following criteria will be reviewed prior to a proposer being considered for award of a contract:

(a) The qualifications, operations and management experience and experienced personnel that are necessary to carry out the terms of the contract.

(b) The ability to comply with any applicable standards and specifications that the department defines and any specific court order, if required.

The contractor shall carry liability insurance in an amount that is approved by the risk management section of the department of administration and shall file proof of the insurance with the risk management section.
The contractor shall provide audited financial statements for the previous five years, or if the contractor has been in operation for less than five years, for each of the years the contractor has been in operation, and shall provide other financial information that is requested by the department.
No contract for services may authorize, allow or imply a delegation of authority or responsibility to a contractor for any of the following:

(a) Granting conditional liberty.

(b) Establishing length of stay guidelines.

(d) Granting absolute discharge.

D. When a youth is committed, the clerk of the committing court shall file with the department a certified copy of the order of the court, with a sufficient transcript of the record to inform the department of the material facts of the case.

§ 41-2814 Fingerprinting; direct contact with committed youth; exception; violation; classification; definitions

A. Each employee of the department and any licensee or contract service provider, employee of any licensee or contract service provider and each volunteer who has unsupervised direct contact with committed youth inside a secure care facility under the jurisdiction of the department shall be fingerprinted and is subject to a criminal history records check pursuant to section 41-1750, subsection G, paragraph 1. These individuals shall submit fingerprints and the form prescribed in subsection G of this section within ten days before the date of unsupervised direct contact with committed youth. Unsupervised direct contact with committed youth inside a secure care facility under the jurisdiction of the department is conditioned on the results of the fingerprint check.

B. Each employee of a licensee or contract service provider, each contractor and licensee, and each volunteer who has supervised direct contact with committed youth inside a secure care facility under the jurisdiction of the department is subject to a criminal history records check pursuant to section 41-1750, subsection G, paragraph 16. A visitor who has supervised direct contact with committed youth inside a secure care facility under the jurisdiction of the department is subject to a criminal history records check pursuant to section 41-1750, subsection G, paragraph 16. A person's entry into a secure care facility under the jurisdiction of the department is conditioned on the results of the criminal history records check pursuant to this subsection.

C. Except as provided in subsection A of this section, a paid or unpaid employee of a licensee or contract service provider who has direct contact with committed youth outside of a secure care facility shall submit the form prescribed in subsection G of this section and have a valid fingerprint clearance card issued pursuant to chapter 12, article 3.1 of this title or shall apply for a fingerprint clearance card within seven days after beginning employment. Direct contact with committed youth pursuant to this subsection is conditioned on the results of the fingerprint and criminal history records check pursuant to section 41-1750, subsection G, paragraphs 1 and 16.

D. A service contract or license with any contract service provider or licensee is subject to immediate cancellation or termination if a paid or unpaid employee of the contract service provider or licensee who has direct contact with committed youth meets either of the following:

Certifies pursuant to subsection G of this section that the individual is awaiting trial on or has been convicted of or has attempted or committed any of the offenses listed in subsection G of this section in this jurisdiction or acts committed in another jurisdiction that would be offenses in this jurisdiction.
Is required to possess a valid fingerprint clearance card pursuant to subsection C of this section and does not possess or is denied issuance of a valid fingerprint clearance card.

E. A contract service provider or licensee may avoid cancellation or termination of the contract or license under subsection D of this section if an individual who does not possess or has been denied issuance of a valid fingerprint clearance card as required by subsection C of this section or who certifies pursuant to subsection G of this section that the individual has been convicted of or is awaiting trial on or has attempted or committed any of the offenses listed in subsection G, paragraphs 1, 2, 3, 6, 7, 9, 15, 16, 17, 18 and 21 of this section is immediately prohibited from employment or service with the contract service provider or licensee in any capacity requiring or allowing direct contact with committed youth.

F. A contract service provider or licensee may avoid cancellation or termination of the contract or license under subsection D of this section if an individual who does not possess or has been denied issuance of a valid fingerprint clearance card as required by subsection C of this section or who certifies pursuant to subsection G of this section that the individual has been convicted of or is awaiting trial on or has attempted or committed any of the offenses listed in subsection G, paragraphs 4, 5, 8, 10, 11, 12, 13, 14, 19, 20, 22 and 23 of this section is immediately prohibited from employment or service with the contract service provider or licensee in any capacity requiring or allowing direct contact with committed youth, unless the person is granted a good cause exception pursuant to section 41-619.55.

G. Each individual who is listed in subsections A and B of this section and who has direct contact with committed youth and each individual who is listed in subsection C of this section shall certify on forms provided by the department whether the individual is awaiting trial on or has ever been convicted of or has attempted or committed any of the following criminal offenses in this state or similar offenses in another state or jurisdiction:

Sexual abuse or sexual harassment of a minor.
Incest.
First or second degree murder.
Kidnapping.
Arson.
Sexual assault.
Sexual exploitation of a minor.
Contributing to the delinquency of a minor.
Commercial sexual exploitation of a minor.
Any offense involving sale, distribution or transportation of, offer to sell, transport or distribute or conspiracy to sell, transport or distribute marijuana, dangerous drugs or narcotic drugs.
Any offense involving the possession or use of marijuana, dangerous drugs or narcotic drugs.
Burglary.
Aggravated or armed robbery.
Robbery.
A dangerous crime against children as defined in section 13-705.
Child abuse.
Sexual conduct with a minor.
Molestation of a child.
Manslaughter.
Assault or aggravated assault.
Exploitation of minors involving drug offenses.
A violation of section 28-1381, 28-1382 or 28-1383.
Any offense involving domestic violence.

H. The department shall make documented, good faith efforts to contact previous employers of personnel to obtain information or recommendations that may be relevant to an individual's fitness for employment.

I. Hospital employees, licensed medical personnel, staff and volunteers who provide services to juveniles in a health care facility located outside the secure care facility and who are under the direct visual supervision as is medically reasonable of the department's employees or the department's contracted security employees are exempt from the requirements of this section.

J. Except as provided in this subsection, the department may not allow an individual who is listed in subsections A, B and C of this section and who is awaiting trial on or who has committed, attempted or been convicted of a felony offense pursuant to subsection G of this section to have supervised or unsupervised direct contact with committed youth. Notwithstanding subsections A, B, C, and D of this section, the director may allow an individual who is listed in subsections A, B and C of this section and who has been convicted of an offense listed in subsection G, paragraph 5, 10, 11, 12, 13, 14, 19, 20, 22 or 23 of this section to have supervised direct contact with committed youth if the director finds that the individual is successfully rehabilitated. In determining whether an individual is successfully rehabilitated, the director:

May require the individual to disclose evidence regarding substantiated allegations of neglect or child or vulnerable adult abuse pursuant to section 13-3623.
Shall consider all of the following:

(a) The extent of the individual's criminal record.

(b) The length of time that has elapsed since the offense was committed.

(d) Any applicable mitigating circumstances.

(e) The extent of the individual's rehabilitation, including:

(i) The completion of probation, parole or community supervision.

(ii) Whether the individual paid restitution or any other compensation for the offense.

(iii) Any evidence of positive action to change criminal behavior, including completion of a drug treatment program or counseling.

(iv) Any personal references attesting to the individual's rehabilitation.

K. The department of juvenile corrections shall notify the department of public safety if the department of juvenile corrections receives credible evidence that an individual who possesses a valid fingerprint clearance card either:

Is arrested for or charged with an offense listed in section 41-1758.03, subsection B.
Falsified information on the form required by subsection G of this section.

L. An individual who makes a false statement, representation or certification in an application for employment with the department is guilty of a class 3 misdemeanor.

M. For the purposes of this section:

"Direct contact" means supervised or unsupervised contact with committed youth.
"Employee" means paid and unpaid personnel who have direct contact with committed youth.
"Supervised" means in the presence of a department employee.
"Unsupervised" means outside the presence of a department employee.

§ 41-2815 Individual treatment plan; diagnostic assessment; placement

A. The department shall develop for each committed youth an individual treatment plan based on a diagnostic psychological evaluation and educational assessment received from the court pursuant to section 8-341 or performed by the department. The individual treatment plan shall take into consideration the public safety and other factors that are relevant to the youth's treatment, rehabilitation and education.

B. The diagnostic assessment that is required by subsection A of this section shall be conducted under the supervision of a psychologist licensed pursuant to title 32, chapter 19.1. The written evaluation shall include:

The reason for the referral.
Relevant medical findings.
A description of the tests and screening devices that are administered and the results.
An assessment of the youth's intellectual functioning and levels of achievement, including a neuropsychological screening and, if applicable, a diagnostic statistical manual-IIIR diagnosis and psychoeducational diagnosis.
The developmental, social and educational histories of the youth.
An analysis of the youth's problematic behavior, including a description of the behavior, its frequency and duration, any aggravating or mitigating circumstances and the likelihood that the problematic behavior will recur, and an analysis of related factors.
An assessment of the youth's family system, including the ability of the family to supervise the youth and support positive behavior in the youth. The evaluation may recommend the types of services needed to strengthen the family's ability to supervise and support the youth.
An assessment of the youth's strengths and skills especially those related to changing the problematic behavior.
Specific recommendations regarding the level and type of services and supervision that would address the youth's problematic behavior and educational deficiencies, if any.

C. Based on the youth's individual treatment plan, the department shall assign each committed youth to an appropriate educational program in a secure care facility or other placement. The department shall establish or contract for secure care facilities and residential and nonresidential community placements and programs.

§ 41-2816 Secure care facilities; rehabilitative services; length of stay guidelines

A. The department shall operate and maintain or contract for secure care facilities for the custody, treatment, rehabilitation and education of youth who pose a threat to public safety, who have engaged in a pattern of conduct characterized by persistent and delinquent offenses that, as demonstrated through the use of other alternatives, cannot be controlled in a less secure setting or who have had their conditional liberty revoked pursuant to section 41-2819.

B. Each youth who is placed in a secure care facility shall receive rehabilitative services appropriate to the youth's age, needs and abilities, including education, counseling, mental health services, recreation and vocational training.

C. The department in cooperation with the juvenile court shall develop length of stay guidelines that are consistent with both treatment and public safety considerations. The department in cooperation with the juvenile court shall annually review the length of stay guidelines. Each youth who is placed in a secure care facility shall be assigned a length of stay pursuant to the length of stay guidelines. The length of stay shall set forth minimum and maximum review dates.

§ 41-2817 Community based care

A. The department shall establish and operate or contract for the operation of a system of community based programs to supervise and rehabilitate youth in the least restrictive environment consistent with public safety and the needs of the youth. The programs shall consist of both residential and nonresidential nonsecure treatment centers.

B. Before incurring any obligation for the establishment of a community based residential treatment center, the department shall give at least sixty days' written notice to the city, town and school district affected and to the county board of supervisors for an unincorporated area. The county, city, town or school district may contest establishment of a community based residential treatment center by written objection filed with the department within thirty days after receiving notice and may request a hearing to be conducted by the department pursuant to chapter 6, article 6 of this title.

§ 41-2818 Conditional liberty; notification; consent

A. After a determination by the department that a youth is not likely to be a threat to the public safety if released and that the youth's continued treatment, rehabilitation and education in a less restrictive setting are consistent with the public's safety and interest, the youth may be granted conditional liberty and placed under the care of the youth's parent or legal guardian or a resident of this state of good moral character or placed in a community based treatment center.

B. Each youth who is placed on conditional liberty is subject to the conditions imposed by the department, including an assignment to an educational program. When conditional liberty is granted, the youth shall receive and sign a copy of the terms of conditional liberty.

C. The department shall notify the committing court and the county attorney in the county in which the youth was committed twenty days before granting conditional liberty. The department shall consider the recommendation of the court, the county attorney and the victim, if any, before granting conditional liberty.

D. If the department grants conditional liberty, the department shall provide the court and county attorney with a copy of the youth's terms of conditional liberty. If the youth was adjudicated for an offense involving the purchase, possession or consumption of spirituous liquor or a violation of title 13, chapter 34, the department may require the juvenile to:

Complete alcohol or other drug screening, education or treatment that is licensed through the department of health services.
Submit to random drug and alcohol testing at least two times per week as a condition of the youth's conditional liberty.

E. Notwithstanding any other law, the department's consent to place a youth in a community based residential treatment center constitutes the consent necessary for the placement of the youth pursuant to this section.

§ 41-2819 Revocation of conditional liberty; suspension

A. The department may revoke conditional liberty granted under section 41-2818 if the department determines that the youth has violated one or more terms of conditional liberty and that the youth's return to or placement in a secure care facility is in the best interests of the public.

B. The department shall establish procedures for the revocation and suspension of conditional liberty.

C. If the director or an officer designated by the director has reasonable cause to believe that a youth who has been granted conditional liberty has violated a term of conditional liberty, the officer may issue a citation that requires the youth to appear at a conditional liberty revocation proceeding or may issue a warrant for the apprehension of the youth.

D. A youth may be apprehended and returned to a secure care facility by a law enforcement agency or an officer designated by the director if the agency or officer:

Has a warrant for the apprehension of the youth.
Has probable cause to believe that a warrant has been issued for the apprehension or arrest of the youth.
Has probable cause to believe that the youth has committed a violation of law.

§ 41-2820 Discharge

A. Each youth shall be discharged from the jurisdiction of the department on attaining eighteen years of age, except that if the juvenile court retained jurisdiction over the youth pursuant to section 8-202, subsection H, the youth shall be discharged from the jurisdiction of the department on or before attaining nineteen years of age.

B. If the department determines that the youth's treatment, rehabilitation and education pursuant to the individual treatment plan have been successfully completed and that there is a reasonable probability that the youth will observe the law and will not be a threat to the public's safety if at liberty, the youth may be granted a discharge. On the discharge of a youth pursuant to this subsection, the department shall promptly notify the committing court, the county attorney in the county in which the youth was committed and the victim or the victim's representative of the discharge.

C. Except as provided in subsection D of this section, a youth shall be discharged from the jurisdiction of the department of juvenile corrections if the youth is convicted of a felony offense.

D. A youth who is convicted of a felony offense and who committed the offense while residing in a secure care facility operated by the department of juvenile corrections either:

Shall be discharged from the department of juvenile corrections if the youth is sentenced to the state department of corrections.
May be discharged from the department of juvenile corrections if the youth is placed on adult probation and all the following apply:

(a) The youth has completed the minimum length of stay in secure care, if any, that was assigned by the committing juvenile court pursuant to section 8-341.

(b) The youth would have been eligible to be placed on conditional liberty pursuant to section 41-2818.

E. A youth may be discharged from the jurisdiction of the department if the youth is placed by civil commitment under the jurisdiction of another agency.

F. A youth shall be conditionally discharged from the jurisdiction of the department if all of the following requirements are satisfied:

The youth has completed the minimum length of stay in a secure care facility, if any, that was assigned by the committing juvenile court pursuant to section 8-341.
The United States immigration and customs enforcement enforces a detainer by taking custody of the youth for immigration proceedings.
The youth signs a condition that the youth's discharge will be vacated if the youth returns to the United States without legal authorization.

G. If the department receives actual notice that a youth who received a discharge pursuant to this section has returned to the United States without legal authorization prior to the youth's attaining eighteen years of age, the department shall:

Vacate the discharge.
Place the youth on conditional liberty status.
Issue a warrant for the apprehension of the youth.
Notify the United States immigration and customs enforcement.
Take the youth into custody.

H. Notwithstanding subsection A of this section, a youth who is at least eighteen years of age shall be discharged from the jurisdiction of the department if the jurisdiction over the youth has been retained pursuant to section 8-202, subsection H and the youth is charged with a criminal offense.

§ 41-2821 Treatment of mentally ill youth and youth with developmental disabilities

A. The department of juvenile corrections and the department of health services shall develop an intergovernmental agreement to define their respective roles in providing services to mentally ill youth who are committed to the department of juvenile corrections. The agreement shall designate specific procedures for providing services to committed youth and shall provide a means of sharing funding, expertise and training opportunities. Each department shall adopt rules to implement the agreement.

B. The department of juvenile corrections and the department of economic security shall develop an intergovernmental agreement to define their respective roles in providing services to youth with developmental disabilities who are committed to the department of juvenile corrections. The agreement shall designate specific procedures for providing services to committed youth and shall provide a means of sharing funding, expertise and training opportunities. Each department shall adopt rules to implement the agreement.

§ 41-2822 Committed youth work program

A. The director shall establish a committed youth work program for youths in secure care facilities and on conditional liberty to ensure that:

All committed youths in a secure care facility receive work assignments commensurate and compatible with the condition and limitations of the youth's physical and mental health.
Committed youths on conditional liberty, as a condition of liberty, may receive work assignments. All work assignments shall be commensurate and compatible with the condition and limitations of the youth's physical and mental health.
No committed youth in a secure care facility or on conditional liberty participates in a work assignment that threatens the safety and security of the public, a secure care facility or the committed youth.

B. A committed youth may be exempted from the work requirement if the staff determines that the exemption is necessary for the health, safety or treatment of the youth. The director or the director's authorized designee shall review and approve each exemption of a committed youth from engaging in the work requirements of this section.

C. Notwithstanding title 23, chapter 2, article 3 relating to youth employment, each youth who is under commitment to the department, who is confined in a secure care facility under the department's jurisdiction and who is not regularly attending and making satisfactory progress in educational classes shall engage in work for at least forty hours a week unless exempted pursuant to subsection B of this section.

D. Each committed youth who is engaged in productive work while under the jurisdiction of the department may receive such compensation for the youth's work as the director determines. The compensation shall be in accordance with a graduated schedule based on quality and quantity of work performed and skill required for its performance.

E. The compensation of committed youths shall be paid directly by an outside entity or monies appropriated by the legislature or by the department with monies from the department of juvenile corrections restitution fund established by section 41-2826.

F. A minimum of two-thirds of any compensation earned pursuant to this section by a committed youth in a secure care facility shall be paid to the clerk of the superior court to satisfy any juvenile court restitution order made pursuant to section 8-344. While a youth is on conditional liberty, the department shall determine the amount of wages to be credited to restitution.

G. The department shall require the payment of court-ordered restitution, monetary reimbursements or assessments as a term of conditional liberty.

H. With the approval of the juvenile court and the victim, community restitution hours may be substituted for monetary restitution or monetary assessments at a rate deemed reasonable by the department.

I. The department may enter into contracts with this state, any political subdivision of this state or private entities in order to provide employment or vocational educational experience.

§ 41-2822.01 Education requirement for committed youth

A. A committed youth who is confined in a secure care facility and who has not received a high school diploma, a high school certificate of equivalency or an exception from the director shall attend school full time and make satisfactory progress in educational classes. A committed youth who is confined in a secure care facility and who has achieved a high school diploma or a high school certificate of equivalency may attend or participate in regular classes or the educational programming established or provided by the department as the department deems appropriate.

B. If a committed youth regularly attends and is making satisfactory progress in educational classes as prescribed in this section, the committed youth shall be required to work at least twenty hours a week with up to ten hours of homework a week counting toward this requirement.

C. Notwithstanding subsection A of this section, a committed youth who is at least sixteen years of age, has not received a high school diploma, a high school certificate of equivalency or an exception from the director and who is functionally literate may take the general equivalency diploma test or an equivalency test approved by the state board of education prior to release from a secure care facility. The committed youth may be required to demonstrate readiness for the general equivalency diploma test through an assessment or by completion of a practice test in order to request administration of the general equivalency diploma test or an equivalency test approved by the state board of education.

§ 41-2823 Escape of youth committed to department; aiding in escape; violation; classification

A. It is unlawful for a youth who is committed to the department by the superior court and who is confined in any state secure care facility under the jurisdiction of the department or any other secure care facility in which such youth are confined under contractual agreement with the department to escape from such facility or from the lawful custody of any law enforcement officer or an employee of the department.

B. The officers and employees of the department have the powers and privileges of peace officers as far as necessary to arrest committed youth who have escaped from any secure care facility, as provided in subsection A. On verbal or written request of the director or the director's designee, any peace officer shall apprehend or take into custody, without the necessity of a warrant or court order, an escaped committed youth and deliver the committed youth to the custody of the department immediately.

C. A person who knowingly permits or aids a committed youth confined to a state institution or facility as provided in subsection A to escape or conceals any committed youth with the intent of enabling that offender to elude pursuit is guilty of a class 6 felony.

§ 41-2824 Training institute

A. A training institute is established within the department of juvenile corrections to train those persons who work with committed youth in juvenile justice.

B. The director shall establish and maintain training institutes under the jurisdiction of the department.

C. The director may:

Employ personnel and any faculty necessary to operate the training institute.
Solicit, accept and expend gifts and grants.
Adopt training standards.
Approve the training curriculum, including continuing education and advanced and specialized training courses.
Issue a certificate of completion to a person who satisfactorily completes a training program of not less than two hundred forty hours.

D. A postsecondary institution may provide the training courses the director may approve under subsection C, paragraph 4 of this section.

E. The director shall adopt rules for reimbursing reasonable tuition and fees for employees who attend the training institute. If an agency other than the department sends an employee to the training institute, the agency shall pay all of its employee's tuition and fees.

§ 41-2825 Community work program

A. A community work program is established under the jurisdiction of the department.

B. The director may place a person granted conditional liberty in the community work program under the direction of the department.

C. The community work program shall involve community restitution programs, including graffiti abatement, park maintenance and other community restitution activities.

D. The department may credit a youth for community restitution pursuant to section 41-2826 at a rate deemed reasonable by the director. Monies credited to the youth under this subsection may only be used to satisfy restitution or court ordered monetary assessments.

§ 41-2826 Department of juvenile corrections restitution fund

A. The department of juvenile corrections restitution fund is established for the payment of restitution and monetary assessments by youths who are ordered to pay restitution or monetary assessments and who are financially unable to pay or who are otherwise unable to be employed to earn money to pay restitution or monetary assessments and who are working in the committed youth work program prescribed by section 41-2822 or the community work program established by section 41-2825. The fund consists of federal, state and local appropriations and grants, gifts, devises and donations from any public or private source. The fund shall be used to pay a youth for the youth's work in the committed youth work program prescribed by section 41-2822 and to provide monies for the community work program established by section 41-2825.

B. The director may direct the payment of monies from the fund to the victim or the court for community restitution activities the youth does to pay restitution or monetary assessments that were ordered by the juvenile court or that the youth agreed to pay as part of a community work program administered by the department. If a youth performs community restitution pursuant to this subsection, the entity providing the work shall supervise the youth's work. The youth shall be credited for each hour worked at an hourly rate set by the director.

C. As monies are available, the department shall pay from the fund youths who perform work or community restitution activities for restitution and monetary assessments purposes.

D. The department may expend, for the payment of administrative costs and expenses, an amount not greater than ten percent of the fund balance as of the end of the preceding fiscal year.

E. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-2827 Products produced by committed youths; materials; disaffirmance; contracts

A. Products that are produced by committed youths pursuant to an educational, vocational, treatment, training or work program are the property of the department and may be marketed to the public by the department.

B. The department may purchase raw materials, components and supplies for use in the manufacture of products in a department educational, vocational, treatment, training or work program.

C. The department shall fix and determine the prices at which all articles, services or products that are manufactured, provided or produced shall be furnished or sold. All articles or products that are manufactured or produced or services that are provided through department educational, vocational, treatment, training or work programs shall be priced at not less than the actual cost of producing and marketing the product plus a reasonable amount for overhead and administrative costs and a reasonable profit to provide fiscal resources for the research and development of programs for committed youths.

D. Sales of products that are produced by committed youths pursuant to a department educational, vocational, treatment, training or work program are not subject to disaffirmance because of minority.

E. The director or the director's designee may contract with any state agency, political subdivision or private person, firm, corporation or association to provide services or products produced by committed youths pursuant to an educational, vocational, treatment, training or work program.

§ 41-2831 State educational system for committed youth; report

A. The director shall establish a state educational system for committed youth for the common and high school education of committed youth.

B. The director shall identify three persons who are qualified to serve as superintendent of the state educational system for committed youth. The director and the superintendent of public instruction shall agree on one of the three persons whom the director shall employ as superintendent to manage the educational system. The superintendent of the educational system shall employ teachers and other personnel as needed in accordance with chapter 4, article 4 of this title, subject to the approval of the director. All persons who are employed to work in the educational system including the superintendent shall hold the appropriate certificate prescribed by the state board of education in section 15-203, subsection A, paragraph 14.

C. The director shall cause to be implemented the course of study for youth who are enrolled in the state educational system for committed youth.

D. The director shall consider the inclusion of factors related to a pupil's academic progress and standards of behavior as part of the length of stay guidelines adopted as prescribed in section 41-2816.

E. The state educational system for committed youth shall provide appropriate education to all committed youth as required by state and federal law. If not otherwise required by law, the educational system shall provide an appropriate education to all committed youth who have not received a high school diploma or a high school certificate of equivalency.

F. On entrance of a youth to the state educational system for committed youth, the educational system shall administer a basic skills examination to the youth to determine the educational needs of the youth. A similar examination shall be administered on the youth's exit from the educational system to assess the youth's progress while enrolled in the educational system.

G. The department is entitled to receive equalization assistance for the costs of the state educational system for committed youth as provided in title 15, chapter 11.1.

H. The superintendent shall:

Keep records and provide information as the department of education requires to determine the appropriate amount of equalization assistance.
Prepare an annual financial report containing information similar to that provided by school districts in the report prescribed in section 15-904 in a format prescribed by the department of administration in consultation with the auditor general and submit the report to the governor, the speaker of the house of representatives, the president of the senate and the department of education by November 1. When submitting the report to the speaker and president, the superintendent shall send a copy of the report to the chairmen of the house and senate education committees and shall send a notice to all other legislators that the report is available on request.
Establish a system for communicating with each youth's school district of residence in order to facilitate the transfer of records, the determination of the most appropriate educational program and the transfer of educational credit.

I. The department of administration shall develop and maintain a special pay plan for teachers and other professional educational personnel within the state educational system for committed youth. The pay plan shall attempt to keep salaries at a comparable level to that of public school district personnel.

J. Notwithstanding any law to the contrary, the director shall designate an educational program for youth on conditional liberty and, if it is in the best interests of the youth and the community, may assign a youth to a specific public or private educational program.

§ 41-2832 County contributions for committed youth in secure care facilities; county payments; excluded costs

(Rpld. 7/1/28)

A. The department shall annually assess a committed youth confinement cost sharing fee to each county with a population of more than three million persons.

B. Each county with a population of more than three million persons shall pay the monies owed within thirty days after a request by the department. If a county does not make the payment, the director shall notify the state treasurer of the amount owed and the state treasurer shall withhold the amount, including any additional interest as provided in section 42-1123, from any transaction privilege tax revenues that would otherwise be distributed to the county. The state treasurer shall deposit, pursuant to sections 35-146 and 35-147, the withholdings in the department of juvenile corrections local cost sharing fund established by section 41-2833. The department shall deposit the monies received from a county in the department of juvenile corrections local cost sharing fund established by section 41-2833.

C. County contributions made pursuant to this section are excluded from the county expenditure limitations.

D. Notwithstanding any other law, a county may meet the cost sharing requirements of this section from any source of county revenue designated by the county, including monies of any countywide special taxing jurisdiction in which the board of supervisors serves as the board of directors.

§ 41-2833 Department of juvenile corrections local cost sharing fund; use

(Rpld. 7/1/28)

A. The department of juvenile corrections local cost sharing fund is established consisting of monies collected and deposited pursuant to section 41-2832. The department shall administer the fund.

B. Monies in the fund are subject to legislative appropriation and are to be used for the operating costs of the department.

Chapter 27 Legislative Review of Agencies and Expiration of New Programs

Article 1 Legislative Review of Agencies

§ 41-2951 Purpose

A. The Arizona legislature finds that state government actions have caused an increase in the number of agencies, departments, boards, commissions, institutions and programs of this state and that the process has developed without sufficient legislative oversight. Furthermore, the legislature finds that state government should be continually reviewed and revised in response to the developing needs of the public. In addition, the legislature finds that programs are perpetuated without periodic and systematic reappraisal of their achievements as compared to their original objectives. The legislature concludes that by establishing a system for the termination, study, review, continuation or reestablishment of such agencies, it will be in a better position to evaluate the need for the continued existence of current and future agencies, departments, boards, commissions, institutions and programs of this state.

B. It is the intention of the legislature:

To establish an orderly schedule for the termination of existing state agencies, departments, boards, commissions, institutions and programs and to make provisions for legislative review to enable the legislature to have the benefit of recommendations for the continuation of those state agencies, departments, boards, commissions, institutions and programs which are deemed to be essential for the necessary and efficient operation of government.
That the sunset review of an existing state agency, department, program, board or advisory council or committee means the sunset review of the powers and duties exercised by such state agency, department, program, board or advisory council or committee.
That any amendment of the enabling authority for an agency, department, program, board or advisory council or committee subject to sunset review be in accordance with this chapter.

§ 41-2952 Definitions

In this chapter, unless the context otherwise requires:

"Agency" means any department, office, agency, commission, board or other instrumentality of this state specified in article 2 of this chapter regardless of whether monies are appropriated to such board.
"Committee" means the joint legislative audit committee.
"Committee of reference" means the appropriate standing committee of the house of representatives or senate that is appointed for the purpose of evaluating agencies subject to termination pursuant to this chapter.
"Special performance audit" means a performance audit of limited scope.
"Sunset review" means a systematic evaluation by the committee of reference under the supervision of the joint legislative audit committee, with the assistance of the appropriate agency, joint legislative budget committee, committees of reference, auditor general and support staff, to determine if the merits of the program justify its continuation rather than termination, or its continuation at a level less than or greater than the existing level. Such review shall be undertaken in the scope and detail the committee of reference deems appropriate and shall include, without limitation, whether there is a need for the program in state government and, if so, an assessment of the degree to which the original objectives of the program have been achieved expressed in terms of the performance, impact or accomplishments of the program and of the situation it was intended to address. Such review shall be coordinated with the performance audit procedures of the auditor general as set forth in chapter 7, article 10.1 of this title or of the committees of reference, whichever is appropriate.
"Terminate" or "termination" means the date provided for termination of legislative authority for the existence of a particular agency pursuant to article 2 of this chapter.

§ 41-2953 Joint legislative audit committee; sunset powers and duties; report by auditor general and committees of reference; sunset review reports; performance audits

A. The joint legislative audit committee shall designate the chairperson of each committee of reference and shall assign agencies to the respective committees of reference according to subject matter for performance review.

B. The auditor general shall provide to the joint legislative audit committee a list of agencies scheduled for termination in the next sunset termination schedule, plus an estimate of the audit hours necessary to conduct a sunset review of each agency at least twenty months before the termination date for such agencies. At least nineteen months before the termination date, the joint legislative audit committee shall meet to review the information submitted by the auditor general, shall select which agencies are subject to sunset review by the auditor general and which agencies are subject to sunset review by the committees of reference and shall determine the priority of review by the auditor general or the committees of reference, except that the Arizona criminal justice commission established by section 41-2404 is subject to sunset review by the auditor general. If the auditor general or the committees of reference are unable to complete the sunset review of a selected agency, the joint legislative audit committee shall oversee the preparation of proposed legislation to place the agency in the following sunset termination schedule and is responsible for the introduction of the legislation. Those agencies not selected for sunset review by the joint legislative audit committee shall terminate pursuant to article 2 of this chapter unless otherwise continued by the legislature.

C. The joint legislative audit committee shall initiate the sunset review at least seventeen months before the termination date for each agency that is selected pursuant to subsection B of this section and scheduled for termination pursuant to article 2 of this chapter. The draft sunset review report shall be completed at least eleven months before the date established by article 2 of this chapter for termination. Before the report is submitted, the state agency affected shall be given an opportunity to review the draft report and submit written comments or rebuttal, which shall be included in the preliminary sunset review report. The agency shall have not more than forty calendar days to review the draft report for comment or rebuttal. The preliminary sunset review report shall be submitted to the governor, to each member of the joint legislative audit committee, to the committee of reference and to the affected agency by October 1 of the year before the scheduled termination date of the agency.

D. The joint legislative audit committee may direct the auditor general or the committees of reference to conduct a performance audit as defined in section 41-1278 or a special performance audit of any agency.

E. If an agency is continued, the joint legislative audit committee may direct the auditor general or the committees of reference to conduct a follow-up review of the agency to determine how the agency has performed its statutory functions or corrected deficiencies of prior sunset review, or both.

§ 41-2954 Committees of reference; performance review reports; hearings; recommendations; subpoena powers; definitions

A. Each standing committee of both legislative houses shall constitute a committee of reference in the committee's respective subject matter areas and the committee's respective house.

B. After receipt of the preliminary sunset review report, each committee of reference or each committee of reference meeting jointly shall hold at least one public hearing when the legislature is not in session or before the third Friday in January to receive testimony from the public and from the officials of the agency involved. The agency involved shall prepare a presentation for the first public meeting that addresses the elements of the written statement required by subsection G of this section.

C. Each committee of reference shall hold public hearings for the following purposes:

To determine the actual need of the agency to regulate or direct the particular activity.
To determine the extent to which the statutory requirements of the agency are necessary and are being met.
To receive testimony from the public as to the relationship of the agency with the public.
To receive testimony from the executive director or other head of the agency as to reasons for the continuation of the agency.

D. Each committee of reference shall consider but not be limited to the following factors in determining the need for continuation or termination of each agency:

The key statutory objectives and purposes in establishing the agency.
The agency's effectiveness and efficiency in fulfilling its key statutory objectives and purposes.
The extent to which the agency's key statutory objectives and purposes duplicate the objectives and purposes of other governmental agencies or private enterprises.
The extent to which rules adopted by the agency are consistent with the legislative mandate.
The extent to which the agency has provided appropriate public access to records, meetings and rulemakings, including soliciting public input in making rules and decisions.
The extent to which the agency timely investigated and resolved complaints that are within its jurisdiction.
The extent to which the level of regulation exercised by the agency is appropriate as compared to other states or best practices, or both.
The extent to which the agency has established safeguards against possible conflicts of interest.
The extent to which changes are necessary for the agency to more efficiently and effectively fulfill its key statutory objectives and purposes or to eliminate statutory responsibilities that are no longer necessary.
The extent to which the termination of the agency would significantly affect the public health, safety or welfare.

E. Each committee of reference that reviews an agency that administers an occupational regulation shall consider but not be limited to the following factors in determining the need for continuation or termination of each agency:

The extent to which the occupational regulation meets the requirements of section 41-3502.
The extent to which failure to regulate a profession or occupation will result in:

(a) The loss of insurance.

(b) An impact to the ability to practice in other states or as required by federal law.

(d) The loss of constitutionally afforded practices.

F. The committee of reference shall deliver the final sunset review report of its recommendations to the president of the senate, the speaker of the house of representatives, the governor, the auditor general and the affected agency on or before the third Friday in January. The recommendations shall include one or more of the following:

That the state agency be continued.
That the state agency be revised or consolidated.
That the state agency be terminated pursuant to this chapter.
If the state agency administers an occupational regulation, that the legislature:

(a) Repeal the occupational or professional license.

(b) Convert the occupational or professional license to a less restrictive regulation as defined in section 41-3501.

(c) Instruct the state agency to seek legislation or adopt rules to reflect the committee of reference's recommendation to:

(i) Impose less restrictive regulations than occupational or professional licenses.

(ii) Change the requisite personal qualifications of an occupational or professional license.

(iii) Redefine the scope of practice in an occupational or professional license.

G. The final sunset review report by each committee of reference shall also include a written statement prepared by the agency involved that contains an assessment of:

The extent to which the agency potentially creates unexpected negative consequences that may require additional review by the committee of reference, including increasing the price of goods, affecting the availability of services, limiting the abilities of individuals and businesses to operate efficiently and increasing the cost of government.
The extent to which the agency has addressed deficiencies in its enabling statutes.
The extent to which the agency has determined whether the attorney general or any other agency in this state has the authority to prosecute or initiate actions.
The consequences of eliminating the agency or of consolidating it with another agency.

H. Each committee of reference shall oversee the preparation of any proposed legislation to implement the recommendations of that committee of reference and is responsible for the introduction of such legislation.

I. If an agency is continued, it is not necessary to reappoint any member of the governing board or commission of the agency. Such members are eligible to complete their original terms without reappointment or reconfirmation.

J. Each committee of reference shall have the power of legislative subpoena pursuant to chapter 7, article 4 of this title.

K. For the purposes of this section, "less restrictive regulation", "occupational or professional license" and "personal qualifications" have the same meanings prescribed in section 41-3501.

§ 41-2955 Termination of state agencies; continuation

A. All agencies shall terminate pursuant to the schedule prescribed by article 2 of this chapter, unless continued pursuant to this chapter.

B. Any agency may be continued by the legislature for a period not to exceed ten years. At the end of such period, it shall again be subject to sunset review. Any agency continued, revised or consolidated by the legislature shall contain within the enabling legislation a legislative intent section setting forth the objectives of the programs administered by the agency.

C. An agency is continued pursuant to this section if legislation to continue such agency is passed by the legislature and signed by the governor prior to the date set for termination of the agency even if the legislation to continue the agency has not become effective on the date of scheduled termination.

D. Any agency created from and after June 30, 1978 shall continue in existence for not more than ten years from the effective date of its establishment and shall be subject to this chapter.

E. Each agency created from and after June 30, 1978 shall contain a policy or purpose statement in its enabling legislation setting forth the objectives of the programs.

F. Nothing in this chapter shall be construed to prohibit the legislature from terminating any agency covered by this chapter at a date earlier than that prescribed by this chapter nor to prohibit the legislature from considering any other legislation relative to any such agency. Nothing in this chapter shall be construed to terminate the funds administered by the water infrastructure finance authority of Arizona pursuant to title 49, chapter 8.

§ 41-2956 Termination period for agencies; funds; equipment; personnel; documents; bonds

A. Any agency that is listed in article 2 of this chapter and that is terminated, within six months after its termination date, shall conclude its affairs. Termination shall not reduce or otherwise limit the powers, duties or functions of the agency. On expiration of the six-month period, the agency and its personnel positions shall be abolished.

B. Six months after the termination date of the agency, the department of administration shall transfer all funds of that agency to the state general fund. All debts of the agency shall be paid by the department of administration from the agency's funds.

C. Subject to section 41-151.21, all equipment, furniture and supplies of the terminated agency shall be transferred to the department of administration to be stored or disposed of pursuant to law.

D. All documents of the terminated agency shall be transferred to the Arizona state library, archives and public records to be stored or disposed of pursuant to law.

E. All orders, determinations, rules, permits, certificates, licenses, contracts, rates and privileges which have been issued, made, granted or allowed to become effective by an agency abolished by this chapter shall continue in effect according to their terms until the termination date of the agency.

F. Any bonds issued or sold by a state agency shall remain in full force and effect. The state shall assume bond amortization payments for any bond issuing agency abolished pursuant to this chapter.

G. If title 28 is repealed pursuant to this chapter, as long as there are any debts or other obligations payable from either the highway user revenue fund or any regional area road fund and no provision has been made for the payment or retirement of these debts or other obligations, the provisions of title 28 relating to the highway user revenue fund and any regional area road fund and the pledge of revenues from those funds and the liens on those funds to pay the debts or other obligations remain in full force and effect until the debts or other obligations have been fully paid and satisfied or provisions have been made to pay or satisfy the debts or obligations.

§ 41-2957 Claims

This chapter shall not affect the right to institute or prosecute any claim by or against an agency of this state terminated pursuant to this chapter if the claim accrued prior to the date the agency was terminated. Any claim pending on the date the agency is terminated, or instituted thereafter for actions prior to the termination date, shall be prosecuted or defended in the name of the state by the department of law.

§ 41-2958 Modified audits of certain agencies

At least every ten years the joint legislative audit committee shall conduct a review of the following agencies and programs according to the following schedule using the factors that are deemed necessary and that are listed in section 41-2954, subsection D:

By July 1, 1996 for the department of education including the programs and activities administered, prescribed or regulated by the department.
By July 1, 1997 for the programs and commissions established by the legislature within the judiciary.
By July 1, 1998 for Arizona state university, Arizona state university west campus, Arizona state university east campus, the university of Arizona and northern Arizona university. For purposes of this paragraph, the committee may combine the review for all of the universities into one or more reviews and reports.

Article 2 Termination of Agencies

§ 41-2992.04 Polygraph examiners advisory board; termination July 1, 1992

A. The polygraph examiners advisory board terminates on July 1, 1992.

B. Title 32, chapter 27, article 1 is repealed on January 1, 1993.

§ 41-2992.08 Watercraft advisory council; termination July 1, 1992

A. The watercraft advisory council terminates on July 1, 1992.

B. Section 5-381 is repealed on January 1, 1993.

§ 41-2992.09 Colorado river boundary commission; termination July 1, 1992

A. The Colorado river boundary commission terminates on July 1, 1992.

B. Title 41, chapter 3, article 2 is repealed on January 1, 1993.

§ 41-2994.03 Blind and visually impaired advisory committee; termination July 1, 1994

A. The blind and visually impaired advisory committee terminates on July 1, 1994.

B. Title 46, chapter 2, article 4.1 is repealed on January 1, 1995.

§ 41-2996.14 Commission on the Arizona environment; termination July 1, 1996

A. The commission on the Arizona environment terminates on July 1, 1996.

B. Title 49, chapter 1, article 2 is repealed on January 1, 1997.

§ 41-2997.05 Advisory council on arthritis and musculoskeletal diseases; termination July 1, 1997

A. The advisory council on arthritis and musculoskeletal diseases terminates on July 1, 1997.

B. Title 41, chapter 5, article 5 is repealed on January 1, 1998.

§ 41-2997.07 Drug enforcement task force; termination July 1, 1997

A. The drug enforcement task force terminates on July 1, 1997.

B. Section 41-2406 is repealed on January 1, 1998.

§ 41-2997.12 Developmental disabilities oversight committee; termination July 1, 1997

A. The developmental disabilities oversight committee terminates on July 1, 1997.

B. Section 36-573 is repealed on January 1, 1998.

§ 41-2997.16 Apprenticeship advisory council; termination July 1, 1997

A. The apprenticeship advisory council terminates on July 1, 1997.

B. Title 23, chapter 2, article 2 is repealed on January 1, 1998.

§ 41-2998.18 Juvenile sex offenders treatment protocol panel; termination July 1, 1998

A. The juvenile sex offenders treatment protocol panel terminates on July 1, 1998.

B. Section 36-3431.01 is repealed on January 1, 1999.

§ 41-2999.04 State board for vocational and technological education; termination July 1, 1999

A. The state board for vocational and technological education terminates on July 1, 1999.

B. Section 15-781.01 is repealed on January 1, 2000.

§ 41-2999.13 Water quality advisory council; termination July 1, 1999

A. The water quality advisory council terminates on July 1, 1999.

B. Section 49-204 is repealed on January 1, 2000.

§ 41-3000.02 State educational system for committed youth board; termination July 1, 2000

A. The state educational system for committed youth board terminates on July 1, 2000.

B. Title 41, chapter 26, article 2, is repealed on January 1, 2001.

§ 41-3000.25 Communicable disease advisory council; termination July 1, 2000

A. The communicable disease advisory council terminates on July 1, 2000.

B. Section 36-136.03 is repealed on January 1, 2001.

§ 41-3002.16 Arizona advisory council on environmental education; termination July 1, 2002

A. The Arizona advisory council on environmental education is terminated on July 1, 2002.

B. Title 41, chapter 18 is repealed on January 1, 2003.

§ 41-3002.17 Comprehensive school health policy council; termination July 1, 2002

A. The Arizona comprehensive school health policy council terminates on July 1, 2002.

B. Title 15, chapter 1, article 7, is repealed on January 1, 2003.

§ 41-3004.18 Arizona wine commission; termination July 1, 2004

A. The Arizona wine commission terminates on July 1, 2004.

B. Title 3, chapter 3, article 6 is repealed on January 1, 2005.

§ 41-3004.20 Arizona state hospital capital construction commission; termination July 1, 2004

A. The Arizona state hospital capital construction commission terminates on July 1, 2004.

B. Section 36-218 is repealed on January 1, 2005.

§ 41-3005.07 Arizona drug and gang policy council; termination July 1, 2005

A. The Arizona drug and gang policy council terminates on July 1, 2005.

B. Section 41-617 is repealed on January 1, 2006.

§ 41-3007.02 Grazing best management practices advisory committee; termination July 1, 2007

A. The grazing best management practices advisory committee terminates on July 1, 2007.

B. Section 49-202.02, is repealed on January 1, 2008.

§ 41-3007.06 Arizona uniform plumbing code commission; termination July 1, 2007

A. The Arizona uniform plumbing code commission terminates on July 1, 2007.

B. Title 41, chapter 3, article 11 is repealed on January 1, 2008.

§ 41-3009.04 Governor's council on developmental disabilities; termination July 1, 2009

A. The governor's council on developmental disabilities terminates on July 1, 2009.

B. Title 41, chapter 22 is repealed on January 1, 2010.

§ 41-3010.08 Arizona neighborhood preservation and investment commission; termination July 1, 2010

A. The Arizona neighborhood preservation and investment commission terminates on July 1, 2010.

B. Title 41, chapter 4.3 is repealed on January 1, 2011.

§ 41-3010.15 Advocate for private property rights; termination July 1, 2010

A. The advocate for private property rights terminates on July 1, 2010.

B. Title 41, chapter 8, article 1.1 is repealed on January 1, 2011.

§ 41-3011.06 Interagency council on long-term care; termination July 1, 2011

A. The interagency council on long-term care terminates on July 1, 2011.

B. Title 41, chapter 38 is repealed on January 1, 2012.

§ 41-3011.12 Developmental disabilities oversight committee; termination July 1, 2011

A. The developmental disabilities oversight committee terminates on July 1, 2011.

B. Section 36-573 is repealed on January 1, 2012.

§ 41-3012.13 Unexplained infant death advisory council; termination July 1, 2012

A. The unexplained infant death advisory council terminates on July 1, 2012.

B. Title 36, chapter 22, article 3 is repealed on January 1, 2013.

§ 41-3012.16 Arizona state lottery commission; termination July 1, 2012

(Caution: 1998 Prop. 105 applies)

A. The Arizona state lottery commission terminates on July 1, 2012.

B. Title 5, chapter 5 is repealed on January 1, 2013.

§ 41-3012.19 State compensation fund; termination July 1, 2012

A. The state compensation fund board of directors terminates on July 1, 2012.

B. Title 23, chapter 6, article 5 is repealed on January 1, 2013.

§ 41-3014.03 Arizona state hospital advisory board; termination July 1, 2014

A. The Arizona state hospital advisory board terminates on July 1, 2014.

B. Section 36-217 is repealed on January 1, 2015.

§ 41-3014.16 Arizona public safety communications advisory commission; termination July 1, 2014

A. The Arizona public safety communications advisory commission terminates on July 1, 2014.

B. Title 41, chapter 32, article 4 is repealed on January 1, 2015.

§ 41-3015.01 Solar energy advisory council; termination July 1, 2015

A. The solar energy advisory council terminates on July 1, 2015.

B. Section 41-111 is repealed on January 1, 2016.

§ 41-3015.10 Constitutional commemoration committee; termination July 1, 2015

A. The constitutional commemoration committee terminates on July 1, 2015.

B. Title 41, chapter 3, article 10 is repealed on January 1, 2016.

§ 41-3016.04 Employment advisory council; termination July 1, 2016

A. The Arizona employment advisory council terminates on July 1, 2016.

B. Title 23, chapter 3, article 2 is repealed on January 1, 2017.

§ 41-3016.20 Election officer education, training and certification advisory committee; termination July 1, 2016

A. The election officer education, training and certification advisory committee terminates on July 1, 2016.

B. Section 16-407.01 is repealed on January 1, 2017.

§ 41-3016.23 Arizona e-learning task force; termination July 1, 2016

A. The e-learning task force terminates on July 1, 2016.

B. Section 15-1044 is repealed on January 1, 2017.

§ 41-3020.09 Mining advisory council; termination July 1, 2020

A. The mining advisory council terminates on July 1, 2020.

B. Title 41, chapter 47 is repealed on January 1, 2021.

§ 41-3024.01 Arizona resource advisory council; termination July 1, 2024

A. The Arizona resource advisory council terminates on July 1, 2024.

B. Title 37, chapter 2, article 20 is repealed on January 1, 2025.

§ 41-3024.29 Arizona health facilities authority; termination July 1, 2024

A. The Arizona health facilities authority and its governing board terminate on July 1, 2024.

B. Title 36, chapter 4.2, article 1 is repealed on January 1, 2025.

§ 41-3026.01 Credit enhancement eligibility board; termination July 1, 2026

A. The credit enhancement eligibility board terminates on July 1, 2026.

B. Title 41, chapter 56, articles 10 and 11 are repealed on January 1, 2027 only if both of the following apply:

The board has no outstanding program funding obligations issued pursuant to title 41, chapter 56, article 11 or the legislature has otherwise provided for paying or retiring any outstanding program funding obligations issued pursuant to title 41, chapter 56, article 11.
There are no outstanding guaranteed financings approved pursuant to title 41, chapter 56, article 11.

C. If both of the conditions in subsection B of this section do not exist on January 1, 2027, title 41, chapter 56, articles 10 and 11 are repealed thirty days after both of the conditions in subsection B of this section are met.

§ 41-3026.02 Arizona state veterinary medical examining board; termination July 1, 2026

A. The Arizona state veterinary medical examining board terminates on July 1, 2026.

B. Title 32, chapter 21 and this section are repealed on January 1, 2027.

§ 41-3026.03 Arizona beef council; termination July 1, 2026

A. The Arizona beef council terminates on July 1, 2026.

B. Title 3, chapter 11, article 2 and this section are repealed on January 1, 2027.

§ 41-3026.04 Department of gaming; termination July 1, 2026

A. The department of gaming terminates on July 1, 2026.

B. Sections 5-601, 5-602, 5-602.01, 5-603, 5-604 and this section are repealed on January 1, 2027.

§ 41-3026.05 State land department; termination July 1, 2026

A. The state land department terminates on July 1, 2026.

B. Title 37, chapters 1 and 2 and this section are repealed on January 1, 2027.

§ 41-3026.06 Barbering and cosmetology board; termination July 1, 2026

A. The barbering and cosmetology board terminates on July 1, 2026.

B. Title 32, chapter 5 and this section are repealed on January 1, 2027.

§ 41-3026.07 Arizona state board of pharmacy; termination July 1, 2026

A. The Arizona state board of pharmacy terminates on July 1, 2026.

B. Title 32, chapter 18 and this section are repealed on January 1, 2027.

§ 41-3026.08 Arizona state board of nursing; termination July 1, 2026

A. The Arizona state board of nursing terminates on July 1, 2026.

B. Title 32, chapter 15 and this section are repealed on January 1, 2027.

§ 41-3026.09 Board of occupational therapy examiners; termination July 1, 2026

A. The board of occupational therapy examiners terminates on July 1, 2026.

B. Title 32, chapter 34 and this section are repealed on January 1, 2027.

§ 41-3026.10 Western interstate commission for higher education; termination July 1, 2026

A. The western interstate commission for higher education terminates on July 1, 2026.

B. Title 15, chapter 13, article 8 and this section are repealed on January 1, 2027.

§ 41-3026.11 Arizona civil rights advisory board; termination July 1, 2026

A. The Arizona civil rights advisory board terminates on July 1, 2026.

B. Title 41, chapter 9, article 1 and this section are repealed on January 1, 2027.

§ 41-3026.12 Arizona regulatory board of physician assistants; termination July 1, 2026

A. The Arizona regulatory board of physician assistants terminates on July 1, 2026.

B. Title 32, chapter 25 and this section are repealed on January 1, 2027.

§ 41-3026.13 Arizona racing commission; termination July 1, 2026

A. The Arizona racing commission terminates on July 1, 2026.

B. Title 5, chapter 1 and this section are repealed on January 1, 2027.

§ 41-3026.21 Department of economic security; termination July 1, 2026

A. The department of economic security terminates on July 1, 2026.

B. Title 41, chapter 14 and this section are repealed on January 1, 2027.

§ 41-3026.22 Arizona state boxing and mixed martial arts commission; termination July 1, 2026

A. The Arizona state boxing and mixed martial arts commission terminates on July 1, 2026.

B. Title 5, chapter 2 and this section are repealed on January 1, 2027.

§ 41-3027.01 Arizona fallen firefighter memorial committee; termination July 1, 2027

A. The Arizona fallen firefighter memorial committee terminates on July 1, 2027.

B. Title 41, chapter 12.1, article 3 and this section are repealed on January 1, 2028.

§ 41-3027.02 Water infrastructure finance authority of Arizona; termination July 1, 2027

A. The water infrastructure finance authority of Arizona terminates on July 1, 2027.

B. Title 49, chapter 8, articles 1 and 3 and sections 49-1224, 49-1225, 49-1226, 49-1244, 49-1245, 49-1246, 49-1261, 49-1262, 49-1263, 49-1264, 49-1265, 49-1266, 49-1267, 49-1268, 49-1269, 49-1301, 49-1303, 49-1304, 49-1305, 49-1306, 49-1307, 49-1308, 49-1309, 49-1310, 49-1311, 49-1312 and 49-1313 are repealed on January 1, 2028, if the authority either:

Has no outstanding contractual obligations with the United States or any United States agency and has no debts, obligations or guarantees that were issued for the purposes of title 49, chapter 8.
Has otherwise provided for paying or retiring such debts or obligations.

C. If any debt or obligation listed in subsection B of this section exists and no satisfactory provision has been made to pay or retire the debt or obligation, the authority and statutes continue in existence until the debt or obligation is fully satisfied.

§ 41-3027.03 Office of administrative hearings; termination July 1, 2027

A. The office of administrative hearings terminates on July 1, 2027.

B. Title 41, chapter 6, article 10 and this section are repealed on January 1, 2028.

§ 41-3027.04 Arizona medical board; termination July 1, 2027

A. The Arizona medical board terminates on July 1, 2027.

B. Title 32, chapter 13 and this section are repealed on January 1, 2028.

§ 41-3027.05 Arizona board of regents; termination July 1, 2027

Subject to approval by the voters of a constitutional amendment repealing the authority for the board pursuant to article XI, section 5, Constitution of Arizona:

The Arizona board of regents terminates on July 1, 2027.
Title 15, chapter 13, article 2 and this section are repealed on January 1, 2028.

§ 41-3027.06 Arizona state schools for the deaf and the blind; termination July 1, 2027

A. The board of directors of the Arizona state schools for the deaf and the blind terminates on July 1, 2027.

B. Title 15, chapter 11 and this section are repealed on January 1, 2028.

§ 41-3027.07 Office of economic opportunity; termination July 1, 2027

A. The office of economic opportunity terminates on July 1, 2027.

B. Title 41, chapter 53 and this section are repealed on January 1, 2028, if the office:

Has no outstanding contractual obligations with the United States or any United States agency.
Has no debts, obligations or guarantees that were issued.
Has otherwise provided for paying or retiring such debts or obligations.

C. If any debt or obligation listed in subsection B of this section exists and no satisfactory provision has been made to pay or retire the debt or obligation, the office and statutes continue in existence until the debt or obligation is fully satisfied.

§ 41-3027.08 Municipal tax code commission; termination July 1, 2027

A. The municipal tax code commission terminates on July 1, 2027.

B. Section 42-6052 and this section are repealed on January 1, 2028.

§ 41-3027.09 Arizona department of housing; termination July 1, 2027

A. The Arizona department of housing terminates on July 1, 2027.

B. Title 41, chapter 37 and this section are repealed on January 1, 2028.

§ 41-3028.01 Department of revenue; termination; July 1, 2028

A. The department of revenue terminates on July 1, 2028.

B. Title 42, chapter 1, article 1 and this section are repealed on January 1, 2029.

§ 41-3028.02 State board of psychologist examiners; termination July 1, 2028

A. The state board of psychologist examiners terminates on July 1, 2028.

B. Title 32, chapter 19.1 and this section are repealed on January 1, 2029.

§ 41-3028.03 Department of health services; termination July 1, 2028

A. The department of health services terminates on July 1, 2028.

B. The provisions of title 36 relating to the department of health services and its divisions, title 32, chapter 12 and this section are repealed on January 1, 2029.

§ 41-3028.04 Arizona department of homeland security; termination July 1, 2028

A. The Arizona department of homeland security terminates on July 1, 2028.

B. Title 41, chapter 41 and this section are repealed on January 1, 2029.

§ 41-3028.05 Department of child safety; termination July 1, 2028

A. The department of child safety terminates on July 1, 2028.

B. Title 8, chapter 4 and this section are repealed on January 1, 2029.

§ 41-3028.06 Commission for the deaf and the hard of hearing; termination July 1, 2028

A. The commission for the deaf and the hard of hearing terminates on July 1, 2028.

B. Title 36, chapter 17.1 and this section are repealed on January 1, 2029.

§ 41-3028.07 Board of athletic training; termination July 1, 2028

A. The board of athletic training terminates on July 1, 2028.

B. Title 32, chapter 41 and this section are repealed on January 1, 2029.

§ 41-3028.08 State foster care review board; termination July 1, 2028

A. The state foster care review board terminates on July 1, 2028.

B. Section 8-515.04 and this section are repealed on January 1, 2029.

§ 41-3028.09 Residential utility consumer office; termination July 1, 2028

A. The residential utility consumer office terminates on July 1, 2028.

B. Title 40, chapter 2, article 11 and this section are repealed on January 1, 2029.

§ 41-3028.10 Department of water resources; termination July 1, 2028

A. The department of water resources terminates on July 1, 2028.

B. Title 45, chapter 1, article 1 and this section are repealed on January 1, 2029.

§ 41-3028.12 Office of ombudsman-citizens aide; termination July 1, 2028

A. The office of ombudsman-citizens aide terminates on July 1, 2028.

B. Title 41, chapter 8, article 5 and this section are repealed on January 1, 2029.

§ 41-3028.13 State board of investment; termination July 1, 2028

A. The state board of investment terminates on July 1, 2028.

B. Section 35-311 and this section are repealed on January 1, 2029.

§ 41-3028.14 Board of homeopathic and integrated medicine examiners; termination July 1, 2028

A. The board of homeopathic and integrated medicine examiners terminates on July 1, 2028.

B. Title 32, chapter 29 and this section are repealed on January 1, 2029.

§ 41-3028.15 Industrial commission of Arizona; termination July 1, 2028

A. The industrial commission of Arizona terminates on July 1, 2028.

B. Title 23, chapter 1 and this section are repealed on January 1, 2029.

§ 41-3029.01 Arizona state library, archives and public records; termination July 1, 2029

A. The Arizona state library, archives and public records terminates on July 1, 2029.

B. Title 41, chapter 1, article 2.1 and this section are repealed on January 1, 2030.

§ 41-3029.02 State board on geographic and historic names; termination July 1, 2029

A. The state board on geographic and historic names terminates on July 1, 2029.

B. Title 41, chapter 4.1, article 3 and this section are repealed on January 1, 2030.

§ 41-3029.03 Board of library examiners; termination July 1, 2029

A. The board of library examiners terminates on July 1, 2029.

B. Section 11-906 and this section are repealed on January 1, 2030.

§ 41-3029.04 Naturopathic physicians medical board; termination July 1, 2029

A. The naturopathic physicians medical board terminates on July 1, 2029.

B. Title 32, chapter 14 and this section are repealed on January 1, 2030.

§ 41-3029.05 State board of optometry; termination July 1, 2029

A. The state board of optometry terminates on July 1, 2029.

B. Title 32, chapter 16 and this section are repealed on January 1, 2030.

§ 41-3029.06 Arizona health care cost containment system; termination July 1, 2029

A. The Arizona health care cost containment system terminates on July 1, 2029.

B. Title 36, chapter 29 and this section are repealed on January 1, 2030.

§ 41-3029.07 Office of Sonora; termination July 1, 2029

A. The office of Sonora terminates on July 1, 2029.

B. Section 41-107 and this section are repealed on January 1, 2030.

§ 41-3029.08 Developmental disabilities advisory council; termination July 1, 2029

A. The developmental disabilities advisory council terminates on July 1, 2029.

B. Section 36-553 and this section are repealed on January 1, 2030.

§ 41-3029.09 Arizona department of agriculture; termination July 1, 2029

A. The Arizona department of agriculture and all divisions, offices, councils and committees organized within the department terminate on July 1, 2029.

B. Title 3, chapter 1, article 1 and this section are repealed on January 1, 2030.

§ 41-3029.10 Board of medical student loans; termination July 1, 2029

A. The board of medical student loans terminates on July 1, 2029.

B. Title 15, chapter 13, article 7 and this section are repealed on January 1, 2030.

§ 41-3029.11 Agricultural employment relations board; termination July 1, 2029

A. The agricultural employment relations board terminates on July 1, 2029.

B. Title 23, chapter 8, article 5 and this section are repealed on January 1, 2030.

§ 41-3029.12 Board of fingerprinting; termination July 1, 2029

A. The board of fingerprinting terminates on July 1, 2029.

B. Title 41, chapter 3, article 12 and this section are repealed on January 1, 2030.

§ 41-3029.13 Arizona commerce authority; termination July 1, 2029

A. The Arizona commerce authority terminates on July 1, 2029.

B. Title 41, chapter 10 and this section are repealed on January 1, 2030.

§ 41-3029.14 State board of podiatry examiners; termination July 1, 2029

A. The state board of podiatry examiners terminates on July 1, 2029.

B. Title 32, chapter 7 and this section are repealed on January 1, 2030.

§ 41-3029.15 Governor's regulatory review council; termination July 1, 2029

A. The governor's regulatory review council terminates on July 1, 2029.

B. Title 41, chapter 6, article 5 and this section are repealed on January 1, 2030.

§ 41-3029.16 Arizona criminal justice commission; termination July 1, 2029

A. The Arizona criminal justice commission terminates on July 1, 2029.

B. Sections 41-2404 and 41-2405 and this section are repealed on January 1, 2030.

§ 41-3030.01 Legislative council; termination July 1, 2030

A. The legislative council terminates on July 1, 2030.

B. Title 41, chapter 8, article 1 and this section are repealed on January 1, 2031.

§ 41-3030.02 Joint legislative budget committee; termination July 1, 2030

A. The joint legislative budget committee terminates on July 1, 2030.

B. Title 41, chapter 7, article 10 and this section are repealed on January 1, 2031.

§ 41-3030.03 State auditor general; termination July 1, 2030

A. The state auditor general terminates on July 1, 2030.

B. Title 41, chapter 7, articles 10.1 and 10.2 and this section are repealed on January 1, 2031.

§ 41-3030.04 Department of veterans' services; Arizona veterans' service advisory commission; termination July 1, 2030

A. The department of veterans' services and the Arizona veterans' service advisory commission terminate on July 1, 2030.

B. Title 41, chapter 3, article 7 and this section are repealed on January 1, 2031.

§ 41-3030.05 State real estate department; termination July 1, 2030

A. The state real estate department terminates on July 1, 2030.

B. Title 32, chapter 20 and this section are repealed on January 1, 2031.

§ 41-3030.06 State board of dispensing opticians; termination July 1, 2030

A. The state board of dispensing opticians terminates on July 1, 2030.

B. Title 32, chapter 15.1 and this section are repealed on January 1, 2031.

§ 41-3030.07 Arizona game and fish department; termination July 1, 2030

A. The Arizona game and fish department, the Arizona game and fish commission and the director of the Arizona game and fish department terminate on July 1, 2030.

B. Title 17, chapter 2, articles 1, 2 and 3 and this section are repealed on January 1, 2031.

§ 41-3030.08 Water quality appeals board; termination July 1, 2030

A. The water quality appeals board terminates on July 1, 2030.

B. Title 49, chapter 2, article 7 and this section are repealed on January 1, 2031.

§ 41-3030.09 State board of chiropractic examiners; termination July 1, 2030

A. The state board of chiropractic examiners terminates on July 1, 2030.

B. Title 32, chapter 8 and this section are repealed on January 1, 2031.

§ 41-3030.10 Arizona commission on the arts; termination July 1, 2030

A. The Arizona commission on the arts terminates on July 1, 2030.

B. Title 41, chapter 5, article 6 and this section are repealed on January 1, 2031.

§ 41-3030.11 Department of public safety; termination July 1, 2030

A. The department of public safety terminates on July 1, 2030.

B. Section 13-3828, title 41, chapter 12 and this section are repealed on January 1, 2031.

§ 41-3030.12 Department of administration; termination July 1, 2030

A. The department of administration terminates on July 1, 2030.

B. Title 41, chapter 4, articles 1, 2, 3, 4, 5 and 7, title 18, chapter 1 and this section are repealed on January 1, 2031.

§ 41-3030.13 Office of tourism; termination July 1, 2030

A. The office of tourism terminates on July 1, 2030.

B. Title 41, chapter 19 and this section are repealed on January 1, 2031.

§ 41-3030.14 Military affairs commission; termination July 1, 2030

A. The military affairs commission terminates on July 1, 2030.

B. Section 26-261 and this section are repealed on January 1, 2031.

§ 41-3030.15 State department of corrections; termination July 1, 2030

A. The state department of corrections terminates on July 1, 2030.

B. Title 41, chapter 11 and this section are repealed on January 1, 2031.

§ 41-3030.16 Public safety personnel retirement system board of trustees; termination July 1, 2030

A. The public safety personnel retirement system board of trustees terminates on July 1, 2030.

B. Title 38, chapter 5, articles 3, 3.1, 3.2, 4, 4.1, 4.2, 5.1 and 6 and this section are repealed on January 1, 2031.

§ 41-3030.17 School facilities oversight board; termination July 1, 2030

A. The school facilities oversight board terminates on July 1, 2030.

B. Title 41, chapter 56, articles 1, 2, 3, 4, 5, 6, 7, 8 and 9 and this section are repealed on January 1, 2031 only if either:

The board has no outstanding state school facilities revenue bonds issued pursuant to title 41, chapter 56, article 6, no outstanding state school improvement revenue bonds issued pursuant to title 41, chapter 56, article 7 and no outstanding lease-to-own transactions pursuant to sections 41-5703, 41-5704 and 41-5705.
The legislature has otherwise provided for paying or retiring any outstanding state school facilities revenue bonds, any outstanding state school improvement revenue bonds and any outstanding lease-to-own transactions.

C. If neither of the conditions in subsection B of this section has occurred on or before January 1, 2031, title 41, chapter 56, articles 1, 2, 3, 4, 5, 6, 7, 8 and 9 and this section are repealed thirty days after the retirement of all revenue bonds issued pursuant to title 41, chapter 56, articles 6 and 7 and all outstanding lease-to-own transactions issued pursuant to sections 41-5703, 41-5704 and 41-5705.

§ 41-3030.18 Board of executive clemency; termination July 1, 2030

A. The board of executive clemency terminates on July 1, 2030.

B. Title 31, chapter 3 and this section are repealed on January 1, 2031.

§ 41-3030.20 Department of environmental quality; termination July 1, 2030

A. The department of environmental quality terminates on July 1, 2030.

B. Title 49, chapter 1, articles 1 and 2 and this section are repealed on January 1, 2031.

§ 41-3030.21 Department of juvenile corrections; termination July 1, 2030

A. The department of juvenile corrections terminates on July 1, 2030.

B. Title 41, chapter 26 and this section are repealed on January 1, 2031.

§ 41-3030.25 Acupuncture board of examiners; termination July 1, 2030

A. The acupuncture board of examiners terminates on July 1, 2030.

B. Title 32, chapter 39 and this section are repealed on January 1, 2031.

§ 41-3030.26 Board of technical registration; termination July 1, 2030

A. The board of technical registration terminates on July 1, 2030.

B. Title 32, chapter 1 and this section are repealed on January 1, 2031.

§ 41-3031.01 Board of massage therapy; termination July 1, 2031

A. The board of massage therapy terminates on July 1, 2031.

B. Title 32, chapter 42 and this section are repealed on January 1, 2032.

§ 41-3031.02 Arizona state board of accountancy; termination July 1, 2031

A. The Arizona state board of accountancy terminates on July 1, 2031.

B. Title 32, chapter 6 and this section are repealed on January 1, 2032.

§ 41-3031.03 Board of respiratory care examiners; termination July 1, 2031

A. The board of respiratory care examiners terminates July 1, 2031.

B. Title 32, chapter 35 and this section are repealed on January 1, 2032.

§ 41-3031.04 Arizona grain research and promotion council; termination July 1, 2031

A. The Arizona grain research and promotion council terminates on July 1, 2031.

B. Title 3, chapter 3, article 9 and this section are repealed on January 1, 2032.

§ 41-3031.05 Arizona board of osteopathic examiners in medicine and surgery; termination July 1, 2031

A. The Arizona board of osteopathic examiners in medicine and surgery terminates on July 1, 2031.

B. Title 32, chapter 17 and this section are repealed on January 1, 2032.

§ 41-3031.06 Arizona state parks board; termination July 1, 2031

A. The Arizona state parks board terminates on July 1, 2031.

B. Title 41, chapter 3, article 1.1 and this section are repealed on January 1, 2032.

§ 41-3031.07 Board of behavioral health examiners; termination July 1, 2031

A. The board of behavioral health examiners terminates July 1, 2031.

B. Title 32, chapter 33 and this section are repealed on January 1, 2032.

§ 41-3031.09 State board of dental examiners; termination July 1, 2031

A. The state board of dental examiners terminates on July 1, 2031.

B. Title 32, chapter 11 and this section are repealed on January 1, 2032.

§ 41-3031.11 Law enforcement merit system council; termination July 1, 2031

A. The law enforcement merit system council terminates on July 1, 2031.

B. Title 41, chapter 12, article 10 and this section are repealed on January 1, 2032.

§ 41-3031.12 State board of tax appeals; termination July 1, 2031

A. The state board of tax appeals terminates on July 1, 2031.

B. Sections 42-1252 and 42-1253 and this section are repealed on January 1, 2032.

§ 41-3031.13 Department of emergency and military affairs; state emergency council; termination July 1, 2031

A. The department of emergency and military affairs and the state emergency council terminate on July 1, 2031.

B. Title 26 and this section are repealed on January 1, 2032.

§ 41-3031.14 Department of liquor licenses and control; termination July 1, 2031

A. The department of liquor licenses and control terminates on July 1, 2031.

B. Title 4 and this section are repealed on January 1, 2032.

§ 41-3031.16 Arizona outdoor recreation coordinating commission; termination July 1, 2031

A. The Arizona outdoor recreation coordinating commission terminates on July 1, 2031.

B. Title 41, chapter 3, article 1.2 and this section are repealed on January 1, 2032.

§ 41-3032.01 State board for charter schools; termination July 1, 2032

A. The state board for charter schools terminates on July 1, 2032.

B. Section 15-182 and this section are repealed on January 1, 2033.

§ 41-3032.02 Board of physical therapy; termination July 1, 2032

A. The board of physical therapy terminates on July 1, 2032.

B. Title 32, chapter 19 and this section are repealed on January 1, 2033.

§ 41-3032.03 Board of examiners of nursing care institution administrators and assisted living facility managers; termination July 1, 2032

A. The board of examiners of nursing care institution administrators and assisted living facility managers terminates on July 1, 2032.

B. Title 36, chapter 4, article 6 and this section are repealed on January 1, 2033.

§ 41-3032.04 Registrar of contractors agency; termination July 1, 2032

A. The registrar of contractors agency terminates on July 1, 2032.

B. Title 32, chapter 10 and this section are repealed on January 1, 2033.

§ 41-3032.05 Governor's office on tribal relations; termination July 1, 2032

A. The governor's office on tribal relations terminates on July 1, 2032.

B. Title 41, chapter 15 and this section are repealed on January 1, 2033.

§ 41-3032.06 Department of transportation; termination July 1, 2032

A. The department of transportation terminates on July 1, 2032.

B. Title 28 and this section are repealed on January 1, 2033.

§ 41-3032.07 Cotton research and protection council; termination July 1, 2032

A. The cotton research and protection council terminates on July 1, 2032.

B. Title 3, chapter 10 and this section are repealed on January 1, 2033.

§ 41-3032.08 Arizona historical society; termination July 1, 2032

A. The Arizona historical society terminates on July 1, 2032.

B. Title 41, chapter 4.1, article 1 and this section are repealed on January 1, 2033.

§ 41-3032.09 Prescott historical society of Arizona; termination July 1, 2032

A. The Prescott historical society of Arizona terminates on July 1, 2032.

B. Title 41, chapter 4.1, article 2 and this section are repealed on January 1, 2033.

§ 41-3032.10 State personnel board; termination July 1, 2032

A. The state personnel board terminates on July 1, 2032.

B. Title 41, chapter 4, article 6 and this section are repealed on January 1, 2033.

§ 41-3032.12 Arizona pioneers' home; state hospital for miners with disabilities; termination July 1, 2032

A. The Arizona pioneers' home and the state hospital for miners with disabilities terminate on July 1, 2032.

B. Title 41, chapter 5, articles 2 and 3 and this section are repealed on January 1, 2033.

§ 41-3032.13 State board of equalization; termination July 1, 2032

A. The state board of equalization terminates on July 1, 2032.

B. Title 42, chapter 16, article 4 and this section are repealed on January 1, 2033.

§ 41-3032.14 State natural resource conservation board; termination July 1, 2032

A. The state natural resource conservation board terminates on July 1, 2032.

B. Title 41, chapter 58 and this section are repealed on January 1, 2033.

§ 41-3032.16 Arizona power authority; conditional termination; July 1, 2032

A. The Arizona power authority terminates on July 1, 2032, and title 30, chapter 1, article 1 and this section are repealed on January 1, 2033, if the authority:

Has no outstanding contractual obligations with the United States or any United States agency.
Has no debts or obligations that were issued to finance the cost of the Hoover power plant modifications project, the Hoover power plant uprating project or other facilities related to the Boulder Canyon project.
Has otherwise provided for paying or retiring these debts or obligations.

B. If any contractual debt or obligation listed in subsection A of this section exists and a satisfactory provision has not been made to pay or retire the debt or obligation, the authority, and title 30, chapter 1, article 1, shall continue in existence until the debt or obligation is fully satisfied.

§ 41-3032.17 Occupational safety and health advisory committee; termination July 1, 2032

A. The occupational safety and health advisory committee terminates on July 1, 2032.

B. Section 23-409 and this section are repealed on January 1, 2033.

§ 41-3032.18 Boiler advisory board; termination July 1, 2032

A. The boiler advisory board terminates on July 1, 2032.

B. Section 23-486 and this section are repealed on January 1, 2033.

§ 41-3032.19 Occupational safety and health review board; termination July 1, 2032

A. The occupational safety and health review board terminates on July 1, 2032.

B. Sections 23-422 and 23-423 and this section are repealed on January 1, 2033.

§ 41-3032.21 Arizona department of forestry and fire management; termination July 1, 2032

A. The Arizona department of forestry and fire management terminates on July 1, 2032.

B. Title 37, chapter 9 and this section are repealed on January 1, 2033.

§ 41-3032.24 State board for private postsecondary education; termination July 1, 2032

A. The state board for private postsecondary education terminates on July 1, 2032.

B. Title 32, chapter 30 and this section are repealed on January 1, 2033.

§ 41-3032.26 Arizona state retirement system; termination July 1, 2032

A. The Arizona state retirement system board and director terminate on July 1, 2032.

B. Title 38, chapter 5, articles 2 and 2.1 and this section are repealed on January 1, 2033.

§ 41-3033.01 Department of insurance and financial institutions; termination July 1, 2033

If the voters approve a constitutional amendment repealing the authority for the department of insurance pursuant to article XV, section 5, Constitution of Arizona:

The department of insurance and financial institutions terminates on July 1, 2033.
Title 6, title 20, title 32, chapters 9 and 36, title 41, chapter 31, title 44, chapter 2.1 and this section are repealed on January 1, 2034.

§ 41-3033.02 Arizona exposition and state fair board; termination July 1, 2033

A. The Arizona exposition and state fair board terminates on July 1, 2033.

B. Title 3, chapter 8, article 1 and this section are repealed on January 1, 2034.

§ 41-3033.03 Property tax oversight commission; termination July 1, 2033

A. The property tax oversight commission terminates on July 1, 2033.

B. Title 42, chapter 17, article 1 and this section are repealed on January 1, 2034.

§ 41-3035.01 Arizona state lottery commission; termination July 1, 2035

A. Notwithstanding the ten-year limitation prescribed in section 41-2955, subsection B, the Arizona state lottery commission terminates on July 1, 2035.

B. Title 5, chapter 5.1 is repealed on January 1, 2036.

Chapter 28 Spinal and Head Injuries

Article 1 Advisory Council on Spinal and Head Injuries

§ 41-3201 Advisory council on spinal and head injuries; members; qualifications; appointment; terms; compensation; officers; meetings; staffing; definition

A. The advisory council on spinal and head injuries is established in the office of the governor consisting of the following members:

Five members who are appointed by the governor and who are the parent, spouse or guardian of a person who is afflicted with spinal or head injuries.
Four members who are appointed by the governor and who are physicians who represent the professional community of spinal or head injury and spinal or head injury rehabilitation programs.
Four members who are appointed by the governor and who are allied health professionals or administrators of spinal or head injury programs.
Three members who are appointed by the governor and who represent the general public.
The director of the department of economic security or the director's designee.
The director of the department of health services or the director's designee.

B. Members appointed by the governor serve staggered terms of three years. Vacancies occurring other than by expiration of terms shall be filled in the same manner for the balance of the unexpired term.

C. Members of the council are not eligible to receive compensation, but appointed members are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

D. Members serving pursuant to subsection A, paragraphs 5 and 6 are nonvoting members and are not members for purposes of determining if a quorum is present.

E. Council members shall select a chairman, vice-chairman and secretary each calendar year.

F. The council shall convene in a formal meeting at the call of the chairman but in no case less than four times each year. A quorum consists of at least seven voting members.

G. The department of economic security shall provide administrative and staff support services to the council.

H. For the purposes of this section:

"Head injury" means a partial or total disability that is caused by damage to the brain or its coverings, that is not degenerative in nature and that results in a decrease in mental, cognitive, behavioral or physical functioning. Head injury includes a trauma to the central nervous system that prevents a person from being completely self-sufficient. Head injury does not include vascular accidents, aneurysms and congenital defects.
"Spinal injury" means a severance or severe injury to the spinal cord caused by trauma which may result in partial or total paralysis of the arms or legs or both and which may also impair vital functions.

§ 41-3202 Advisory council on spinal and head injuries; duties

A. The advisory council on spinal and head injuries shall:

Advise appropriate state agencies, the governor and the legislature on matters and issues relating to spinal and head injuries and rehabilitation.
Review and make recommendations, plans and strategies for meeting the needs of persons with spinal or head injuries on a statewide basis.
In cooperation with all related organizations, conduct a comprehensive program of professional and public education to heighten awareness of the capabilities, potential and needs of persons with spinal or head injuries.
Serve as a repository of information on spinal or head injuries, referral procedures and demographics of the injury.
Monitor programs and services for persons with spinal or head injuries to encourage efficient and coordinated use of resources in providing services.
Develop plans for the expenditure of the spinal and head injuries trust fund in accordance with guidelines established in section 41-3203.

B. The council may submit a report to the governor, the speaker of the house of representatives and the president of the senate on council recommendations regarding the problems of spinal and head injuries. These recommendations shall be represented by a majority vote of a quorum of members present in a formal meeting. Minority opinions may be submitted in writing to the governor, the speaker of the house of representatives and the president of the senate through the chairman of the council.

C. In developing its recommendations, the council shall encourage broad participation by organizations and individuals interested in spinal or head injuries and rehabilitation.

§ 41-3203 Spinal and head injuries trust fund; purpose

A. The spinal and head injuries trust fund is established. The trust fund shall be administered by the director of the department of economic security, subject to legislative appropriation. The spinal and head injuries trust fund shall consist of revenues derived from assessments imposed pursuant to section 12-116.02 and distributed pursuant to section 36-2219.01, subsection B, paragraph 3.

B. On notice from the department of economic security, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the trust fund. Monies in the fund do not revert to the state general fund.

C. Trust fund monies shall be spent on approval of the department of economic security's rehabilitation services administration only if comparable resources are not available or are not able to be delivered in a timely manner and in accordance with guidelines for the following purposes:

Public information, prevention and education of the general public and professionals.
Rehabilitation, transitional living and equipment necessary for activities of daily living.
A portion of the disease surveillance system and statewide referral services for those with head and spinal injuries.
Costs incurred by the advisory council on spinal and head injuries established pursuant to section 41-3201.
Administrative costs incurred by the department of economic security to administer the provisions of this article.

Chapter 30 Environmental Education Provided by the State Government

Article 1 General Provisions

§ 41-3401 Environmental education provided by state agencies; requirements; definition

A. A state agency shall not engage in instructing the general public in environmental education concepts unless the instruction provided:

Is based on current scientific information.
Includes a discussion of economic and social implications.

B. For purposes of this section, "environmental education" means educational processes, programs and activities which are specifically designed to enhance student acquisition of knowledge of scientific and economic principles, concepts and facts as they relate to environmental topics and issues and which are taught in an unbiased, fair and balanced manner.

Chapter 31 Automobile Theft Authority

Article 1 General Provisions

§ 41-3451 Automobile theft authority; powers and duties; fund; audit

A. The automobile theft authority is established in the department of insurance and financial institutions consisting of the following members:

Two police chiefs who are appointed by an Arizona association of chiefs of police, one of whom represents a city or town with a population of one hundred thousand or more persons and one of whom represents a city or town with a population of less than one hundred thousand persons, or their designees.
Two sheriffs who are appointed by an Arizona sheriffs association, one of whom represents a county with a population of five hundred thousand or more persons and one of whom represents a county with a population of less than five hundred thousand persons, or their designees.
Two county attorneys who are appointed by the governor, one of whom represents a county with a population of two million or more persons and one of whom represents a county with a population of less than two million persons, or their designees.
Two employees of insurers who are licensed to write motor vehicle liability insurance in this state and who are appointed by the governor.
Two members of the general public who are appointed by the governor.
The assistant director for the motor vehicle division in the department of transportation or the assistant director's designee.
The director of the department of public safety or the director's designee.

B. Members serve staggered four-year terms beginning and ending on the third Monday in January. At the first meeting each year, the members shall select a chairman from among the members. The authority shall meet at the call of the chairman or seven members.

C. The authority may:

Subject to chapter 4, article 4 of this title, hire staff members as necessary.
Provide work facilities and equipment as necessary.
Determine the scope of the problem of motor vehicle theft, including particular areas of the state where the problem is greatest.
Analyze the various methods of combating the problem of motor vehicle theft.
Develop and implement a plan of operation.
Develop and implement a financial plan.
Solicit and accept gifts and grants.
Report by December 31 of each year to the governor, the president of the senate, the speaker of the house of representatives and the secretary of state on its activities during the preceding fiscal year.

D. If the chairman of the authority knows that a potential ground for the removal of a member of the authority exists under this subsection, the chairman shall notify the governor. The governor shall remove the member if the governor finds that any of the following applies:

The member was not qualified to serve at the time the member was appointed.
The member does not maintain the member's qualifications to serve.
The member cannot discharge the member's duties for a substantial part of the term due to illness or other disability.
The member is absent from more than one-half of the regularly scheduled meetings during a calendar year unless the member's absence is excused by a majority vote of the authority.

E. The automobile theft authority fund is established consisting of monies deposited pursuant to section 28-2098 and any public or private monies that the authority may receive. The automobile theft authority shall make grants awarded from the fund. Subject to legislative appropriation, monies in the fund shall be used only to pay the administrative expenses of the authority to make grant awards and to carry out the purposes of this section. Monies in the fund are exempt from the provisions of sections 35-143.01 and 35-190 relating to lapsing of appropriations. On notice from the authority, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. All monies appropriated to the department for the automobile theft authority shall be used by the department exclusively for the operation of the automobile theft authority. Monies appropriated from the fund that are included in the general appropriations act shall be included within the following separate line items:

Automobile theft authority operating lump sum appropriation.
Arizona vehicle theft task force.
Local grants.

F. The authority may accept nonmonetary contributions, including the services of individuals, office and secretarial assistance, mailings, printing, office equipment, facilities and supplies, that are necessary to carry out its functions. The nonmonetary contributions shall not be included in the costs of administration limitation prescribed by subsection H of this section.

G. The automobile theft authority shall allocate monies in the fund to public agencies for the purpose of establishing, maintaining and supporting programs that are designed to prevent motor vehicle theft, including:

Financial support to law enforcement and prosecution agencies for programs that are designed to increase the effectiveness of motor vehicle theft prosecution.
Financial support for programs that are designed to educate and assist the public in the prevention of motor vehicle theft.

H. Pursuant to section 20-466, subsection A, the director of the department of insurance and financial institutions shall appoint an individual to operate the automobile theft authority in conjunction with operating the fraud unit established by section 20-466. Subject to generally applicable department standards and procedures, the department of insurance and financial institutions shall provide all administrative support for the authority. The costs of administration shall not exceed ten percent of the monies in the fund in any one year so that the greatest possible portion of the monies available to the authority is expended on combating motor vehicle theft.

I. Monies expended from the automobile theft authority fund shall be used to supplement, not supplant, other monies that are available for motor vehicle theft prevention.

J. Each insurer issuing motor vehicle liability insurance policies in this state shall pay a semiannual fee of $.50 per vehicle insured under a motor vehicle liability insurance policy issued by the insurer. The fee shall be fully earned and nonrefundable at the time the insurer collects the premium for the motor vehicle liability insurance policy. Each insurer shall transmit the fee on or before January 31 and on or before July 31 of each year to the automobile theft authority for deposit in the automobile theft authority fund. The payment due on or before January 31 shall cover vehicles insured under policies that are issued during the period from July 1 through December 31 of the previous year. The payment due on or before July 31 shall cover vehicles insured under policies that are issued during the period from January 1 through June 30 of the same year.

K. The authority shall cause an audit to be made of the automobile theft authority fund. The audit shall be conducted by a certified public accountant every two years. The authority shall file a certified copy of the audit with the auditor general immediately. The auditor general may make further audits and examinations as the auditor general deems necessary and may take appropriate action relating to the audit pursuant to chapter 7, article 10.1 of this title.

L. Authority members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

M. This section does not apply to vehicles or vehicle combinations with a declared gross weight of more than twenty-six thousand pounds. Motor vehicle liability insurance policies issued in this state for vehicles or vehicle combinations with a declared gross weight of more than twenty-six thousand pounds are exempt from subsection J of this section.

§ 41-3452 Personal or vehicle information confidentiality

A. Any personal or vehicle information that is voluntarily submitted by a person to the automobile theft authority established by this article or that is disseminated by the automobile theft authority to another state agency as part of a program that is designed to reduce automobile theft is not public information and is not subject to disclosure pursuant to title 39, chapter 1.

B. This section does not apply to aggregate statistical information that is released in aggregate form.

§ 41-3453 Failure to pay fee; overpayment; refund; audit; definitions

A. The automobile theft authority shall notify the director of an insurer's failure to pay the fee prescribed by section 41-3451, subsection J. On receiving notice of an insurer's failure to pay the fee, the director may suspend the insurer's certificate of authority or impose a civil penalty of not more than one hundred twenty percent of the amount due, or both. The insurer shall pay the civil penalty to the director. The director shall deposit, pursuant to sections 35-146 and 35-147, the civil penalty in the automobile theft authority fund.

B. An insurer that has overpaid the fee prescribed by section 41-3451 is entitled to a refund of the overpaid amount. The insurer shall submit a written request for a refund to the automobile theft authority within one year after the date that the overpaid assessment was due and payable pursuant to the dates specified in section 41-3451, subsection J, and include documentation or any other information satisfactory to the director to substantiate the actual overpaid amount. The director shall approve or deny a refund of the amount specified in the insurer’s request. If the director approves a refund request the director shall refund to the insurer the amount specified in the insurer’s request from the automobile theft authority fund established by section 41-3451.

C. The director may audit an insurer that issues motor vehicle liability insurance policies in this state for the purposes of determining whether the insurer is in compliance with this chapter. The expenses of an audit conducted under this subsection shall be paid by the insurer.

D. For the purposes of this section:

"Director" means the director of the department of insurance and financial institutions.
"Insurer" means an insurer that writes motor vehicle insurance in this state, including reciprocal insurers, mutual companies, mutual associations and Lloyd's plans.

Chapter 33 Regulation of Nonhealth Professions and Occupations

Article 1 General Provisions

§ 41-3501 Definitions

In this chapter, unless the context otherwise requires:

"Government certification" means a voluntary program in which this state grants nontransferable recognition to an individual who meets personal qualifications that are established by law.
"Government registration" means a requirement to give notice to the government, which may include the individual's name and address, the individual's agent for service of process, the location of the activity to be performed and a description of the service the individual provides.
"Lawful occupation" means a course of conduct, pursuit or profession that includes the sale of goods or services that are not themselves illegal to sell, irrespective of whether the individual selling them is subject to occupational regulation.
"Less restrictive regulation" means, from least to most restrictive:

(a) Nongovernment regulation, including:

(i) Private certification.

(ii) Deceptive trade practice laws.

(iii) Mandatory disclosure of attributes of the specific good or service.

(b) Regulation of the process of providing the specific good or service.

(d) Inspection regulations.

(e) Bonding requirements.

(f) Insurance requirements.

(g) Government registration.

(h) Government certification.

(i) Occupational or professional license.

"Occupational or professional license" means a nontransferable authorization for an individual to perform exclusively a lawful occupation for compensation based on meeting personal qualifications that are established by law.
"Occupational regulation":

(a) Means a statute, rule, practice, policy or other state law that allows an individual to use an occupational title or work in a lawful occupation.

(b) Includes a government registration, a government certification and an occupational or professional license.

(c) Does not include a business license, facility license, building permit or zoning and land use regulation except to the extent those state laws regulate an individual's personal qualifications to perform a lawful occupation.

"Personal qualifications" means criteria that are related to an individual's personal background and characteristics, including completion of an approved educational program, satisfactory performance on an examination, work experience or other evidence of attainment of requisite skills or knowledge, moral character, criminal history and completion of continuing education.
"Private certification" means a voluntary program in which a private organization grants nontransferable recognition to an individual who meets personal qualifications that are established by the private organization.

§ 41-3502 Regulating professions and occupations; criteria

A. A profession or occupation shall not be regulated except for the exclusive purpose of protecting the public interest. Regulation shall not be imposed for the exclusive purpose of protecting a profession or occupation from economic competition. Except as provided in title 32, chapter 31, all regulation of a profession or occupation for the first time shall be reviewed according to the criteria prescribed in subsection B of this section.

B. This state shall regulate a profession or occupation only if all of the following apply:

There is credible evidence of harm that the unregulated practice threatens the public health, safety or welfare in this state.
The actual or anticipated public benefit of the regulation clearly exceeds the costs imposed on consumers, businesses and individuals.
The public needs and can reasonably be expected to benefit from government regulation.
The public cannot be effectively protected by less restrictive regulations.

C. After evaluating the criteria prescribed in subsection B of this section, if it is necessary to regulate a profession or occupation not previously regulated by law, the regulation shall be in the least restrictive manner as prescribed by this article.

D. The legislative committee of reference may hold hearings to evaluate the criteria prescribed in subsection B of this section. The legislative committee of reference may request information from state agencies that contract with individuals in regulated occupations and others with knowledge of the occupation or labor market economics.

E. The legislative committee of reference shall provide the findings and recommendations to the standing committee to which the proposed legislation is assigned. The standing committee shall address all of the following:

The type of regulations, if any, that are appropriate pursuant to subsections B and C of this section.
If applicable, the scope of practice and requisite personal qualifications that are appropriate for a government certification or occupational or professional license.
The extent to which failure to regulate a profession or occupation will result in:

(a) The loss of insurance.

(b) An impact to the ability to practice in other states or as required by federal law.

(d) The loss of constitutionally afforded practices.

F. Notwithstanding any other law, an agency that issues new occupational or professional licenses, registrations or certificates shall not hinder the regulated industry through the delayed awarding of a license, registration or certificate.

G. Subsections B and C of this section do not preempt federal regulations or require a private certification organization to grant or deny private certification to an individual.

§ 41-3503 Applicant groups; nonhealth professions and occupations; written report

Applicant groups shall submit a written report explaining the factors prescribed in section 41-3504 to the president of the senate and the speaker of the house of representatives. The report shall be submitted on or before September 1 before the start of the legislative session for which the legislation is proposed. The president of the senate or the speaker of the house of representatives shall assign the written report to the appropriate legislative committee of reference. The legislative committee of reference shall study the written report and deliver the report of its recommendations to the speaker of the house of representatives, the president of the senate, the governor and, if appropriate, the regulatory entity on or before the third Friday in January of the year following the year in which the report is submitted. Legislative committees of reference may hold hearings as they deem necessary.

§ 41-3504 Applicants for regulation; factors

Applicant groups for regulation shall explain each of the following factors to the extent requested by the legislative committees of reference:

A definition of the problem and why regulation is necessary.
The efforts made to address the problem.
The alternatives considered.
The benefit to the public if regulation is granted.
The extent to which regulation might harm the public.
The maintenance of standards, including:

(a) Whether effective quality assurance standards exist in the profession, such as legal requirements associated with specific programs that define or enforce standards or a code of ethics.

(b) How the proposed legislation will assure quality including:

(i) The extent to which a code of ethics, if any, will be adopted.

(ii) The grounds for suspension or revocation of registration, certification or licensure.

A description of the group proposed for regulation, including a list of associations, organizations and other groups representing the practitioners in this state, an estimate of the number of practitioners in each group and whether the groups represent different levels of practice.
The expected costs of regulation.

§ 41-3505 Board actions; records; website; legislative advocacy

A. If a nonhealth profession regulatory board dismisses a complaint, the record of that complaint is available to that regulatory board and the public pursuant to section 39-121 but may not appear on the board's website. For the purposes of this subsection, "dismisses a complaint" means that a board does not issue a disciplinary or nondisciplinary order or action against a licensee or certificate holder.

B. If a nonhealth profession regulatory board issues a nondisciplinary order or action against a licensee or certificate holder, the record of the nondisciplinary order or action is available to that board and the public pursuant to section 39-121 but may not appear on the board's website, except that a practice limitation or restriction, and documentation relating to that action, may appear on the board's website.

C. If a nonhealth profession regulatory board maintains a website, the board must display on its website a statement that a person may obtain additional public records related to any licensee or certificate holder, including dismissed complaints and nondisciplinary actions and orders, by contacting the board directly.

D. This section does not prohibit a nonhealth profession regulatory board from conducting its authorized duties in a public meeting.

E. Subsections A and B of this section do not apply to meeting minutes and notices kept by the board in accordance with the public meeting requirements of title 38, chapter 3, article 3.1.

F. The director of a nonhealth profession regulatory board may not advocate for or against a legislative proposal in the director's official capacity until the regulatory board has taken a formal position on the proposal in a public meeting.

Chapter 34 Charitable Choice in Contracts for Goods and Services

Article 1 Charitable Choice

§ 41-3751 Contracts for goods and services; religious organizations; definitions

A. Notwithstanding any other law or executive order, and in accordance with this section, all public bodies shall contract for goods and services provided pursuant to title 8, 36 or 46 or title 31, chapter 2, article 6 without discrimination against religious organizations, including discrimination because of their religious beliefs or exercise of religion and shall provide beneficiaries of assistance under the programs established by law with certificates, vouchers or other forms of disbursement that are redeemable with these organizations that are awarded a contract. The public bodies may use any state, federal, local or other monies available for these purposes.

B. The public bodies shall allow contracts with religious organizations to provide goods and services provided pursuant to title 8, 36 or 46 or title 31, chapter 2, article 6 and to accept certificates, vouchers or other forms of disbursement under any program established on the same basis as any other nongovernmental provider without impairing the religious character of these organizations, and without diminishing the religious freedom of beneficiaries of assistance funded under these programs. The programs shall be implemented consistent with the first amendment of the United States Constitution. The public bodies shall not discriminate against an organization that is or applies to be a contractor to provide assistance or that accepts certificates, vouchers or other forms of disbursement on the basis that the organization has a religious character.

C. A religious organization with a contract described in this section shall retain its independence from federal, state and local governments, including the religious organization's control over the definition, development, practice and expression of its religious beliefs. Public bodies shall not require a religious organization to alter its form of internal governance or to remove religious art, icons, scripture or other symbols in order to be eligible to contract to provide assistance or to accept certificates, vouchers or other forms of disbursement funded under any program or public contract.

D. If a person who applies for or receives goods, services or disbursements objects to the religious character of the organization or institution from which the person receives or would receive assistance funded under any program, the public body shall provide the person, within a reasonable period of time after the date of the objection, with assistance from an alternative provider that is accessible to the person if an alternative provider is available and the value of which is not less than the value of assistance that the person would have received from the religious organization. Organizations shall provide notice to people receiving assistance of the right to object pursuant to this subsection.

E. A religious organization's exemption provided under section 702 of the civil rights act of 1964 (P.L. 88-352; 78 Stat. 255; 42 United States Code section 2000e-1a) regarding employment practices is not affected by its participation in or receipt of monies from programs described in this section. Nothing in this section allows religious organizations to discriminate in employment practices on the basis of race, age, color, sex or national origin.

F. Except as otherwise provided by law, a religious organization shall not discriminate against a person in regard to rendering assistance funded under any program described in this section on the basis of religion, a religious belief or refusal to participate in a religious practice, or on the basis of race, age, color, sex or national origin.

G. Except as provided in subsection H, any religious organization that contracts to provide goods, services or assistance funded under any program is subject to the same rules as other contractors to account in accordance with generally accepted auditing principles for the use of the monies provided under the program.

H. If a religious organization segregates public monies provided under these programs into separate accounts, only the programs funded by financial assistance provided with these monies are subject to financial and performance audits.

I. Appeals from the decisions of the head of a state agency, board or commission may be made to the director of the department of administration in accordance with the rules of procedure adopted by the director pursuant to chapter 23, article 9 of this title to resolve bid protests.

J. A religious organization whose rights have been violated under this section may assert that violation as a claim or defense in an administrative proceeding or a judicial proceeding once all administrative remedies have been exhausted and obtain appropriate relief, including injunctive relief and compensatory damages. A religious organization that prevails in an action to enforce this section may seek to recover attorney fees and costs pursuant to section 12-348.

K. No monies provided directly to institutions or organizations to provide services and administer programs under this section may be spent for sectarian worship, instruction or proselytization. This subsection does not apply to the contracting for the services of chaplains by a public body.

L. For the purposes of this section:

"Exercise of religion" has the same meaning prescribed in section 41-1493.
"Public body" means state agencies, boards and commissions and political subdivisions of this state.

Chapter 35 Independent Oversight Committees

Article 1 General Provisions

§ 41-3801 Independent oversight committee on persons with developmental disabilities

A. The independent oversight committee on persons with developmental disabilities is established in the department of administration to promote the rights of clients who are receiving developmental disabilities services pursuant to title 36, chapter 5.1.

B. The committee shall be organized pursuant to this section and the requirements of section 41-3804.

C. The director of the department may establish additional committees for each district office established pursuant to section 41-1961 or to oversee the activities of any service provider.

D. Each independent oversight committee established pursuant to this section shall consist of at least seven and not more than fifteen members appointed by the director of the department with expertise in at least one of the following areas:

Psychology.
Law.
Medicine.
Education.
Special education.
Social work.
Criminal justice.

E. Each independent oversight committee shall include at least two parents of children who receive services from the division of developmental disabilities.

F. The division of developmental disabilities shall provide to each independent oversight committee information regarding incidents of:

Possible abuse or neglect or violations of rights.
Physical abuse, sexual abuse and other abuse.
Accidental injury.
Missing clients.
Behavioral emergency measures.
Medication errors, including theft of medication or missing medication.
Death.
Suicide attempts.
Hospitalizations.
Incarcerations.
Theft of client property or money.
Property destruction.

G. The division of developmental disabilities in the department of economic security must allow the independent oversight committee on persons with developmental disabilities thirty days to review new policies and major policy changes before the division submits the policies or changes for public comment.

§ 41-3802 Independent oversight committee on children, youth and families

A. The independent oversight committee on children, youth and families is established in the department of administration to promote the rights of persons who receive services from the department.

B. Notwithstanding section 8-807, the department shall disclose confidential information and records to the committee established pursuant to this section or designated pursuant to subsection C of this section, subject to the requirements of section 41-3804 and applicable federal law.

C. The director of the department may designate a citizen review panel, multidisciplinary case consultation team or other oversight entity as the independent oversight committee on children, youth and families if the panel, team or entity meets the requirements of this section.

D. The committee shall be organized pursuant to this section and the requirements of section 41-3804.

E. The director of the department may establish additional committees for each district office established pursuant to section 41-1961 or to oversee the activities of any service provider.

F. Each independent oversight committee established pursuant to this section shall consist of at least seven and not more than fifteen members appointed by the director of the department with expertise in at least one of the following areas:

Psychology.
Law.
Medicine.
Education.
Special education.
Social work.

G. Each independent oversight committee shall include at least two parents of children who receive services from the department. If a report of abuse has been substantiated against a parent, that parent shall not serve on an independent oversight committee.

§ 41-3803 Independent oversight committee on the mentally ill; membership; community forums; meetings; training plan; Arizona state hospital

A. The independent oversight committee on the mentally ill is established in the department of administration to promote the rights of persons who receive behavioral health services pursuant to:

Section 13-3992 or 13-3994.
Title 36, chapters 5 and 34.

B. Each region of this state covered by a regional behavioral health authority shall have at least one independent oversight committee with the authority and responsibilities as prescribed by the department of administration pursuant to rules adopted by the department relating to behavioral health services.

C. The director of the department may establish additional committees to serve persons who receive behavioral health services or to oversee the activities of any service provider.

D. Each independent oversight committee shall consist of at least seven and not more than fifteen members appointed by the director of the department with expertise in at least one of the following areas:

Psychology.
Law.
Medicine.
Education.
Special education.
Social work.
Mental health.
Housing for the mentally ill.
Criminal justice.
Public safety.

E. Each independent oversight committee, if appropriate, shall include at least two parents of children who receive behavioral health services pursuant to title 36, chapter 34.

F. Each independent oversight committee shall include at least one member who is a current or former client of the behavioral health system.

G. Current or former providers or employees of providers that have contracted with a regional behavioral health authority may serve on an independent oversight committee but may not hold more than two positions on the committee.

H. Each independent oversight committee may hold one or more community forums annually to receive comments regarding the experiences of individuals living with serious mental illness, and their family members and caregivers, across the care continuum.

I. The department shall ensure that each regional behavioral health authority and its providers develop and implement a human rights training plan to ensure that providers are trained regarding clients' human rights and the duties of the independent oversight committees.

J. The independent oversight committee at the Arizona state hospital shall have oversight of patients who have been determined to have a serious mental illness and who are hospitalized and receiving behavioral health services at the civil and forensic hospital pursuant to subsection A of this section. The Arizona state hospital's administration and employees may not retaliate against a patient because the patient or the patient's family participates in the independent oversight committee meetings. A patient or patient's family that alleges retaliation must provide to the independent oversight committee in writing a detailed description of the retaliation and how the retaliation is connected to the patient's or family's participation in the independent oversight committee meetings. This subsection does not preclude the Arizona state hospital's administration from taking action against a patient who violates hospital policies or procedures. The Arizona state hospital shall provide to the committee, subject to state and federal law, information regarding the following:

Seclusion of and the use of restraints on patients.
Incident accident reports.
Allegations of illegal, dangerous or inhumane treatment of patients.
Provisions of services to patients in need of special assistance.
Allegations of neglect and abuse.
Allegations of denial of rights afforded to patients with serious mental illness except if a right may be restricted for the safety of a patient, the state hospital or the public.

K. The Arizona state hospital superintendent and chief medical officer, or their designees, shall attend and participate in scheduled meetings of the independent oversight committee at the Arizona state hospital, except for the public comment period. The superintendent and the chief medical officer, or their designees, shall give a report to and respond to questions from the independent oversight committee members. Questions from the independent oversight committee members to the superintendent and the chief medical officer, or their designees, are limited to subjects specified in subsection J of this section. The superintendent shall ensure that the Arizona state hospital administration:

Fully cooperates with the independent oversight committee in all aspects of its work, as outlined in subsection J of this section.
Facilitates and supports the independent oversight committee's activities related to the Arizona state hospital and pursuant to the department of administration's rules.
Responds to the independent oversight committee with information that is responsive to inquiries made pursuant to this subsection or responds in writing as to why a request was denied.

L. Each committee shall be organized pursuant to this section and the requirements of section 41-3804.

§ 41-3804 Independent oversight committees; membership; duties; client information; immunity; violation; classification

A. To fulfill the purposes of section 41-3803, the director of the department of administration, in conjunction with each independent oversight committee established pursuant to section 41-3803, shall adopt policies relating to the authority and responsibility of the independent oversight committees established pursuant to this article that define the processes and procedures that each independent oversight committee and each department or service provider that is subject to oversight must follow. Before adopting the policies, the director shall post the proposed policies on the department's public website for a period of thirty days and provide for public comment. The director shall consider the public comments when adopting the proposed policies.

B. Subject to the approval of the director of the department of administration, each committee established pursuant to this article shall adopt guidelines that govern its operation, including terms of members, quorum and attendance requirements and removal of a committee member if necessary. Each committee shall adopt these guidelines by majority vote. Each newly formed committee shall adopt these guidelines within the first three months of its formation. These guidelines shall not conflict with this article, title 38, chapter 3, article 3.1 or the policies adopted by the director. The director shall approve the guidelines unless they are inconsistent with the statutes, policies, procedures or rules that are applicable to the independent oversight committees or if the guidelines do not promote participation by all interested members of the community that the committee serves. In addition to the procedures in the guidelines, each independent oversight committee must approve the removal of any committee member on majority vote of the committee. The director shall provide committee members the opportunity to review potential changes to rules or policies that affect the committee.

C. Employees of the department of economic security, the department of child safety, the Arizona health care cost containment system, the Arizona health care cost containment system administration, the department of health services and subject-matter experts may serve on a committee only as nonvoting members whose presence is not counted for the purpose of determining a quorum.

D. Advocacy groups, local advisory councils, committee members and the director of the department of administration may submit names of candidates to fill committee vacancies. The director of the department of administration shall appoint a person to fill a vacancy subject to the approval of the committee.

E. Each committee shall meet at least quarterly each calendar year.

F. Each committee shall provide independent oversight to:

Ensure that the rights of clients are protected.
Review incidents of possible abuse, neglect or denial of a client's rights.
Make recommendations to the director of any department and service provider subject to oversight under this article and to the legislature regarding laws, rules, policies, procedures and practices to ensure the protection of the rights of clients receiving behavioral health and developmental disability services.

G. Each committee shall submit written objections to specific problems or violations of client rights by the department or service provider through the director of the department of administration for review by the director of the department that is responsible for the client. The director of the department shall deliver to the committee a detailed written response to each written objection within twenty-one calendar days after receiving the objection from the department of administration.

H. Each committee shall issue an annual report of its activities and recommendations, if any, to the director of the department of administration, the director of the department of economic security, the director of the department of child safety, the director of the department of health services, the director of the Arizona health care cost containment system, the president of the senate, the speaker of the house of representatives and the chairpersons of the senate health and human services committee and the house of representatives health and human services committee, or their successor committees.

I. The department of administration shall post on the department's website a copy of the agenda of each committee's meetings and a copy of the annual report that is required by this section.

J. A committee may request from a department the services of a consultant to advise the committee on specific issues. The consultant may be a member of another independent oversight committee, an employee or consultant from a department or a service provider. Subject to the availability of monies, the department shall assume the cost of the consultant. A consultant shall not participate in committee votes.

K. Subject to federal and state law, attorney client privilege and attorney work product doctrine and to the extent necessary to conduct committee duties, committee members and consultants shall have access to client information and records, including quality of care reports, incident reports and investigation reports and, on request, case presentations, adult protective services investigation case status and outcomes, substantiations, recommendations and other quality of care findings from peer reviews or any successor report or process, maintained by a department, service provider or regional behavioral health authorities. The department or service provider shall redact protected information in documents if the department or service provider determines in good faith that the information is protected under this section. If the department or service provider in good faith determines that the information or records requested by a committee cannot be provided even in a redacted form pursuant to federal law, attorney client privilege or attorney work product doctrine, the department or service provider shall object in writing to the request within the time frame set forth under subsection G of this section in a manner that, without revealing the information that is believed to be protected, enables the requesting committee to understand the basis on which the department or service provider determined the information or records are protected. Each person who receives information or records pursuant to this subsection shall maintain the information or records as strictly confidential and sign an agreement to comply with all confidentiality requirements. Any client information or records shall be released to the committee without the designation of personally identifiable information unless the personally identifiable information is required for the official purposes of the committee. A violation of this subsection is a class 2 misdemeanor. For the purposes of this subsection, "personally identifiable information" includes a person's name, address, date of birth, social security number, tribal enrollment number, telephone or fax number, e-mail address, social media identifier, driver license number, places of employment, school identification or military identification number or any other distinguishing characteristic that tends to identify a particular person.

L. For information and records requested and provided pursuant to this section regarding persons with developmental disabilities for the work of the independent oversight committee on persons with developmental disabilities established by section 41-3801, the department of economic security and not the service provider shall provide the information and records and redact any necessary information.

M. Within its jurisdiction, each committee that has oversight responsibilities for clients who are seriously mentally ill shall, for a client who needs special assistance, and may, for any other client who is seriously mentally ill make regular site visits to a residential environment and meet with the client in a residential environment to determine the client's satisfaction with the residential environment, if each client or the client's guardian is given the right to decline for any reason and without explanation to participate in any part of a site visit conducted by any independent oversight committee.

N. If a committee's request for information or records from a department or service provider is denied, including an objection pursuant to subsection G of this section, and if requested by the committee, at least one representative of the department or service provider and at least one committee member shall meet and confer within five business days after the date of the request or on a later date that is agreed to by both parties and shall in good faith attempt to resolve the objection informally and cooperatively. After meeting and conferring, the committee may request in writing that the director of a department review this decision. The director shall timely conduct the review and, not later than twenty-one calendar days, after receiving the request for review, the director shall deliver to the committee a written decision explaining in detail the factual and legal basis and reasoning for the department's decision. The department shall bear the costs of conducting the review. A final agency decision made pursuant to this subsection is subject to judicial review pursuant to title 12, chapter 7, article 6. The department shall not release any information or records during the period an appeal may be filed or is pending.

O. Confidential records and information received by the committee or its consultant are subject to the same provisions concerning subpoenas, discovery and use in legal actions as are the original records and information.

P. The independent oversight committees may exchange information and engage in planning and coordination activities between committee members in the performance of committee duties pursuant to this section.

Q. The independent oversight committees may encourage public awareness and involvement in their activities by supporting committee members with affiliation agreements with postsecondary education-sponsored internship placements pursuant to the department's approved operating procedures.

R. The department shall coordinate education and training programs for committee members to facilitate their role as independent oversight committee members. The department shall coordinate statewide meetings of committees at least every two years and provide staff for the committees.

S. Any person who, in good faith and without malice and in connection with duties or functions of a committee established pursuant to this article, takes an action or makes a decision or recommendation as a member or agent of a committee or who furnishes records, information or assistance that is related to the duties of a committee is not subject to liability for civil damages in consequence of that action. The court shall determine the presence of malice by clear and convincing evidence.

T. Title 38, chapter 3, article 8, relating to conflict of interest, applies to all committee members.

U. Each independent oversight committee and each appropriate department and service provider shall at all times conduct activities provided in this section in good faith to promote and protect the rights of persons who receive behavioral health services pursuant to title 36, chapters 5 and 34.

Chapter 37 Housing

Article 2 Arizona Department of Housing

§ 41-3951 Definitions

In this article, unless the context otherwise requires:

"Department" means the Arizona department of housing.
"Director" means the director of the Arizona department of housing.
"Low and moderate income" means household income that is insufficient to secure decent, safe and sanitary housing provided by private industry without subsidized financing and that is below respective income limits established by the department, taking into consideration such factors as:

(a) The total income of the household available for housing needs.

(b) The size of the household.

(d) The ability to obtain housing for the household in the private housing market and to pay the amounts at which private enterprise is providing decent, safe and sanitary housing.

(e) The standards established by various programs of the federal government for determining eligibility based on household or family income.

§ 41-3952 Arizona department of housing; director

A. The Arizona department of housing is established.

B. The governor shall appoint the director pursuant to section 38-211. The director serves at the pleasure of the governor.

C. The director shall administer the department.

D. The director and such other employees as the director determines are entitled to receive compensation as determined under section 38-611.

E. Subject to chapter 4, article 4 of this title, the director shall appoint a deputy director and, subject to legislative appropriation, may appoint assistant directors as the director deems appropriate.

F. Subject to chapter 4, article 4 of this title, the director shall employ, determine the conditions of employment and specify the duties of administrative, secretarial and clerical employees the director deems necessary.

G. The director may organize the department into divisions the director deems appropriate.

§ 41-3953 Department powers and duties; definition

A. The department is responsible for establishing policies, procedures and programs that the department is authorized to conduct to address the affordable housing issues confronting this state, including housing issues of low-income families, moderate-income families, housing affordability, special needs populations and decaying housing stock. Among other things, the department shall provide to qualified housing participants and political subdivisions of this state financial, advisory, consultative, planning, training and educational assistance for the development of safe, decent and affordable housing, including housing for low and moderate income households. The department is responsible for maintaining and enforcing standards of quality and safety for manufactured homes, mobile homes and factory-built buildings.

B. Under the direction of the director, the department shall:

Establish guidelines applicable to the programs and activities of the department for the construction and financing of affordable housing and housing for low and moderate income households in this state. These guidelines shall meet or exceed all applicable state or local building and health and safety code requirements and, if applicable, the national manufactured home construction and safety standards act of 1974 and title VI of the housing and community development act of 1974 (P.L. 96-399, as amended by P.L. 95-128, 96-153 and 96-339). Guidelines established pursuant to this paragraph do not apply to the department's activities prescribed in section 35-726, subsection E.
Accept and allocate any monies as from time to time may be appropriated by the legislature for the purposes set forth in this article.
Perform other duties necessary to administer this chapter.
Perform the duties prescribed in sections 35-726 and 35-728.
Stimulate and encourage all local, state, regional and federal governmental agencies and all private persons and enterprises that have similar and related objectives and purposes, cooperate with the agencies, persons and enterprises and correlate department plans, programs and operations with those of the agencies, persons and enterprises.
Conduct research on its own initiative or at the request of the governor, the legislature or state or local agencies pertaining to any department objectives.
Provide information and advice on request of any local, state or federal agencies, private persons and business enterprises on matters within the scope of department activities.
Consult with and make recommendations to the governor and the legislature on all matters concerning department objectives.
Make annual reports to the governor and the legislature on its activities, including the geographic location of its activities, its finances and the scope of its operations. The annual reports submitted pursuant to this paragraph shall also include all of the following outcome-based metrics for department-funded projects and initiatives:

(a) The number of affordable housing units developed in this state.

(b) The number of individuals housed in permanent supportive housing environments in the past year and related housing outcomes for those exiting permanent supportive housing for which the department has conveyed funding.

Maintain and enforce standards of quality and safety for manufactured homes, mobile homes and factory-built buildings and enforce rules adopted by the board pursuant to section 41-4010.
As a condition of funding for emergency shelter and transitional housing programs that receive grants or other sources of funding from the department, adopt policies and procedures concerning responding to an alleged sale, manufacture or possession of dangerous drugs and narcotic drugs as defined in section 13-3401. These policies shall include clear signage on the facilities denoting a drug-free zone.

C. Under the direction of the director, the department may:

Assist in securing construction and mortgage financing from public and private sector sources.
Assist mortgage financing programs established by industrial development authorities and political subdivisions of this state.
Assist in the acquisition and use of federal housing assistance programs pertinent to enhance the economic feasibility of a proposed residential development.
Assist in the compliance of a proposed residential development with applicable federal, state and local codes and ordinances.
Prepare and publish planning and development guidelines for the establishment and delivery of housing assistance programs.
Contract with a federal agency to carry out financial work on the federal agency's behalf and accept payment for the work.
Subcontract for the financial work prescribed in paragraph 6 of this subsection and make payments for that subcontracted work based on the expectation that the federal agency will pay for that work.
Accept payment from a federal agency for work prescribed in paragraph 6 of this subsection and deposit those payments in the Arizona department of housing program fund established by section 41-3957.
Contract for the services of outside advisers, consultants and aides reasonably necessary or desirable to enable the department to adequately perform its duties.
Contract for and incur obligations reasonably necessary or desirable within the general scope of department activities and operations to enable the department to adequately perform its duties.
Use any media of communication, publication and exhibition in the dissemination of information, advertising and publicity in any field of its purposes, objectives or duties.
Adopt rules deemed necessary or desirable to govern its procedures and business.
Contract with other agencies in furtherance of any department program.
Use monies, facilities or services to provide contributions under federal or other programs that further the objectives and programs of the department.
Accept gifts, grants, matching monies or direct payments from public or private agencies or private persons and enterprises for the conduct of programs that are consistent with the general purposes and objectives of this article and deposit these monies in the Arizona department of housing program fund established by section 41-3957.
Establish and collect fees and receive reimbursement of costs in connection with any programs or duties performed by the department and deposit the fees and cost reimbursements in the Arizona department of housing program fund established by section 41-3957.
Provide staff support to the board of manufactured housing.

D. For the purposes of this section, the department is exempt from chapter 23 of this title.

E. The department is the designated state public housing agency as defined in the United States housing act of 1937 (42 United States Code sections 1401 through 1440) for the purpose of accepting federal housing assistance monies and may participate in the housing assistance payments program. Federal monies may be secured for all areas of this state subject only to the limitations prescribed in subsection F of this section.

F. For areas of this state where an existing public housing authority has not been established pursuant to section 36-1404, subsection A, the department acting as a public housing agency may undertake all activities under the section 8 tenant-based rental housing assistance payment program, except that the department shall not undertake a section 8 tenant-based rental housing assistance payment program within the boundaries of a city, town or county unless authorized by resolution of the governing body of the city, town or county. If the department accepts monies for a section 8 tenant-based rental housing assistance payment program for areas of this state where an existing public housing authority has been established pursuant to section 36-1404, subsection A, the department shall only accept and secure federal monies to provide housing for the seriously mentally ill or other populations with disabilities. The department may accept and secure federal monies for undertaking all contract administrator activities authorized under a section 8 project-based rental housing assistance payment program in all areas of this state and this participation does not require the authorization of any local governing body.

G. The department shall not itself directly own, construct, operate or rehabilitate any housing units, except as may be necessary to protect the department's collateral or security interest arising out of any department programs.

H. Notwithstanding any other provision of this section, the department may obligate monies as loans or grants applicable to programs and activities of the department for the purpose of providing housing opportunities for low or moderate income households or for housing affordability or to prevent or combat decaying housing stock. Unless otherwise required by federal or state law, any loan repayments shall be deposited in the Arizona department of housing program fund established by section 41-3957.

I. For any construction project financed by the department pursuant to subsection C of this section, except for contract administration activities in connection with the project-based section 8 program, the department shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The department shall not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.

J. The department has the administrative responsibility through its hearing officer function concerning alleged violations of the Arizona mobile home parks residential landlord and tenant act under title 33, chapter 11.

K. The Arizona department of housing shall act consistently with the minimum standards of the United States department of housing and urban development so as to be designated the state inspector for manufactured homes and related industries. The Arizona department of housing shall implement all existing laws and regulations established by the federal government, its agencies and this state for that purpose.

L. For the purposes of this section, "permanent supportive housing" means long-term housing assistance paired with supportive services that are aimed at individuals experiencing homelessness or individuals with special needs.

§ 41-3955 Housing trust fund; purpose; annual report

A. The housing trust fund is established, and the director shall administer the fund. The fund consists of monies from unclaimed property deposited in the fund pursuant to section 44-313, monies transferred pursuant to section 35-751 and investment earnings.

B. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. Except as provided in subsection D of this section, fund monies shall be spent on approval of the department for developing projects and programs connected with providing housing opportunities for low and moderate income households and for housing affordability programs. A portion of fund monies shall be used exclusively for housing in rural areas.

D. Fund monies may be spent on constructing or renovating facilities and on housing assistance, including support services. Fund monies shall be awarded in the following order of priority for the first four months of each fiscal year:

Constructing or renovating emergency shelter facilities or for any operational expenses for emergency shelter services.
Constructing or renovating transitional housing units.
Constructing or renovating other types of shelter or housing as determined by the department to best serve the needs of individuals who have been determined to be seriously mentally ill and chronically resistant to treatment.

E. For the purposes of subsection C of this section, in approving the expenditure of monies, the director shall give priority to funding projects that provide for operating, constructing or renovating facilities for housing for low-income families and that provide housing and shelter to families that have children.

F. After the four-month period prescribed in subsection D of this section, fund monies that have not been awarded or encumbered pursuant to the priority list prescribed in subsection D of this section may be spent based on stakeholder feedback.

G. The department shall submit for review by the joint legislative budget committee all programs established by the department and funded by the housing trust fund pursuant to this section.

H. The director shall report annually to the legislature on the status of the housing trust fund. The report shall include a summary of facilities for which funding was provided during the preceding fiscal year and shall show the cost and geographic location of each facility and the number of individuals benefiting from the operation, construction or renovation of the facility. The report shall also include the number of individuals who benefit from housing assistance pursuant to subsection D of this section. The report shall be submitted to the president of the senate and the speaker of the house of representatives, and a copy provided to the secretary of state, not later than September 1 of each year.

I. Monies in the housing trust fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

J. An amount not to exceed ten percent of the housing trust fund monies may be appropriated annually by the legislature to the department for administrative costs in providing services relating to the housing trust fund.

K. For any construction project financed by the department pursuant to this section, the department shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The department shall not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.

§ 41-3955.01 Seriously mentally ill housing trust fund; purpose; report

A. The seriously mentally ill housing trust fund is established. The director of the Arizona health care cost containment system administration shall administer the fund. The fund consists of monies received pursuant to section 44-313 and investment earnings.

B. On notice from the director of the Arizona health care cost containment system administration, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. Fund monies shall be spent on approval of the Arizona health care cost containment system administration solely for housing projects and rental assistance for seriously mentally ill persons.

D. The director of the Arizona health care cost containment system administration shall report annually to the legislature on the status of the seriously mentally ill housing trust fund. The report shall include a summary of facilities for which funding was provided during the preceding fiscal year and shall show the cost and geographic location of each facility and the number of individuals benefiting from the operation, construction or renovation of the facility. The report shall also include the number of individuals who benefited from rental assistance. The report shall be submitted to the president of the senate and the speaker of the house of representatives not later than September 1 of each year.

E. Monies in the seriously mentally ill housing trust fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

F. An amount not to exceed ten percent of the seriously mentally ill housing trust fund monies may be appropriated annually by the legislature to the Arizona health care cost containment system for administrative costs in providing services relating to the seriously mentally ill housing trust fund.

G. For any construction project financed by the Arizona health care cost containment system administration pursuant to this section, the administration shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The Arizona health care cost containment system administration shall not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.

§ 41-3955.02 Military transitional housing fund; purposes; annual report; definition

A. The military transitional housing fund is established consisting of legislative appropriations and monies allocated from any federal sources, including monies provided by affordable housing legislation and unused or undesignated donations and undesignated federal monies for which military transitional housing is eligible. The director shall administer the fund. Monies in the fund are continuously appropriated. Monies shall be deposited in the fund by order of the governor and shall be spent on newly constructed transitional housing, in cooperation with veteran owned and operated nonprofit organizations and for-profit organizations that serve military members who are transitioning to veteran status. Monies may also be used for supportive services and transitional unit rehabilitation for veterans. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. Fund monies shall be spent for developing projects and programs to provide transitional housing opportunities for military members separating from the military to be housed in newly constructed housing facilities and rehabilitated housing for veterans. Monies cannot be spent on unoccupied hotels and motels designated for homeless veterans. Fund monies may only be spent for the specific purpose of providing transitional housing for military members who will be separating or who have recently separated from the military or for veterans and may be spent on purchasing and constructing transitional housing facilities for military members who are transitioning into civilian life and rehabilitating housing units for veterans.

C. On or before September 1 of each year, the director shall submit a report on the status of the military transitional housing fund, including a summary of facilities for which funding was provided during the preceding fiscal year, the cost and geographic location of each facility and the number of individuals benefiting from the operation, purchase or construction of the facility, to the president of the senate and the speaker of the house of representatives and provide a copy of the report to the secretary of state.

D. The department may use not more than ten percent of the fund monies annually to administer the fund.

E. For any construction project financed by the department pursuant to this section, the department shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The department may not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.

F. For the purposes of this section, "undesignated federal monies" means federal stimulus monies and monies originating from federal affordable housing legislation, the United States department of veterans affairs or the United States department of housing and urban development that have not been allocated or approved for a specific purpose or project within three months after the applicable expenditure deadline for the monies.

§ 41-3956 Comprehensive performance measurement system; tracking system; wire transfer protocols; reporting requirements; definitions

A. The department shall:

Establish and implement a comprehensive performance measurement system that requires all of the following:

(a) Annual goals with measurable benchmarks for each housing program in this state.

(b) Mechanisms for data collection and review to assess the effectiveness of the housing programs administered by the department.

(c) Quarterly reporting to the president of the senate and the speaker of the house of representatives regarding program performance outcomes, suggested improvements for affordable housing, reductions in homelessness and other key metrics.

Establish secure wire transfer protocols to mitigate fraud risks, including all of the following:

(a) Dual authorization for all wire transfers that exceed $10,000.

(b) Working within the department's authority to implement real-time fraud detection and reporting measures that are integrated into the financial management system.

Engage the board of manufactured housing established by section 41-4009 to review regulatory fees associated with manufactured housing in this state to ensure alignment with regulatory costs. Any fee changes shall be approved by the board of manufactured housing. All complaints related to manufactured housing must be resolved within the United States department of housing and urban development guidelines pursuant to 24 Code of Federal Regulations part 3288.
Establish a tracking system that monitors complaint resolution timelines. The department shall provide quarterly reports regarding any unresolved complaints to the board of manufactured housing, the president of the senate and the speaker of the house of representatives.
Require all staff to complete a conflict of interest disclosure form annually, review all forms to determine whether there are any substantial interest disclosures and maintain a special file of all substantial interest disclosures.

B. The department shall report any instance of fraudulent activity involving state monies to the governor, the joint legislative budget committee and the auditor general within ten business days. The department shall initiate restitution efforts within thirty days after identifying the fraudulent activity.

C. For the purposes of this section:

"Comprehensive performance measurement system" means a systematic process for tracking, evaluating and reporting on program outcomes, including establishing goals, performance benchmarks and measurable outcomes.
"Wire transfer protocols" means secure processes and standards to prevent unauthorized financial transfers.

§ 41-3957 Arizona department of housing program fund; purpose

A. The Arizona department of housing program fund is established, and the department shall administer the fund. The fund consists of monies deposited pursuant to sections 35-726, 35-728 and 41-3953, other monies directed to be deposited in the fund and investment earnings on monies in the fund. On notice from the department, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. All monies in the fund are designated as special state funds for all purposes of section 35-142.

B. Monies in the fund are continuously appropriated. The department shall use monies in the fund to pay the costs of administering the programs from which the deposits are received and for other department programs.

C. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

Article 3 Office of Manufactured Housing

§ 41-4001 Definitions

In this chapter, unless the context otherwise requires:

"Accessory structure" means the installation, assembly, connection or construction of any one-story habitable room, storage room, patio, porch, garage, carport, awning, skirting, retaining wall, evaporative cooler, refrigeration air conditioning system, solar system or wood decking attached to a new or used manufactured home, mobile home or factory-built building.
"Act" means the national manufactured housing construction and safety standards act of 1974 and title VI of the housing and community development act of 1974 (P.L. 93-383, as amended by P.L. 95-128, 95-557, 96-153 and 96-339).
"Alteration":

(a) Means the replacement, addition, modification or removal of any equipment or installation after the sale by a manufacturer to a dealer or distributor but before the sale by a dealer to a purchaser, which may affect compliance with the standards, construction, fire safety, occupancy, plumbing or heat-producing or electrical system.

(b) Does not include:

(i) The repair or replacement of a component or appliance requiring plug-in to an electrical receptacle if the replaced item is of the same configuration and rating as the component or appliance being repaired or replaced.

(ii) The addition of an appliance requiring plug-in to an electrical receptacle if the appliance is not provided with the unit by the manufacturer and the rating of the appliance does not exceed the rating of the receptacle to which the appliance is connected.

"Board" means the board of manufactured housing.
"Broker" means any person who acts as an agent for the sale or exchange of a used manufactured home or mobile home except as exempted in section 41-4028.
"Certificate" means a numbered or serialized label or seal that is issued by the director as certification of compliance with this chapter.
"Closed construction" means any building, building component, assembly or system manufactured in such a manner that concealed parts or processes of manufacture cannot be inspected before installation at the building site without disassembly, damage or destruction.
"Commercial" means a building with a use-occupancy classification other than single-family dwelling.
"Component" means any part, material or appliance that is built-in as an integral part of the unit during the manufacturing process.
"Consumer" means either a purchaser or seller of a unit regulated by this chapter who uses the services of a person licensed by the department.
"Consummation of sale" means that a purchaser has received all goods and services that the dealer or broker agreed to provide at the time the contract was entered into, the transfer of title or the filing of an affidavit of affixture, if applicable, to the sale. Consummation of sale does not include warranties.
"Dealer" means any person who sells, exchanges, buys, offers or attempts to negotiate or who acts as an agent for the sale or exchange of factory-built buildings, manufactured homes or mobile homes except as exempted in section 41-4028. A lease or rental agreement by which the user acquired ownership of the unit with or without additional remuneration is considered a sale under this chapter.
"Defect" means any defect in the performance, construction, components or material of a unit that renders the unit or any part of the unit unfit for the ordinary use for which it was intended.
"Department" means the Arizona department of housing.
"Director" means the director of the department.
"Earnest monies" means all monies given by a purchaser or a financial institution to a dealer or broker before consummation of the sale.
"Factory-built building":

(a) Means a residential or commercial building that is:

(i) Either wholly or in substantial part manufactured at an off-site location and transported for installation or completion, or both, on-site.

(ii) Constructed in compliance with adopted codes, standards and procedures.

(iii) Installed temporarily or permanently.

(b) Does not include a manufactured home, recreational vehicle, panelized commercial building using open construction, panelized residential building using open or closed construction or domestic or light commercial storage building.

"HUD" means the United States department of housing and urban development.
"Imminent safety hazard" means an imminent and unreasonable risk of death or severe personal injury.
"Installation" means:

(a) Connecting new or used mobile homes, manufactured homes or factory-built buildings to on-site utility terminals or repairing these utility connections.

(b) Placing new or used mobile homes, manufactured homes, accessory structures or factory-built buildings on foundation systems or repairing these foundation systems.

"Installer" means any person who engages in the business of performing installations of manufactured homes, mobile homes or factory-built buildings.
"Installer of accessory structures" means any person who engages in the business of installing accessory structures.
"Listing agreement" means a document that contains the name and address of the seller, the year, manufacturer and serial number of the listed unit, the beginning and ending dates of the time period that the agreement is in force, the name of the lender and lien amount, if applicable, the price the seller is requesting for the unit, the commission to be paid to the licensee and the signatures of the sellers and the licensee who obtains the listing.
"Local enforcement agency" means a zoning or building department of a city, town or county or its agents.
"Manufactured home" means a structure built in accordance with the act.
"Manufacturer" means any person that is engaged in manufacturing, assembling or reconstructing any unit regulated by this chapter.
"Mobile home" means a structure built before June 15, 1976, on a permanent chassis, capable of being transported in one or more sections and designed to be used with or without a permanent foundation as a dwelling when connected to on-site utilities. Mobile home does not include recreational vehicles and factory-built buildings.
"Office" means the office of manufactured housing within the department.
"Open construction" means any building, building component, assembly or system manufactured in such a manner that all portions can be readily inspected at the building site without disassembly, damage or destruction.
"Purchaser" means a person purchasing a unit in good faith from a licensed dealer or broker for purposes other than resale.
"Qualifying party" means a person who is an owner, employee, corporate officer or partner of the licensed business and who has active and direct supervision of and responsibility for all operations of that licensed business.
"Reconstruction" means construction work performed for the purpose of restoration or modification of a unit by changing or adding structural components or electrical, plumbing or heat or air producing systems.
"Recreational vehicle" means a vehicular type unit that is:

(a) A portable camping trailer mounted on wheels and constructed with collapsible partial sidewalls that fold for towing by another vehicle and unfold for camping.

(b) A motor home designed to provide temporary living quarters for recreational, camping or travel use and built on or permanently attached to a self-propelled motor vehicle chassis or on a chassis cab or van that is an integral part of the completed vehicle.

(c) A park trailer built on a single chassis, mounted on wheels and designed to be connected to utilities necessary for operation of installed fixtures and appliances and has a gross trailer area of not less than three hundred twenty square feet and not more than four hundred square feet when it is set up, except that it does not include fifth wheel trailers.

(d) A travel trailer mounted on wheels, designed to provide temporary living quarters for recreational, camping or travel use, of a size or weight that may or may not require special highway movement permits when towed by a motorized vehicle and has a trailer area of less than three hundred twenty square feet. This subdivision includes fifth wheel trailers. If a unit requires a size or weight permit, it shall be manufactured to the standards for park trailers in a 119.5 of the American national standards institute code.

(e) A portable truck camper constructed to provide temporary living quarters for recreational, travel or camping use and consisting of a roof, floor and sides designed to be loaded onto and unloaded from the bed of a pickup truck.

"Residential" means a building with a use-occupancy classification of a single-family dwelling or as governed by the international residential code.
"Salesperson" means any person who, for a salary, commission or compensation of any kind, is employed by or acts on behalf of any dealer or broker of manufactured homes, mobile homes or factory-built buildings to sell, exchange, buy, offer or attempt to negotiate or act as an agent for the sale or exchange of an interest in a manufactured home, mobile home or factory-built building.
"Seller" means a natural person who enters into a listing agreement with a licensed dealer or broker for the purpose of resale.
"Site development" means the development of an area for the installation of the unit's or units' locations, parking, surface drainage, driveways, on-site utility terminals and property lines at a proposed construction site or area.
"Statutory agent" means a person who is on file with the corporation commission as the statutory agent.
"Title transfer" means a true copy of the application for title transfer that is stamped or validated by the appropriate government agency.
"Unit" means a manufactured home, mobile home, factory-built building or accessory structures.
"Used unit" means any unit that is regulated by this chapter and that has been sold, bargained, exchanged or given away from a purchaser who first acquired the unit that was titled in the name of that purchaser.
"Workmanship" means a minimum standard of construction or installation reflecting a journeyman quality of the work of the various trades.

§ 41-4002 Office of manufactured housing; purpose

The purpose of the office of manufactured housing within the department is to maintain and enforce standards of quality and safety for manufactured homes, factory-built buildings, mobile homes and accessory structures and installation of manufactured and mobile homes, factory-built buildings and accessory structures. The affairs of the office of manufactured housing shall be conducted consistently with minimum standards of the United States department of housing and urban development so as to be designated the "state inspector" for manufactured homes and related industries. The office shall implement all existing laws and regulations mandated by the federal government, its agencies and this state for such purposes.

§ 41-4004 Powers and duties of department; work by unlicensed person; inspection agreement; permit

A. The department shall:

Establish a state inspection and design approval bureau within the department.
Enter into reciprocity agreements and compacts with other states or private organizations that adopt and maintain standards of construction reasonably consistent with those adopted pursuant to this article on determining that such standards are being enforced. The director may void such agreements on determining such standards are not being maintained.
Issue a certificate to indicate compliance with the construction requirements of this article.
Enter and inspect or investigate premises at reasonable times, after presentation of credentials by the director or personnel of the office or under contract with the office, where units regulated by this article are manufactured, sold or installed, to determine if any person has violated this chapter or the rules adopted pursuant to this chapter.
Enter into agreements with local enforcement agencies to enforce the installation standards in their jurisdiction provided the director is monitoring their performance to be consistent with the installation standards of the office.
If an inspection reveals that a mobile home entering this state for sale or installation is in violation of this chapter, order its use discontinued and the mobile home or any portion of the mobile home vacated. The order to vacate shall be served on the person occupying the mobile home and copies of the order shall be posted at or on each exit of the mobile home. The order to vacate shall include a reasonable period of time in which the violation can be corrected.
If an inspection of a new installation of any mobile home or manufactured home reveals that the natural gas or electrical connections of the installation do not conform to the installation standards promulgated pursuant to this chapter and the nonconformance constitutes an immediate danger to life and property, the inhabitants of the home shall be notified immediately and in their absence a notice citing the violations shall be posted in a conspicuous location. The director may order that the public service corporation, municipal corporation or other entity or individual supplying the service to the unit discontinue such service. If the danger is not immediate, the director shall allow at least twenty-four hours to correct the condition before ordering any discontinuation of service.
If construction, installation, rebuilding or any other work is performed in violation of this chapter or any rule adopted pursuant to this chapter, order the work stopped. The order to stop work shall be served on the person doing the work or on the person causing the work to be done. The person served with the order shall immediately cease the work until authorized by the office to continue.
Verify written complaints filed with the office by purchasers within one year after the date of purchase or installation of units. Complaints shall be accepted from consumers that allege violations by any dealer, broker, salesperson, installer or manufacturer of this chapter or the rules adopted pursuant to this chapter.
On verification of a complaint pursuant to paragraph 9 of this subsection, serve notice to the dealer, broker, salesperson, installer or manufacturer that such verified complaint shall be satisfied as specified by the office.
Provide to the board every six months the year-to-date fund balance of and a listing of the year-to-date revenues and expenditures from the mobile home relocation fund established by section 33-1476.02. The information shall be updated and posted on the department's website.

B. Any dealer, broker, salesperson, installer or manufacturer licensed by the office shall respond within thirty days to a notice served pursuant to subsection A, paragraph 10 of this section. Failure to respond is grounds for disciplinary action pursuant to section 41-4039.

C. If an inspection or an investigation reveals that any work that is required to be performed by a licensee was performed by an unlicensed person required to be licensed pursuant to this chapter, the director, an employee or a person under contract with the office may cite the unlicensed person. The citation may be issued and served pursuant to section 13-3903. The action shall be filed in the justice court in the precinct where the unlicensed activity occurred.

D. The director may enter into agreements with acceptable qualified building inspection personnel or inspection organizations for enforcement of inspection requirements provided the director is monitoring their performance to be consistent with this chapter, rules adopted pursuant to this chapter and the established procedures of the office. If the director determines that the person's or organization's performance is not consistent with this chapter, rules adopted pursuant to this chapter and the established procedures of the office, the person or organization may not enforce the contract and the aggrieved person shall be entitled to a refund of the consideration paid under the agreement.

E. If a mobile or manufactured home or factory-built building is installed without first obtaining an installation permit, the director shall send a written notice to the purchaser specifying that a permit is required. If a permit is not obtained within thirty days after receipt of the written notice, the department shall issue and serve by personal service or certified mail a citation on the purchaser. Service of the citation by certified mail is complete after forty-eight hours after the time of deposit in the mail. On failure of the purchaser to comply with the citation within twenty days after its receipt, the director shall file an action in the justice court in the precinct where installation occurred for violation of this subsection.

§ 41-4005 Submission of construction, reconstruction or alteration plans by manufacturers; approval; revocation

A. Before the construction of any new model of factory-built building, each manufacturer who intends to manufacture for delivery or sell such unit in this state shall submit to the director for approval detailed plans of each model and shall have obtained such approval.

B. Before reconstruction of any factory-built building, including those for which the director has not approved plans before construction, the licensee shall submit to the director for approval detailed plans of the factory-built building that indicate conformance with this state's adopted codes as certified by an engineer who is registered pursuant to title 32, chapter 1.

C. Before installation of a factory-built building or accessory structure, each licensee who intends to accomplish the construction shall submit to the director for approval detailed plans for each project and shall obtain the director's approval.

D. The office or a third-party inspector who is authorized by the director to verify compliance with the approved plans shall inspect the factory-built building.

E. A plan approval may be immediately suspended by the written notice of the director if the director has reasonable cause to believe that the licensee is not complying with the plan as approved or that the licensee has used inferior materials or workmanship in construction. This notice shall be served by personal service to an in-state licensee and by certified mail to an out-of-state licensee. Service of process by certified mail is complete after forty-eight hours from the time of deposit in the mail.

§ 41-4006 Preemption of local building codes; responsibility for maintenance of utility connections

A. No building code or local enforcement agency or its adopted building codes may require, as a condition of entry into or sale in any county or municipality, that any unit that has been certified pursuant to this chapter be subjected to any local enforcement inspection to determine compliance with any standard covering any aspect of the unit that is inspected pursuant to this article.

B. Except where a local enforcement agency participates in the office permit and certificate issuance program for the installation of manufactured homes, mobile homes, factory-built buildings and accessory structures and inspection of such installations, no local enforcement agency shall subject any unit installed to any local inspections or charge a fee for any services provided pursuant to this article.

C. A local enforcement agency in any county or municipality shall recognize the minimum standards of the act as equal to any nationally accepted or locally adopted building code standard.

D. Nothing in subsection A, B or C of this section shall prevent the application of local codes and ordinances governing zoning requirements, fire zones, building setback, maximum area and fire separation requirements, site development and property line requirements and requirements for on-site utility terminals for factory-built buildings, manufactured homes and mobile homes.

E. Notwithstanding any other provision of this section, the owner of a manufactured home or mobile home located in a park subject to title 33, chapter 11 is responsible for the maintenance of utility connections from any outlets furnished by the landlord pursuant to section 33-1434 to the unit, except that the landlord is responsible for the maintenance of connections for any distance greater than twenty-five feet to the point at which the utility connections are the property of the providing utility company if the outlet is located outside the lot line of the owner's unit and is more than twenty-five feet from the unit. A local enforcement agency that determines that local code requirements are not being met or that maintenance or safety activities are needed for utility connections may not require anyone except the responsible party to perform or pay for such activities.

§ 41-4007 Notification and correction of defects by manufacturer; notice to purchaser

A. Every manufacturer of units shall furnish notification of any defect in any unit produced by such manufacturer which he determines, in good faith, relates to a construction or safety standard adopted pursuant to this chapter or contains a defect which constitutes an imminent safety hazard to the purchaser of such unit, within sixty days after such manufacturer has discovered the defect. Every manufacturer of units shall maintain a record of the names and addresses of the purchaser of each unit for the purposes of this section. Such information shall be provided by the dealer or broker upon purchase of each unit and reported monthly to the manufacturer.

B. The notification required by subsection A shall contain a clear description of such defect or failure to comply with such construction or safety standards, an evaluation of the risk to the occupants' safety reasonably related to such defect and a statement of the measures needed to repair the defect. The notification shall also inform the owner whether the defect will be corrected at no cost to the purchaser of the unit or at the expense of the purchaser.

§ 41-4008 Costs of complying with standards; reimbursement from relocation fund; definition

A. The costs of bringing a mobile home into compliance with the requirements of this article may be reimbursed to the owner from the mobile home relocation fund established by section 33-1476.02 if all of the following are true:

The mobile home is moved from one mobile home park in this state to another mobile home park in this state.
The household income of the owner of the mobile home is at or below one hundred per cent of the current federal poverty level guidelines as published annually by the United States department of health and human services.
The mobile home is not being relocated as the result of a judgment in a forcible detainer or special detainer action requiring the owner to vacate the mobile home park in which the mobile home is located.

B. The amount of the reimbursement pursuant to this section shall not exceed one thousand five hundred dollars for the costs related to any mobile home.

C. The fund shall have a claim for reimbursement of sums received under this section by an individual who fails to reside in the mobile home for six months following its relocation, unless the failure was due to the death or disability of a resident.

D. For the purposes of this section, "owner" means an individual whose primary residence has been the mobile home continuously for the six-month period preceding an application for reimbursement, or an individual who has purchased the mobile home and who intends to reside in the mobile home as the individual's primary residence after the relocation.

§ 41-4009 Board of manufactured housing; members; meetings

A. The board of manufactured housing is established. The board consists of the following nine members who are appointed by the governor pursuant to section 38-211:

One member who represents the manufacturers of manufactured homes.
One member who represents the installer industry.
One member who represents manufactured home park owners.
One member who represents financial institutions.
One member who represents the manufacturers of factory-built buildings.
One Member who represents the dealers and brokers.
Three members of the public, at least one of whom has as his residence a mobile or manufactured home and is a resident of a mobile home park or manufactured home park, who represent who the consumers of this state.

B. Each member shall be appointed for a term of three years. The governor may remove any member from the board for incompetency, improper conduct, disability or neglect of duty. Members are eligible to receive compensation pursuant to section 38-611 and are eligible for reimbursement for expenses incurred while attending meetings called by the board pursuant to title 38, chapter 4, article 2.

C. The board annually shall select from its membership a chairperson for the board.

D. The board shall meet on call of the chairperson or on the request of at least four members.

§ 41-4010 Powers and duties of board

A. The board shall:

Adopt rules imposing minimum construction requirements for factory-built buildings and components thereof that are reasonably consistent with nationally recognized and accepted publications or generally accepted manufacturing practices pertinent to the construction and safety standards for such item to be manufactured. These standards shall include minimum requirements for the safety and welfare of the public.
Adopt rules imposing requirements for body and frame design and construction and installation of plumbing, heating and electrical systems for manufactured homes that are consistent with the rules and regulations for construction and safety standards adopted by the United States department of housing and urban development.
Adopt rules relating to plan approvals as to requirements for the design, construction, alteration, reconstruction and installation of units or accessory structures as deemed necessary by the board to carry out this chapter.
Establish a schedule of fees, payable by persons, licensees or owners of units regulated by this chapter, for inspections, licenses, permits, plan reviews, administrative functions and certificates so that the total annual income derived from such fees will not be less than ninety-five percent and not more than one hundred five percent of the anticipated expenditures for the administration of the activities described in this subsection.
Adopt rules relating to the inspection throughout the state by the department of the installation of manufactured homes, mobile homes, factory-built buildings and accessory structures included as part of a sales contract for a manufactured home, mobile home or factory-built building or included in an agreement to move a manufactured home, mobile home or factory-built building.
Establish and maintain licensing standards and bonding requirements for all manufacturers of manufactured homes and factory-built buildings regulated pursuant to this chapter.
Establish and maintain licensing standards and bonding requirements for all dealers and brokers of manufactured homes, mobile homes and factory-built buildings thereof who sell or arrange the sale of such products within this state.
Establish and maintain licensing standards and bonding requirements for all installers of manufactured homes, mobile homes and accessory structures and certified standards for all persons who repair these homes and structures under warranties and who are not employees of the manufacturer.
Establish and maintain licensing standards for all salespersons of manufactured homes, mobile homes and factory-built buildings. These standards shall not include educational requirements.
Adopt rules consistent with the United States department of housing and urban development procedural and enforcement regulations and enter into such contracts necessary to administer the federal manufactured home regulations.
Adopt rules imposing minimum fire and life safety requirements in the categories of fire detection equipment, flame spread for gas furnace and water heater compartments, egress windows, electrical system and gas system for mobile homes entering this state.
Adopt rules for inspections and permits for minimum fire and life safety requirements and establish fees for such inspections and permits for mobile homes entering this state.
Adopt such other rules as the board deems necessary for the department to carry out this chapter and, to the extent not authorized by other provisions of this section, adopt rules as necessary to interpret, clarify, administer or enforce this chapter.
Adopt rules relating to the installation of manufactured homes, mobile homes, factory-built buildings and accessory structures included as part of a sales contract for a used mobile home, new or used manufactured home or new or used factory-built building or part of an agreement to move a used mobile home, new or used manufactured home or new or used factory-built building. This paragraph does not apply to:

(a) Single wide factory-built buildings that are used for construction project office purposes and that are not used by the public.

(b) Storage buildings of less than one hundred sixty-eight square feet that are not used by the public.

Adopt rules relating to acceptable workmanship standards.
Adopt rules relating to issuing permits to licensees, owners of units or other persons for the installation of manufactured homes, mobile homes, factory-built buildings and accessory structures.
Adopt rules including a requirement that a permit shall be obtained before the installation of a mobile or manufactured home.
Establish standards for the permanent foundation of a manufactured home, mobile home or factory-built building.

B. In adopting rules pursuant to subsection A, paragraph 3 of this section, the board shall consider for adoption any amendments to the codes and standards referred to in subsection A, paragraphs 1 and 2 of this section. If the board adopts the amendments to such codes and standards, the department shall notify the manufacturers licensed pursuant to article 4 of this chapter ninety or more days before the effective date of such amendments.

C. Chapter 6 of this title does not apply to the setting of fees under subsection A, paragraph 4 of this section.

D. Rules adopted pursuant to subsection A, paragraph 14 of this section shall be standard throughout this state and may be enforced by the local enforcement agencies on installation to ensure a standard of safety. The board may make an exception to the standard if, on petition by a local jurisdiction participating in the installation inspection program, local conditions justify the exemption or it is necessary to protect the health and safety of the public. On its own motion, the board may revise or repeal any exception.

Article 4 Office of Administration

§ 41-4023 General powers and duties

The director shall appoint the deputy director who shall, under the authority and direction of the director:

Establish licensing and regulation procedures in accordance with this article and issue certification documents for compliance with the licensing and bonding requirements of this article.
Issue certificates to indicate compliance with the construction requirements of article 3 of this chapter.
Provide for investigative support, enforcement, penalty procedures, hearings and rehearings in accordance with this chapter.
Establish field offices for the department as required.
Issue permits to licensees, owners of units and other persons for the installation of manufactured homes, mobile homes and factory-built buildings and the rehabilitation of mobile homes.

§ 41-4025 Qualifications and requirements for licensure

A. A manufacturer, dealer, broker, salesperson or installer license shall be issued by the director.

B. The director shall:

Qualify applicants for a license.
Conduct investigations as the director deems necessary.
Establish and administer written examinations for the applicable license classifications.

C. The director may establish experience requirements for installers of manufactured homes, mobile homes, factory-built buildings and accessory structures.

D. To obtain a license pursuant to this article, the applicant shall submit to the director a notarized application on forms prescribed by the department together with the required license fee. The application shall contain the following information:

A designation of the classification of license sought by the applicant.
The name, birth date and address of an individual applicant.
If the applicant is a partnership, the name, birth date and address of all partners with a designation of any limited partners.
If the applicant is a corporation, association or other organization, the names, birth dates and addresses of the president, vice president, secretary and treasurer.
For all licenses, except those for salespersons, the name, birth date and address of the qualifying party. The qualifying party must reside within the state of the principal place of the licensee's business and shall not act in the capacity of a qualifying party for more than one license in the same classification.
If the applicant is a corporation, association or other organization, evidence that the corporation, association or other organization is in good standing with the Arizona corporation commission.
Whether the owner, if the applicant is a sole proprietorship, all partners, if the applicant is a partnership, all officers, if the applicant is a corporation or other type of association, the managers or managing members, if the applicant is a limited liability company, the general partner, if the applicant is a limited partnership, or the individual, if the applicant is a salesperson, has ever been charged or convicted of a felony, or has ever received an adverse final decision in a civil action alleging fraud or misrepresentation and, if so, the nature of the action and the final disposition of the case.
For corporations, the name and address of a statutory agent who is appointed by the licensee on whom legal notices, summonses or other processes may be served, which service shall be deemed personal service on the licensee.
If it is an application for a salesperson's license, the applicant shall designate an employing dealer or broker and shall include the signature of the qualifying party or the qualifying party's designee.
Other information as the director may deem necessary.

E. Before receiving and holding a license issued pursuant to this article, the owner, if the applicant is a sole proprietorship, all partners, if the applicant is a partnership, the general partner, if the applicant is a limited partnership, the president, vice president, secretary and treasurer, if the applicant is a corporation or other type of association, the manager or managing members, if the applicant is a limited liability company, the individual, if the applicant is a salesperson, and the qualifying party shall submit a valid fingerprint clearance card issued pursuant to section 41-1758.03. The applicant is responsible for providing the department with a valid fingerprint clearance card.

F. The department shall not issue a license to an applicant before receiving a valid fingerprint clearance card pursuant to this section. The department shall suspend the license if the fingerprint clearance card is determined to be invalid and an applicant who was issued a license fails to submit a new fingerprint clearance card within ten days after being notified by the department. This section does not affect the department's ability to otherwise issue, deny, cancel, terminate, suspend or revoke a license.

G. To obtain a license pursuant to this article, a person shall not have had a license refused or revoked within one year before the date of the application, shall not have engaged in the business without first having been licensed and shall not act as a licensee between the filing of the application and actual issuance of the license. For the purposes of this subsection, "person" means an applicant, an individual, a qualifying party, any partner of a partnership, any manager or managing member of a limited liability company, or any officer, director, qualifying party or owner of forty percent or more of the stock or beneficial interest of a corporation.

H. Before issuance of a dealer, broker or installer license, the qualifying party, in addition to meeting the requirements provided in subsection D of this section, shall successfully show, by written examination within three attempts, qualification in the kind of work or business in which the applicant proposes to engage. Before the issuance of an installer license, the qualifying party shall also provide the department with evidence of successful completion of the online installer course that is administered by the manufactured housing educational institute and proof of three years of practical or field experience or training that is deemed acceptable by the department.

I. A license shall not be issued to a minor or to any partnership in which one of the partners is a minor.

J. Every salesperson who holds an active license shall maintain on file with the department a current residence address and shall notify the department within five working days of any change of address, of any discontinued employment, and where, if anywhere, the salesperson is currently working.

K. The license of a salesperson who is no longer employed by the dealer of record is deemed inactive. The salesperson shall turn the license into the department until the salesperson is employed by another dealer and a written notification of the change has been received by the department. On notification, the department shall return the license to the salesperson.

§ 41-4026 Issuance of a license

A. On receipt by the director of the nonrefundable fee required by this article and an application furnishing complete information as required by the director and on the applicant taking and passing the applicable examination required by section 41-4025, the director shall issue a conditional license to the applicant, pending completion of the background analysis, allowing the applicant to engage in business pursuant to this article for one year.

B. The agreement for conditional license does not prohibit the applicant from making a written demand for a hearing on the order of revocation pursuant to chapter 6, article 10 of this title. Pending the hearing, the applicant shall not continue to transact business under the conditional license.

C. Depending on the results of the background analysis, the director may either revoke the conditional license or deem the license as granted without further condition.

D. License certificates issued pursuant to this article shall be signed by the director or the director's designated representative. The license is nontransferable and satisfactory evidence of the possession shall be exhibited by the licensee on demand. The license held by the licensee shall be posted in a conspicuous place on the premises where any business is being performed. The license number shall be written on any contract entered into by the licensee.

E. If an application for a license is denied or if the applicant fails to supply complete and correct required information within ninety days or fails to pass the required written examination within ninety days after filing or if an application for renewal is not completed by the expiration date or if any applicant requiring examination after having been notified by letter of the date to appear fails to appear for the examination within ninety days from the date of filing the application, the fee paid by the applicant on filing the application is forfeited and the application is terminated. A reapplication for a license shall be accompanied by the fee prescribed by the director.

F. If, before the issuance of the license, information brought to the attention of the director concerning the qualifications of the applicant is such that in the director's discretion it may be proper to deny the license, the director may notify the applicant that the license is denied and that the applicant may request in writing a hearing if the applicant so desires.

G. The licensee may not engage in the sale of units, either new or used, unless the licensee maintains an office where the records are available for inspection and the location is listed on the license application as the principal place of business.

§ 41-4027 Renewal of licenses; license status

A. Licenses issued under this article shall expire one year after the date of issuance. An application for renewal of any current license with evidence of a valid bond or cash deposit when accompanied by the required fee and received by the director before the expiration date shall authorize the licensee to operate until actual issuance of the renewal license for the ensuing year.

B. A license that expires may be reactivated and renewed within one year of its expiration by filing the required renewal application, signed by the licensee or qualifying party for a business licensee, evidence of a valid bond and payment of a fee of one hundred twenty-five percent of the amount required for that license class. When a license has been expired for more than one year for failure to renew, a new application for license shall be made and a new license issued pursuant to this article. If the license has been expired for more than one year, the fee required shall be two hundred percent of the fee required for that license class.

C. An applicant for renewal of a license issued pursuant to this article shall not be required to take a written examination.

D. A license is not transferable. Any change in the legal entity of a licensee that includes any change in the ownership of a sole proprietorship or a partner of a partnership or in the creation of a new corporate entity requires a new license.

E. A license may be canceled on the written request of the owner of a sole proprietorship, a partner of a partnership or, in the case of a corporation or a limited liability corporation, any person with written evidence of his authority to request the cancellation. A salesperson's license may be canceled on the written request of the salesperson. The director may refuse to accept voluntary cancellation of a license if good cause may exist for disciplinary action.

F. If possible, the licensee shall notify the director in writing of the disassociation of a qualifying party before the action, and in any event no later than five business days after the action. The licensee shall also notify the director as to who will be temporarily responsible for the operation of the business. The absence of a written designated qualifying party for sixty days is grounds for suspension of the license. If a person ceases to be the qualifying party for a licensee, the person shall notify the department within five days.

G. An application for a new qualifying party shall include the completion of the prescribed forms, fingerprints and testing, if applicable, in accordance with sections 41-4025 and 41-4026.

H. A licensee may request the director, on forms prescribed by the director, to inactivate the licensee's current license for a period of not more than two years. In the absence of any disciplinary proceeding or disciplinary suspension and on payment of reasonable fees determined by the board the director may issue an inactive license certificate to the licensee if the licensee has turned in his license. The inactive license certificate may consist of an endorsement on the licensee's license stating that the license is inactive. The director may not refund any of the license renewal fee which a licensee paid before requesting inactive status. A licensee's license that is not suspended or revoked and is inactive shall be reactivated as an active license on payment of the current year's renewal fee and thirty days' written notice to the director. An examination may not be required to reactivate an inactive license. If the license is not reactivated within two years, a new application for licensing must be made and the new license issued pursuant to this chapter. A licensee may not inactivate the license more than once. The holder of an inactive license shall not work as a licensee until the licensee's license is reactivated as an active license. The inactive status of a licensee's license does not bar any disciplinary action by the director against a licensee for any of the grounds stated in this chapter.

§ 41-4028 Exemptions

A. Any person who is engaged in installing manufactured homes, mobile homes or accessory structures and who is licensed in an appropriate category by the registrar of contractors pursuant to title 32, chapter 10, article 2 is exempt only from the licensing requirements of this article.

B. The requirements of this chapter applicable to dealers do not apply to persons performing the following transactions:

A person who is licensed pursuant to title 32, chapter 20 and who is engaged in activities proscribed by this chapter with respect to any of the following:

(a) New or used manufactured homes, mobile homes or factory-built buildings if the manufactured home, mobile home or factory-built building is listed in a contract for transfer of an interest in real property executed by its owner and is installed on the real property.

(b) New or used manufactured homes and mobile homes that are located in mobile home parks as defined in section 33-1409 if the person who is licensed pursuant to title 32, chapter 20 is acting as an agent for a licensed manufactured housing dealer and the dealer is responsible for filing all of the required paperwork and submitting the required fees on the sale of the home pursuant to this chapter.

(c) Used manufactured homes and mobile homes that are located in mobile home parks as defined in section 33-1409 if the person who is licensed pursuant to title 32, chapter 20 is acting on behalf of a private party and the real estate broker or real estate salesman remains subject to the real estate licensure requirements prescribed in title 32, chapter 20.

(d) New manufactured homes if the person who is licensed pursuant to title 32, chapter 20 is acting as an agent for a licensed manufactured housing dealer and the dealer is responsible for filing all of the required paperwork and submitting the required fees on the sale of the home pursuant to this chapter.

Receivers, trustees, administrators, executors, guardians or other persons who are appointed by or acting under the judgment of any court.
Public officers while performing their official duties.
Banks and other financial institutions, and their subsidiaries, and other corporations qualified to do business in this state, if they are proceeding as repossessors or liquidators, but only to the extent that they finance the sales transaction by which the repossessed property is liquidated or are a holder in due course with respect to the transaction.
A purchaser who sells not more than two factory-built buildings, manufactured homes or mobile homes in any twelve-month period.

C. For the purposes of this section, a manufactured home, mobile home or factory-built building is used if it has been occupied for at least thirty consecutive days for its intended use or function by a bona fide homeowner, renter or other end user.

§ 41-4029 Bonds and cash deposits; requirements; fund

A. Before granting an original license, the director shall require of the applicant, except an applicant for salesperson or broker of manufactured homes or mobile homes, a surety bond in a form acceptable to the director or a cash deposit pursuant to this section. A separate bond or cash deposit shall be required for each branch location of any licensed manufacturer or installer. A license shall not be renewed unless the applicant's surety bond or cash deposit is in full force and effect. A change of location of a licensee's principal place of business requires a rider or endorsement to the existing bond and payment of the administrative function fee. The rider or endorsement shall indicate the new location and acceptance of claims for the previous location.

B. The bonds or cash deposit shall be in amounts prescribed by the board.

C. The surety bonds shall be executed by the applicant as principal with a corporation duly authorized to transact surety business in this state. Evidence of a surety bond shall be submitted to the director in a form prescribed by the director. The applicant may in the alternative establish a cash deposit in the amount of the bond with the state treasurer pursuant to the rules adopted by the director. The bond funds shall be deposited, pursuant to sections 35-146 and 35-147, in a special account to be known as the consumer recovery fund. The state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund. The cash deposits may be withdrawn, if there are no outstanding claims against them, two years after the termination of the license in connection with which the cash is deposited. The cash deposit may be withdrawn two years after the filing of a commercial surety bond as a replacement to the cash deposit.

D. The bond or deposit required by this section shall be in favor of the state for the benefit of any person covered by this subsection. The bond or deposit shall be subject to claims by:

Any consumer of a unit regulated by this chapter who enters into an agreement with any licensee, except a salesperson or broker of manufactured homes or mobile homes, and who is damaged by the failure of the principal to perform a sales or installation agreement or to perform repairs under a warranty.
The director, if the principal fails to pay any of the fees or costs that the principal owes the department.

E. Any person claiming against the bond or deposit, except the department, may maintain an action against the principal and the surety. The principal's bond or deposit may be sued on in successive actions until the full amount is exhausted. A suit may not be commenced on the bond or deposit after the expiration of two years after the date of sale or installation of the unit, whichever is later, on which the suit is based, except that the time for purposes of the claim for fraud shall be measured pursuant to section 12-543.

F. The surety bond or deposit shall be continuous in form and shall contain the condition that the total aggregate liability of the surety or depository for all claims shall be limited to the face amount of the bond or depository irrespective of the number of years the bond or depository is in force. If the corporate surety desires to make payment without awaiting court action, the amount of the bond filed shall be reduced to the extent of any payment or payments made by the corporate surety in good faith. Any such payments shall be based on priority of written claims received by the corporate surety before court action. The surety bond or depository shall be continuous as long as the corporate surety or the depositor maintains the face amount of the bond or deposit. Failure to maintain the face amount of the bond or deposit constitutes a suspension of the license until the face amount of the bond or deposit is restored.

G. The corporate surety shall notify the director of the intent of the principal to cancel the bond and of any monies paid from the bond. On receipt by the director of notice to cancel a bond by any corporate surety, the director shall immediately notify the licensee who is the principal on the bond of the effective date of cancellation of the bond and that the licensee shall furnish a like bond or make cash deposit on or before the effective date of cancellation or the license shall be suspended. Notice to the licensee shall be by certified mail postage fully prepaid, addressed to the licensee's last address of record with the department. The license shall be suspended on the date the bond is canceled unless a replacement bond or cash deposit in lieu of a bond is on file with the director.

H. The director shall have no personal liability for the performance of duties relating to the bond and cash deposit requirements of this section if such duties are performed in good faith.

§ 41-4030 Trust and escrow requirements for dealers that are not also owners of mobile home parks; rules; exemptions

A. Each dealer licensed pursuant to this article shall establish an independent escrow account with an independent financial institution or escrow agent authorized to handle such an account in this state as prescribed by title 6, chapter 7 or 8 for each transaction involving:

A new manufactured home.
A new factory-built building designed for use as a residential dwelling.
A manufactured home, mobile home or factory-built building designed for use as a residential dwelling that is previously owned and that has a purchase price of $50,000 or more.

B. For the purposes of subsection A of this section, a financial institution or escrow agent is independent if the individual or entity is not controlled by the licensee, a family member of the licensee or a business affiliated with the licensee and the licensee, family member or business affiliate does not have a majority interest in the financial institution or escrow agent.

C. Each dealer that sells new manufactured homes or factory-built buildings designed for use as residential dwellings or a manufactured home, mobile home or factory-built building designed for use as a residential dwelling that is previously owned and that has a purchase price of less than $50,000 shall maintain a licensee's trust account or open an escrow account with an independent financial institution or escrow agent located in this state and shall deposit all earnest monies received for the sale of manufactured homes, mobile homes or factory-built buildings designed for use as residential dwellings in that account. The department shall conduct an audit of each dealer's trust or escrow account, including any transactions with an independent escrow account, at least once every two years. A purchaser of a mobile home, used manufactured home or used factory-built building designed for use as a residential dwelling may request that the dealer establish an independent escrow account and if such a request is made in writing not later than the time the purchase contract is signed, and the seller consents, the dealer shall comply with this subsection by complying with subsection A of this section. A licensee that handles a transaction under this subsection shall disclose to the purchaser, in writing and before or at the time the purchaser signs the purchase contract, that the purchaser may request in writing the use of an independent escrow account, and that the transaction will otherwise be handled through a trust account controlled by the licensee.

D. All dealers shall notify the director in writing when the trust or escrow account has been established by indicating the name and number of the account and the name and location of the financial institution used.

E. The dealer, in writing, shall authorize the depository to release any and all information relative to trust or escrow accounts to the director or the director's agent, employee or deputy.

F. The dealer's earnest monies receipt book shall reflect all earnest monies received and shall be at the minimum in duplicate and consecutively numbered.

G. All earnest monies shall be deposited in the escrow account or trust fund account not later than the close of the second banking business day after receipt.

H. The terms or instructions for any escrow account opened under subsection A or C of this section are deemed to be enforceable as part of the purchase contract. All parties to the purchase contract and the licensee shall sign the terms and instructions. If practicable, the escrow terms or instructions shall be included in the purchase contract or stated in an addendum to the purchase contract. The licensee shall provide a copy of the purchase contract to the escrow agent even if the escrow terms or instructions are contained in a separate document. The licensee shall promptly provide the escrow account information to all parties to the purchase contract once the account is opened.

I. At a minimum, the escrow terms or instructions shall contain:

Identification of the escrow agent with information containing at least the name, address and telephone number of the escrow agent.
All conditions or requirements that affect or pertain to closing the escrow account and disbursement of the monies in the escrow account.
Any conditions or requirements where monies are to be disbursed from the escrow account in advance of the escrow account being closed.
Any conditions or requirements where additional monies or documents must be deposited with an escrow agent after the escrow account is opened.

J. A dealer or broker may deposit and maintain up to $200 in the trust account to offset service charges that may be assessed by the financial institution.

K. Every deposit into a trust account shall be made with a deposit slip that identifies each transaction as follows:

The amount of deposit.
The names of all parties involved in the transaction. All receipts for monies deposited in escrow shall be made accountable by containing the same information.

L. A complete record shall be retained by the dealer's or broker's office of all earnest monies received. The record shall contain provisions for entering:

The amount received.
From whom the monies were received.
The date of receipt.
The place of deposit.
The date of deposit.
The daily balance of the trust fund account deposit of each transaction.
When the transaction has been completed.
The date and payment for all goods and services the dealer has contracted to provide.

M. All earnest monies deposited in the trust or escrow account shall be held in such account until one of the following is completed:

The consummation of sale.
The termination of sale, including a complete accounting of all monies.

N. On completion pursuant to subsection M of this section, the earnest monies deposit shall be conveyed to the lending institution or the dealer, purchaser, seller, manufacturer or lienholder, whichever is applicable.

O. The dealer shall retain true copies of the purchase agreements, earnest monies receipts, depository receipts, evidence of delivery documents and evidence of consummation of sale or termination of sale for a period of three years.

P. The deposits referred to in this section shall not be used for any purpose other than the transaction for which they were provided.

Q. Notwithstanding any other provision of this section and except that this subsection does not apply to an independent escrow account established pursuant to subsection A of this section, before an event listed under subsection M of this section is completed, a licensed dealer may release trust account earnest monies to pay for flooring or inventory for the unit that is the subject of the transaction for which the earnest monies were provided. A licensed dealer may release trust account earnest monies to pay other lawfully imposed interim loan amounts and charges imposed by a financial institution or other bona fide lender on the unit that is the subject of the transaction for which the earnest monies were provided. The dealer shall not make any payment out of trust account monies pursuant to this subsection unless done in compliance with all of the following:

The payment is made not more than ten business days before the completion date pursuant to subsection M of this section.
The payment is made directly to the financial institution or other bona fide lender.
The payment is recorded in the dealer's records under this section and documented by a receipt, a payment record or any other evidence from the financial institution or lender.
If the transaction is terminated, the dealer replaces the amount of the payment in the trust account within three business days after receiving written notification of the termination.

This subsection does not affect any other rights or obligations between the purchaser and the licensed dealer.

R. The board shall adopt separate rules for dealer trust and escrow accounts trust and escrow accounts. At a minimum, these rules shall contain trust and escrow account requirements for the following:

Recordkeeping.
Administration.
Service fees or charges.
Deposits.
Advances or payments out of trust and escrow accounts.
Closing or termination of sales transactions.
Auditing or investigation of trust or escrow account complaints.

S. This section shall not apply to a real estate broker or salesperson licensed pursuant to section 32-2122 and pursuant to this article when the unit is sold in conjunction with real estate.

§ 41-4030.01 Trust and escrow requirements for dealers that are also owners of mobile home parks; rules

A. The owner of a mobile home park that also is or that owns a dealership licensed pursuant to this article to sell units may sell a manufactured home, mobile home or a factory-built building designed for use as a residential dwelling as a licensee if all of the following apply:

The home will be sited in a mobile home park that is owned by the park owner.
At the time of the sale, the park owner has on file at the department the name and address of all mobile home parks owned by the park owner, the name, address and license number of the licensed dealership and documentation showing to the satisfaction of the department that the park owner either holds the license, owns a majority interest in the license or is controlled by an entity that holds a controlling interest in the license.
At the time of the sale, the licensed dealership has posted with the department a dealer bond in an amount of at least $150,000 in a form satisfactory to the department covering sales by parks sharing common control.
At the time of the sale, the dealer shall either maintain a licensee's trust account or open an escrow account with an independent financial institution or escrow agent located in this state. The licensee shall deposit all earnest monies received for the sale of manufactured homes, mobile homes or factory-built buildings designed for use as residential dwellings in the trust or escrow account. The department shall conduct an audit of each dealer's trust or escrow account, including any transactions with an independent escrow account, at least once every two years. The purchaser of the manufactured home, mobile home or factory-built building designed for use as a residential dwelling may make a written request that the dealer establish an independent escrow account and if such a request is received by the dealer no later than the time the purchase contract is signed and the seller consents, the dealer shall comply with the request. A licensee that handles a transaction under this paragraph shall disclose to the purchaser, in writing and before or at the time the purchaser signs the purchase contract, that the purchaser may request in writing the use of an independent escrow account and that the transaction will otherwise be handled through a trust account controlled by the licensee.

B. For the purposes of this section, a financial institution or escrow agent is independent if the individual or entity is not controlled by the licensee, a family member of the licensee or a business affiliated with the licensee and the licensee, family member or business affiliate does not have a majority interest in the financial institution or escrow agent.

§ 41-4031 Complaints; citation; failure to respond

A. The department shall issue a citation on failure to respond or on the verified written complaint of a purchaser pursuant to section 41-4004, subsection A, paragraph 9 and shall issue a citation directing the licensee, within ten days after service of the citation on the licensee, to appear by filing with the department a verified answer to the complaint showing cause why the license should not be revoked or suspended. The director, after conducting an investigation pursuant to section 41-4039, may issue a citation on the director's own initiative.

B. Failure of the licensee to answer shall be deemed an admission by the licensee of the cited complaint or failure to respond as charged in the citation, and the department may suspend or revoke such license without a hearing.

§ 41-4032 Cosmetic complaints; process; walk-through; definition

A. Notwithstanding sections 41-4004 and 41-4031, a purchaser of a new manufactured home shall file a complaint concerning cosmetic, superficial or minor matters relating to the manufactured home no more than one hundred twenty days after the date of installation or the designated cosmetic complaint date prescribed in section 41-4033.

B. The director shall not process or verify a complaint described in subsection A of this section if the complaint is filed more than one hundred twenty days after the date of installation or the designated cosmetic complaint date prescribed in section 41-4033, unless the director finds, after written notice to the interested parties, that the complaint involves major or structural matters relating to the manufactured home.

C. The board shall adopt rules establishing procedures for complaints filed pursuant to this section, including rules for determining the date of installation of a new manufactured home.

D. This section does not apply if, within thirty days after the date of installation or the designated cosmetic complaint date prescribed in section 41-4033, the manufacturer or dealer of the new manufactured home has not conducted a walk-through of the home with the purchaser or the purchaser's representative and has not completed a walk-through checklist on a form approved by the board. The walk-through checklist form shall contain a notice to the purchaser, located immediately above the signature lines and in bold print, advising the purchaser that all cosmetic, superficial or minor matters found during the walk-through should be listed on the form and that the complaint filing period for cosmetic, superficial or minor matters is one hundred twenty days from either the date of installation of the home or the designated cosmetic complaint date prescribed in section 41-4033.

E. For the purposes of this section, "cosmetic, superficial or minor matters" means any defect or condition that renders a part of the home not fit for its intended, expected or ordinary use or appearance, including defects or conditions that involve the appearance of the home's structural, electrical, plumbing, mechanical or gas systems. Cosmetic, superficial or minor matters do not include defects or conditions involving the performance of the home's structural, electrical, plumbing, mechanical or gas systems.

§ 41-4033 Purchaser designation; cosmetic complaint date

A. At the time of execution of the purchase contract a purchaser of a new manufactured home may designate the beginning date for the one hundred twenty day cosmetic complaint period.

B. The purchaser may not take possession of the home or move into the home before the designated beginning date for the cosmetic complaint period unless the dealer consents in writing.

C. The purchaser may change the designated beginning date for the cosmetic complaint period by sending a written notice by certified mail to the dealer who is listed on the purchase contract. The purchaser shall mail the written notice before the designated beginning date.

D. If the purchaser designates a beginning date for the cosmetic complaint period, the dealer may schedule the walk-through pursuant to section 41-4032 at any time within thirty days after the designated beginning date. The dealer shall notify the purchaser by certified mail of the scheduled walk-through date.

E. If a dealer uses a form of purchase contract that does not notify the customer of the right to designate a cosmetic complaint date and does not include a space for this designation, the one hundred twenty day complaint period prescribed in section 41-4032 does not begin until the purchaser physically occupies the home with the purpose of residing in the home for more than thirty days.

§ 41-4034 Drywall cracks; repair process; supplied paint

A. Drywall cracks that are a result of structural problems are not cosmetic, superficial or minor matters as defined in section 41-4032. Drywall cracks may be addressed in conjunction with the correction of the structural problem.

B. Drywall cracks that are not the result of structural problems are considered cosmetic, superficial or minor matters as defined in section 41-4032. Drywall cracks that are found during the walk-through may be included in the cosmetic complaint process and repaired by the dealer or manufacturer at the same time as all other cosmetic complaints. The purchaser may seek repair of or may complain about additional drywall cracks once before the end of the twelve month regular complaint period, and the dealer or manufacturer shall make one repair.

C. At the time of installation or at the time of the walk-through, the dealer or manufacturer shall supply the purchaser with two gallons of paint to match each interior color from the manufacturer's order.

§ 41-4035 Walk-through and complaint process

A. The purchaser and the dealer or manufacturer of the manufactured home shall schedule the walk-through pursuant to section 41-4032 by mutual agreement to the greatest extent possible. If the parties do not agree, the dealer or manufacturer may schedule the walk-through between fifteen and thirty days after the date of installation. The dealer or manufacturer shall notify the purchaser by certified mail of the time of the walk-through.

B. If a dealer or manufacturer schedules a walk-through without mutual agreement with the purchaser or pursuant to section 41-4033, the purchaser and the dealer or manufacturer may mutually agree to a revised date before the scheduled date. The revised date shall be no more than sixty days after the date of installation or the designated beginning date for the cosmetic complaint period.

C. If a purchaser or the purchaser's representative fails or refuses to attend a scheduled walk-through, the dealer or manufacturer shall note the purchaser's failure to attend on the checklist form and proceed with the walk-through. The dealer or manufacturer shall send a copy of the completed checklist form by certified mail to the purchaser within five business days after the walk-through date.

§ 41-4036 Repairs; complaints

A. Within ninety days after the end of the cosmetic complaint period the dealer or manufacturer shall repair or replace cosmetic, superficial or minor matters discovered on the walk-through unless an item necessary for the repair or replacement is unavailable and written notice of that fact is provided to the purchaser.

B. For cosmetic, superficial or minor matters found after the walk-through and before the one hundred twenty-day deadline, the purchaser shall notify the dealer in writing before a complaint may be filed, except if there are extenuating circumstances, such as serious illness, incapacity or death. The dealer or manufacturer shall replace or repair these items within ninety days after the end of the cosmetic complaint period.

C. The board shall adopt rules establishing procedures for scheduling repair and replacement of complaint items.

D. The purchaser may file a complaint with the department on matters covered by this section if the complaint is filed within the twelve-month period prescribed by sections 41-4004 and 41-4031 and the licensee failed to repair or replace the items within the repair and replacement period or the repair or replacement does not comply with adopted codes or workmanship standards.

§ 41-4037 Hearing; representation

In a hearing conducted pursuant to this article, a corporation may be represented by a corporate officer or employee who is not a member of the state bar if:

The corporation has specifically authorized the officer or employee to represent it.
The representation is not the officer's or employee's primary duty to the corporation but is secondary or incidental to the officer's or employee's duties relating to the management or operation of the corporation.

§ 41-4038 Rehearing

A. Any party may apply for a rehearing by filing with the director a motion pursuant to chapter 6, article 10 of this title.

B. The filing of a motion for rehearing shall suspend the operation of the administrative law judge's action, except for an action which upholds a cease and desist order, and permits the licensee or the person who was issued a citation to continue to do business pending denial or granting of the petition. If the motion is granted, the administrative law judge's action is suspended pending the decision of the director upon the rehearing.

C. In the order granting or denying a rehearing, the director shall include a statement of the particular grounds and reasons for the director's action on the petition and shall promptly mail a copy of the order to the parties who have appeared in support of or in opposition to the petition for rehearing. If a rehearing is granted, the administrative law judge shall set the matter for further hearing on due notice to the parties. After submission of the matter upon rehearing, the administrative law judge shall render a decision in writing and give notice of the decision in the same manner as of a decision rendered upon an original hearing.

D. A rehearing may be granted for any of the following reasons materially affecting the moving party's rights:

Irregularity in the proceedings before the director, or any order or abuse of discretion which deprived the moving party of a fair hearing.
Misconduct by the director, the director's employees or the administrative law judge.
Accident or surprise that could not have been prevented by ordinary prudence.
Newly discovered material evidence that could not with reasonable diligence have been discovered and produced at the original hearing.
Excessive or insufficient penalties.
Error in the admission or rejection of evidence or other errors of law occurring at the hearing.
That the decision is not justified by the evidence or is contrary to law.

E. If an order denying a rehearing or a decision given upon a rehearing results in immediate suspension or revocation of a license, then operation of such order or decision shall be suspended until ten days after service of notice of the suspension or revocation.

F. In a rehearing pursuant to this section, a corporation may be represented by a corporate officer or employee who is not a member of the state bar if:

The corporation has specifically authorized the officer or employee to represent it.
The representation is not the officer's or employee's primary duty to the corporation but is secondary or incidental to the officer's or employee's duties relating to the management or operation of the corporation.

§ 41-4039 Grounds for disciplinary action

The director may, on the director's own motion, and shall, on the complaint in writing of any person, cause to be investigated by the department the acts of any manufacturer, dealer, broker, salesperson or installer licensed with the department and may temporarily suspend or permanently revoke any license issued under this article, impose an administrative penalty or place on probation any licensee, if the holder of the license, while a licensee, is guilty of or commits any of the following acts or omissions:

Failure in any material respect to comply with this article or article 3 of this chapter.
Violation of any rule that is adopted by the board and that pertains to the construction of any unit or of any rule that is adopted by the board and that is necessary to effectively carry out the intent of this article, article 3 of this chapter or the laws of the United States or of this state.
Misrepresentation of a material fact by the applicant in obtaining a license.
Aiding or abetting an unlicensed person or knowingly combining or conspiring with an unlicensed person to evade this article or article 3 of this chapter, or allowing one's license to be used by an unlicensed person or acting as an agent, partner or associate of an unlicensed person with intent to evade this article or article 3 of this chapter.
Conviction of a felony.
The doing of a wrongful or fraudulent act by a licensee that relates to this article or article 3 of this chapter, including failure to comply with section 41-4030, subsection A, or the doing of any other wrongful or fraudulent act in conjunction with the sale, transfer or relocation of a mobile home in this state.
Departure from or disregard of any code or any rule adopted by the board.
Failure to disclose or subsequent discovery by the department of facts that, if known at the time of issuance of a license or the renewal of a license, would have been grounds to deny the issuance or renewal of a license.
Knowingly entering into a contract with a person not duly licensed in the required classification for work to be performed for which a license is required.
Acting in the capacity of a licensee under any license issued under this article in a name other than as set forth on the license.
Acting as a licensee while the license is under suspension or in any other invalid status.
Failure to respond relative to a verified complaint after notice of such complaint.
Violation of title 28, chapter 10 or rules adopted pursuant to title 28, chapter 10, except for the licensing requirements of sections 28-4334, 28-4335, 28-4361, 28-4362, 28-4364, 28-4401 and 28-4402.
False, misleading or deceptive sales practices by a licensee in the sale or offer of sale of any unit regulated by this article or article 3 of this chapter.
Failure to remit the consumer recovery fund fee pursuant to section 41-4042.
Acting as a salesperson while not employed by a dealer.
As a salesperson, representing or attempting to represent a dealer other than by whom the salesperson is employed.
Acting beyond the scope of activity authorized by the salesperson's license classification of the employing dealer.
Failure by a salesperson to promptly place all cash, checks and other items of value and any related documents received in connection with a sales transaction in the care of the employing dealer.
Failure to provide all agreed on goods and services.
Failure to manufacture or install in a workmanlike manner all units and accessory structures that are suitable for their intended purpose.
Failure of the licensee to work only within the scope of the license held.
An action by a licensee, who is also a mobile home park owner, manager, agent or representative, that restricts a resident's or prospective resident's access to buyers, sellers or licensed dealers or brokers in connection with the sale of a home or the rental of a space, that the department finds constitutes a violation of section 33-1434, subsection B or section 33-1452, subsection F or that violates any law or regulation relating to fair housing or credit practices.

§ 41-4040 Reports by dealers to department of revenue and county assessor

A. Every dealer who acquires or sells a previously titled manufactured home or mobile home, as defined in section 42-19151, shall submit a written report of all such acquisitions and sales to the department of revenue and to the county assessor of the county where such dealer is located. Such report shall be submitted by the fifteenth day of each month for the period of the previous calendar month and shall include:

The manufacturer, brand name or model, size, factory list price, total selling price and serial number of such manufactured home or mobile home.
The name and address of the person from whom such manufactured home or mobile home was acquired and the last previous location of such manufactured home or mobile home.
The name and address of the person to whom such manufactured home or mobile home was sold.
The new location of such manufactured home or mobile home if such location is known to the dealer.

B. Every dealer shall comply with the reporting provisions of this section. The information required in subsection A of this section shall be forwarded by dealers of manufactured homes and factory-built buildings to the department by the fifteenth day of the month after the reporting period or a statement that no sales have occurred for that month.

C. Each dealer of manufactured homes shall also make and maintain the records and make the reports required pursuant to this article.

D. Before the sale of a manufactured home each dealer shall convey notice in writing to the prospective buyer that the utility service facilities for manufactured home spaces are not standardized and compatibility between a chosen manufactured home space and a manufactured home to be purchased is the buyer's responsibility. Before the sale of a used manufactured home each dealer shall notify the prospective buyer in writing of the existence and amount of any tax lien on record against the unit.

E. The dealer shall provide a notification form to the buyer, as approved by the board, part of which shall contain the buyer's signature and other information to be completed by the dealer that when forwarded to the department constitutes compliance with the reporting requirements of subsection B of this section.

§ 41-4041 Consumer recovery fund

A. The consumer recovery fund is established. The director shall administer the fund.

B. On notice from the director, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. The monies earned from investment may be used for the same purposes as all other monies deposited in the fund.

D. Recovery from the consumer recovery fund is limited to actual or compensatory damages, including costs but excluding interest or attorney fees.

E. Recovery from the consumer recovery fund is not limited by the consumer's right, if any, to also claim against a holder of a retail sales contract or promissory note that is secured by the property that is the subject matter of the claim.

§ 41-4042 Funding and assessments

A. A dealer of manufactured homes, mobile homes or factory-built buildings designed for use as residential dwellings shall pay, in addition to the license or renewal fee, a fee established by the director of not to exceed $50 for each unit that is sold and that is subject to section 41-4030, subsection C, for deposit into the consumer recovery fund. The fee is payable to the department by the fifteenth day of the month following the month in which the sale is consummated.

B. Chapter 6 of this title does not apply to the setting of fees under this section.

C. An amount not to exceed seventy-five percent of the previous fiscal year's interest earned on the consumer recovery fund may be expended by the director, with the approval of the board. The expenditure shall be used for consumer and licensee education in connection with the manufactured housing and factory-built building industry, and all monies up to a maximum of $50,000 remaining unexpended and unencumbered at the end of each fiscal year may be used for consumer and licensee education in succeeding fiscal years and do not revert to the consumer recovery fund.

§ 41-4043 Recovery from fund; claim against licensee; subrogation; appeal; statute of limitations

A. If any consumer who is buying or selling the consumer's home uses the services of a licensed dealer of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings and is damaged as a result of an act or omission by a licensed dealer of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings that constitutes a violation of section 41-4030, or rules adopted pursuant to that section, and the sale is subject to section 41-4030, subsection C, that consumer may file a claim with the department for payment from the consumer recovery fund. The claim shall be verified by the department.

B. If any consumer of manufactured homes, mobile homes or factory-built buildings designed for use as residential buildings is damaged by the failure of the principal to perform a sales agreement or to perform repairs under a warranty the consumer may file a claim with the department for payment from the consumer recovery fund. The claim shall be verified by the department.

C. On verification of the claim for payment, the director shall provide for a hearing pursuant to chapter 6, article 10 of this title.

D. The director shall pay from the consumer recovery fund whatever sum the administrative law judge finds payable on the claim. A decision granting a claim shall include an order suspending the license of the licensee on whose account the claim was filed. The license shall remain suspended until the licensee has repaid in full, plus interest at the rate of ten percent per year, the amount paid from the consumer recovery fund on the licensee's account.

E. Any party aggrieved by the administrative law judge's decision may apply for a rehearing by filing with the director a motion in writing pursuant to chapter 6, article 10 of this title. The filing of a motion for rehearing shall suspend the operation of the administrative law judge's order pending the decision of the director on the rehearing.

F. Except as provided in section 41-1092.08, subsection H, any person aggrieved by a final administrative decision may seek judicial review pursuant to title 12, chapter 7, article 6.

G. The consumer recovery fund has a claim against the licensee on whose account a claim was granted or any other person who caused or contributed to a claim paid by the consumer recovery fund for the amount paid plus costs, necessary expenses and reasonable attorney fees.

H. The director is subrogated to the claim of the consumer recovery fund against the bond and other assets of the licensee. The director shall deposit any amount recovered into the consumer recovery fund.

I. If, at any time, the money deposited in the consumer recovery fund is insufficient to satisfy any duly authorized claim or portion of a claim, the director, when sufficient money has been deposited in the consumer recovery fund, shall satisfy such unpaid claims or portions of claims in the order that such claims or portions of claims were originally filed.

J. A consumer pursuant to subsection A or B of this section is barred from commencing an application for payment from the consumer recovery fund later than two years from the date of sale or date of installation, whichever is later.

§ 41-4044 False statement; violation; classification

A person or the person's agent who knowingly files with the director any notice, statement or other document required under section 41-4042 or 41-4043 that is false or untrue or contains any material misstatement of fact is guilty of a class 2 misdemeanor.

§ 41-4045 Waiver of rights

The failure of an aggrieved person to comply with section 41-4042 or 41-4043 constitutes a waiver of any rights under such sections.

§ 41-4046 Enforcement powers of director; civil and administrative penalties

A. The director, personnel of the department and personnel under contract to the department, on presentation of credentials, shall be allowed to enter and inspect premises where units regulated by this chapter are manufactured, sold or installed as the director may deem appropriate to determine if any person has violated this chapter. A person who is licensed by the department may not refuse to admit the director or the personnel of the department or personnel under contract if the proper credentials are presented and the inspection is made at a reasonable time.

B. If the director has reasonable cause to believe a unit is being offered for sale by a party required to be licensed but not licensed as a dealer by the department or is in violation of this chapter, or the rules, regulations or standards adopted pursuant to this chapter, the department shall serve on the manufacturer, dealer, broker or installer a notice of violation, which may be affixed to the unit in violation and, if affixed to the unit, shall not be removed by anyone without the authorization of the department.

C. If there is reasonable cause to believe, from information furnished to the director or from an investigation instituted by the director, that any person is engaged in a business regulated by this article without being licensed as required by law, the director shall issue and serve on the person, by certified mail, a cease and desist order requiring the person immediately, on receipt of the notice, to cease and desist from engaging in such business. On failure of the person to comply with the order, the director shall file an action in the superior court in Maricopa county restraining and enjoining the person from engaging in such business. The court in the action shall proceed as in other actions for injunctions.

D. If in the judgment of the director any person has engaged, or is about to engage, in any acts or practices that constitute, or will constitute, a violation of this chapter, the rules, regulations or standards adopted pursuant to this chapter or an order issued pursuant to this chapter, the director may make application to the appropriate court for an order enjoining those acts or practices. On a showing by the director that the person has engaged in, or is about to engage in, any such acts or practices, an injunction, restraining order or such other order as may be appropriate shall be granted by the court without bond. On a showing by the director that a licensee has wrongfully withdrawn, or is about to wrongfully withdraw, funds required to be held in the licensee's trust account, an injunction, restraining order or such other order as may be appropriate to prevent a licensee from wrongfully withdrawing trust account monies shall be granted by the court. On granting a permanent injunction, the court may impose a civil penalty of not more than the civil penalty as determined annually by the United States department of housing and urban development for each violation.

E. In any investigation, proceeding or hearing that the director may institute, conduct or hold under this article, the director, or a representative designated by the director, may administer oaths, certify to official acts, issue subpoenas for attendance of witnesses and production of books, papers and records and exercise the same powers in this regard as conferred on public officers by section 12-2212.

F. After any hearing that the director may institute, conduct or hold under this article, the director or a representative designated by the director may impose an administrative penalty in an amount of not more than the civil penalty as determined annually by the United States department of housing and urban development for each violation. All monies collected pursuant to this subsection shall be deposited in the state general fund.

G. The director may refer to the attorney general or a county attorney for criminal or civil investigation the results of any investigation that indicate the existence of the elements of fraud, including investigative information regarding any person or entity that, although not a licensee under this article, has a business or other relationship to a licensee or to a manufactured home transaction under this article.

H. If an inspection reveals that a mobile home entering this state for sale or installation is in violation of this chapter, the department may order its use discontinued and the mobile home or any portion of the mobile home vacated. The order to vacate shall be served on the person occupying the mobile home and copies of the order shall be posted at or on each exit of the mobile home. The order to vacate shall include a reasonable period of time in which the violation can be corrected. A person shall not occupy or use a mobile home in violation of an order to vacate.

I. If construction, rebuilding or any other work is performed in violation of this chapter or any rule adopted pursuant to this chapter, the department may order the work stopped. The order to stop work shall be served on the person doing the work or on the person causing the work to be done. The person served with the order shall immediately cease the work until authorized by the department to continue.

§ 41-4047 Unlawful acts

It is unlawful for any person to:

Manufacture manufactured homes or factory-built buildings in this state or for delivery or sale in this state unless such person is licensed as a manufacturer by the department.
Engage in the business of installing manufactured homes, mobile homes or accessory structures unless such person is licensed as an installer by the department.
Engage in the business of a salesperson of manufactured homes, mobile homes or factory-built buildings unless the person is licensed as a salesperson by the department.
Engage in the business of contracting to sell any new or used unit regulated by this article or otherwise act in the capacity of a dealer or broker unless such person is licensed as a dealer or broker by the department.
Make alterations to or reconstruct any manufactured homes or factory-built buildings unless such person is licensed or certified.

§ 41-4048 Violation; classification; penalty

A. A person required to be licensed pursuant to this article may not sell or offer to sell in this state any manufactured home or factory-built building unless the proper state certificate or HUD label is affixed to such unit.

B. A person required to be licensed pursuant to this article may not manufacture for delivery, sell or offer to sell in this state any manufactured home or factory-built building unless the unit and its components, systems and appliances have been constructed and assembled in accordance with the standards and rules adopted pursuant to this chapter.

C. A person shall not occupy or otherwise use a mobile home that has been brought into this state or move a mobile home from one mobile home park in this state to another mobile home park in this state unless it meets the standards adopted pursuant to this chapter and displays the proper state certificate. A mobile home that is rehabilitated in accordance with rehabilitation rules adopted by the department and receives a certificate shall be deemed by a county or municipality to be acceptable for relocation into an existing mobile home park. This subsection does not apply to a person bringing a mobile home into this state as a tourist.

D. A person shall not advertise or offer for sale a mobile home that has been brought into this state unless it meets the standards adopted pursuant to this chapter and displays the proper state certificate.

E. A person may not remove or cause to be removed a certificate or a notice of violation without prior authorization of the department.

F. A person shall not occupy or use a mobile home in violation of an order to vacate issued pursuant to section 41-4004, subsection A, paragraph 6.

G. Except as provided in subsections I and J of this section, a person who violates this chapter, or any such rule or standard, is guilty of a class 2 misdemeanor.

H. The director, after notice and a hearing pursuant to section 41-4031, subsection A, may deny the issuance of a license or revoke or suspend the license of, impose an administrative penalty on or place on probation any manufacturer, dealer, broker, salesperson or installer who has violated this chapter or any standards and rules adopted pursuant to this chapter.

I. Any manufacturer, dealer, broker, salesperson or installer who knowingly violates this chapter or the rules adopted pursuant to section 41-4010, subsection A, paragraph 1, 2, 9 or 10 or any person who knowingly provides false information to seek reimbursement of expenses under section 41-4008 is guilty of a class 1 misdemeanor. Each violation of this chapter shall constitute a separate violation with respect to each failure or refusal to allow or perform an act required by this chapter, except that the maximum fine may not exceed one million dollars for any related series of violations occurring within one year after the date of the first violation.

J. An individual or a director, officer or agent of a corporation who knowingly violates this chapter or the rules adopted pursuant to this chapter in a manner that threatens the health or safety of any purchaser is guilty of a class 1 misdemeanor.

K. A manufacturer, dealer or salesperson shall not knowingly sell a unit regulated by this chapter to an unlicensed person for the purpose of resale, nor shall a dealer offer for sale or sell a new unit manufactured by an unlicensed person.

L. In addition to any other obligations imposed by law or contract during the term of a listing agreement, a licensee who has agreed to act as an agent to offer a mobile home, manufactured home or factory-built building for sale shall promptly submit all offers to purchase the listed unit from any source to the client. The offers shall be in writing and signed and dated by the party making the offer and the client on receipt. A copy of the executed document shall be maintained as part of the record of sales.

M. A licensee, owner or other persons may not manufacture, alter, reconstruct or install units regulated by this chapter, unless it is accomplished in a workmanlike manner in accordance with the rules adopted pursuant to this chapter and is suitable for the intended purpose.

Article 5 Mobile Home Parks Administrative Hearings

§ 41-4061 Administrative adjudication of complaints

Pursuant to chapter 6, article 10 of this title, an administrative law judge shall adjudicate complaints regarding and ensure compliance with the Arizona mobile home parks residential landlord and tenant act.

§ 41-4062 Hearing; rights and procedures; definitions

A. A person that is subject to title 33, chapter 11 or a party to a rental agreement entered into pursuant to title 33, chapter 11 may petition the department for a hearing concerning violations of the Arizona mobile home parks residential landlord and tenant act by filing a petition with the department and paying a nonrefundable filing fee in an amount to be established by the director. All monies collected shall be deposited in the Arizona department of housing program fund established by section 41-3957 and are not refundable.

B. The petition shall be in writing on a form approved by the department, list the complaints, be signed by or on behalf of the persons filing and include their addresses, state that a hearing is desired and be filed with the department.

C. On receipt of the petition and the filing fee, the department shall mail to the named respondent by certified mail a copy of the petition along with notice that a response showing cause, if any, why the petition should be dismissed is required within twenty days after mailing of the petition.

D. After receiving the response, the director or the director's designee shall promptly review the petition for hearing and, if justified, refer the petition to the office of administrative hearings. The director may dismiss a petition for hearing if it appears to the director's satisfaction that the disputed issue or issues have been resolved by the parties.

E. Failure of the respondent to answer is deemed an admission of the allegations made in the petition, and the director shall issue a default decision.

F. Informal disposition may be made of any contested case.

G. Either party or the party's authorized agent may inspect any file of the department that pertains to the hearing if the authorization is filed in writing with the department.

H. At a hearing conducted pursuant to this section, a corporation may be represented by a corporate officer, employee or contractor of the corporation who is not a member of the state bar if:

The corporation has specifically authorized the officer, employee or contractor of the corporation to represent it.
The representation is not the officer's, employee's or contractor of the corporation's primary duty to the corporation but is secondary or incidental to the officer's, employee's or contractor of the corporation's, limited liability company's, limited liability partnership's, sole proprietor's or other lawfully formed and operating entity's duties relating to the management or operation of the corporation.

I. For the purposes of this section:

"Department" means the Arizona department of housing.
"Director" means the director of the department.

§ 41-4063 Orders; penalties; disposition

A. The administrative law judge may order any party to abide by the statute or contract provision at issue and may levy a civil penalty on the basis of each violation. For the purposes of actions brought under the Arizona mobile home parks residential landlord and tenant act, the civil penalty may not exceed five hundred dollars. All monies collected pursuant to this article shall be deposited in the state general fund to be used to offset the cost of administering the administrative law judge function. If the petitioner prevails, the administrative law judge shall order the respondent to pay to the petitioner the filing fee required by section 41-4062.

B. The order issued by the administrative law judge is binding on the parties unless a rehearing is granted pursuant to section 41-4065 based on a petition setting forth the reasons for the request for rehearing, in which case the order issued at the conclusion of the rehearing is binding on the parties. The order issued by the administrative law judge is enforceable through contempt of court proceedings and is subject to judicial review as prescribed by section 41-1092.08.

§ 41-4064 Scope of hearing

A. The administrative law judge may hear and adjudicate all matters relating to the Arizona mobile home parks residential landlord and tenant act and rules adopted pursuant to this article, except that the administrative law judge shall not hear matters pertaining to rental increases pursuant to section 33-1413, subsection G or I.

B. This section does not limit the jurisdiction of the courts of this state to hear and decide matters pursuant to the Arizona mobile home parks residential landlord and tenant act.

§ 41-4065 Rehearing; appeal; definition

A. A person aggrieved by a decision of the administrative law judge may apply for a rehearing by filing with the director a petition in writing pursuant to section 41-1092.09. Within ten days after filing such petition, the director shall serve notice of the request on the other party by mailing a copy of the petition in the manner prescribed in section 41-4062 for notice of hearing.

B. The filing of a petition for rehearing temporarily suspends the operation of the administrative law judge's action. If the petition is granted, the administrative law judge's action is suspended pending the decision on the rehearing.

D. In a rehearing conducted pursuant to this section, a corporation may be represented by a corporate officer or employee who is not a member of the state bar if:

The corporation has specifically authorized such officer or employee to represent it.
Such representation is not the officer's or employee's primary duty to the corporation but is secondary or incidental to such officer's or employee's duties relating to the management or operation of the corporation.

E. For the purposes of this section, "director" means the director of the Arizona department of housing.

Chapter 40 Arizona Rangers

Article 1 General Provisions

§ 41-4201 Arizona rangers

The Arizona rangers are an unpaid, noncommissioned civilian auxiliary that is available for the purpose of assisting and supporting law enforcement in this state. The Arizona rangers do not possess any law enforcement or investigative powers that are not provided or established in law for all citizens of this state. Law enforcement support and assistance services are provided on the request of, and under the direction, control and supervision of, established law enforcement officials or officers.

Chapter 41 Arizona Department of Homeland Security

Article 1 General Provisions

§ 41-4251 Definitions

In this chapter, unless the context otherwise requires:

"Department" means the Arizona department of homeland security.
"Director" means the director of the department.

§ 41-4252 Arizona department of homeland security; director; deputy director; assistant directors; divisions

A. The Arizona department of homeland security is established. The direction, operation and control of the department are the responsibility of the director.

B. The governor shall appoint the director pursuant to section 38-211. The director shall administer the department and serve at the pleasure of the governor. The director is entitled to receive compensation as determined under section 38-611. The director shall appoint a deputy director and a statewide chief information security officer and, subject to legislative appropriation, may appoint additional deputy directors and those assistant directors as the director deems appropriate. The positions of director, statewide chief information security officer and deputy director are exempt from chapter 4, articles 5 and 6 of this title relating to the state service.

C. To be eligible for appointment as director a person must have a background or experience in one or more of the following areas:

Public administration.
Disaster response.
Law enforcement.
Business administration.
Cybersecurity.

D. The director may organize the department into divisions the director deems appropriate.

§ 41-4253 Department employees

Subject to chapter 4, article 4 and, as applicable, articles 5 and 6 of this title, the director shall employ, determine the conditions of employment of and specify the duties of employees the director deems necessary.

§ 41-4254 Department duties

The department shall:

Formulate policies, plans and programs to enhance the ability of this state to prevent and respond to acts of terrorism, cybersecurity threats and other critical hazards.
Adhere to all federal grant terms and conditions.
Request appropriations or grants of monies for homeland security purposes.
Receive all awards granted to this state by the federal government for homeland security purposes.
Distribute monies to local jurisdictions and other organizations eligible under federal regulations based on criteria in the federal grant guidelines.

§ 41-4255 Annual report

A. On or before September 1 of each year, the Arizona department of homeland security shall submit a homeland security allocation and expenditure report to the governor, the president of the senate, the speaker of the house of representatives, the chairperson of the senate appropriations committee, the chairperson of the house appropriations committee and the staff and cochairpersons of the joint legislative budget committee.

B. The director shall provide a copy of the report to the secretary of state. The department may redact sensitive information contained in the report if necessary.

C. The report shall include:

Each local and state project that was awarded funding for the current year.
Expenditures for each local and state project that was awarded funding for the current year.
Expenditures from federal appropriations and grants that were used by the department for administrative and state agency purposes.
A narrative description detailing each state project awarded funding, including the goals and objectives of each state project.
The progress made on each project since the last report.
Project awards and expenditures for open grant projects by June 30 of each year.
A detailed plan on how homeland security efforts will be continued in the event of decreased federal funding.

§ 41-4258 Arizona department of homeland security regional advisory councils; appointment; terms; duties

A. The Arizona department of homeland security regional advisory councils are established.

B. The department shall ensure reasonable distribution of area representation. A total of five councils are established as follows:

The north region is composed of the jurisdictions contained in the Coconino, Navajo and Apache county boundaries.
The east region is composed of the jurisdictions contained in the Graham, Greenlee, Gila and Pinal county boundaries.
The south region is composed of the jurisdictions contained in the Pima, Santa Cruz, Cochise and Yuma county boundaries.
The west region is composed of the jurisdictions contained in the Mohave, La Paz and Yavapai county boundaries.
The central region is composed of the jurisdictions contained in the Maricopa county boundaries.

C. Each regional advisory council consists of twelve members who serve for a term of three years. Members shall reside or work in the region they represent, except for the representative from the department of public safety. For the purposes of limiting the membership in a county, the representative from the department of public safety and the tribal representative do not count toward the membership limit from a county.

D. The governor shall appoint each member of a regional advisory council. The membership of the councils consists of:

A representative of a fire service from an urban or suburban area in the region.
A representative of a fire service from a rural area in the region.
A police chief.
A county sheriff or the sheriff's proxy.
A tribal representative.
An emergency manager.
Four at-large members.
A representative from the department of public safety.
A public health representative.

E. A member must have a background in or experience with disaster response or law enforcement issues.

F. Subject to approval by the director or deputy director, within a reasonable time frame before the meeting, members may be represented on the council by a person designated by that member to serve as the member's proxy. The proxy must have a background in or experience with disaster response or law enforcement issues.

G. At the first meeting held after July 1 of each year, each regional advisory council shall elect a chairperson and vice chairperson.

H. Each regional advisory council shall meet on an as-needed basis to conduct business. No actions may be taken without a quorum present.

I. It is the duty of each regional advisory council member to maintain communication with and represent other offices and organizations within the members' professional discipline in the region.

J. In coordination with the department, the regional advisory council shall:

Support and assist in implementing Arizona's comprehensive statewide risk assessment.
Support and assist an integrated regional approach to homeland security in this state.
Encourage baseline prevention and response capabilities throughout the region consistent with state and regional plans.
Develop a list of recommendations for state homeland security grant program monies and forward these recommendations to the director.
Recommend allocation of state homeland security grant program monies to eligible jurisdictions and other organizations based on regional, state and federal criteria.

K. Members are not eligible to receive compensation but are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2.

L. Elected officials shall serve on the council in their capacity as elected officials. If an elected official is no longer in office that position on the regional advisory council shall be considered vacant and a new appointment shall be made.

Article 2 Critical Infrastructure

§ 41-4271 Definitions

In this article, unless the context otherwise requires:

"Critical infrastructure" has the same meaning prescribed in section 41-1801.
"Fuel facility" means a commercial aviation fuel, petroleum or natural gas transmission facility in this state that is not located on the premises of a commercial airport.

§ 41-4272 Protection of critical infrastructure; fuel facilities

Notwithstanding any other law, on or before October 1 of each year the owners of a fuel facility shall provide a written report to the director regarding security measures being taken by the operators of the fuel facility and by any other agency or authority of this state or any political subdivision of this state and, to the extent practicable, of any federal entity, to protect the security of the critical infrastructure. The owners of the fuel facility and any other agency or authority of this state or any political subdivision of this state involved in the protection of this critical infrastructure shall coordinate and cooperate in the preparation of the report and shall make a good faith effort to include input from any federal entity involved in the protection of this critical infrastructure. As deemed appropriate by the director, the department may physically inspect the premises and review any audits or reports related to the security of the critical infrastructure, including audits or reports conducted at the request of any other agency or authority of this state or any political subdivision of this state or, to the extent practicable, of any federal entity. The operators of the fuel facility, in compliance with any federal and state requirements regarding the dissemination of this information, shall provide access to the director to the audits or reports regarding critical infrastructure. The exclusive custody and control of the audits and reports remain solely with the operators of the fuel facility.

§ 41-4273 Reporting requirements; confidentiality

A. Before January 1, 2010, and every five years thereafter, the director shall provide a report to the governor, the president of the senate, the speaker of the house of representatives and the operator of a fuel facility listing the director's recommendations to the legislature, the operators of a fuel facility or any appropriate state or federal regulating entity or agency of any additional security measures that are recommended to be implemented, if the director determines the measures are recommended considering among other factors the unique characteristics of each fuel facility.

B. Before receiving the report required by subsection A, each recipient of the report shall develop confidentiality protocols, in consultation with the director for the maintenance and use of the report to ensure the confidentiality of the report and all information contained in the report. The confidential protocols are binding on the recipient that issues the protocols and anyone to whom the recipient shows a copy of the report. The report and any information contained or used in its preparation are exempt from and shall not be made available pursuant to title 39, chapter 1, article 2. The director shall also develop protocols for the department related to the maintenance and use of the report to ensure the confidentiality of the report and all information contained in the report. On each report, the director shall prominently display the following statement: "This report may contain information that if disclosed could endanger the life or safety of the public. This report is to be maintained and used in a manner consistent with protocols established to preserve the confidentiality of the information contained in this report in a manner consistent with law."

Article 3 Statewide Information Security and Privacy Office

§ 41-4281 Definitions

In this article, unless the context otherwise requires:

"Breach" or "security system breach" has the same meaning prescribed in section 18-551.
"Budget unit" has the same meaning prescribed in section 18-101.
"Information technology" has the same meaning prescribed in section 18-101.
"Security incident" has the same meaning prescribed in section 18-551.

§ 41-4282 Statewide information security and privacy office; duties; suspension of budget unit's information infrastructure

A. The statewide information security and privacy office is established in the Arizona department of homeland security. The statewide information security and privacy office shall serve as the strategic planning, facilitation and coordination office for information security in this state. Individual budget units shall continue to maintain operational responsibility for information security.

B. The director shall serve as or appoint the statewide chief information security officer to manage the statewide information security and privacy office. If other than the director, the statewide chief information security officer shall report to the director pursuant to section 41-4252.

C. The statewide information security and privacy office shall:

Develop, implement, maintain and ensure compliance for each budget unit with statewide information security policies and a coordinated statewide assurance plan for information security and privacy.
Direct information security and privacy protection compliance reviews for each budget unit to ensure compliance with policies, standards and effectiveness of information security assurance plans as necessary.
Identify information security and privacy protection risks in each budget unit and direct agencies to adopt risk mitigation strategies, methods and procedures to minimize the risks.
Monitor and report compliance of each budget unit with state information security and privacy protection policies, standards and procedures.
Coordinate statewide information security and privacy protection awareness and training programs.
Establish a state security operations center for central detection, reporting and response efforts for security incidents and breaches across the state.
Develop other strategies as necessary to protect this state's information technology infrastructure and the data that is stored on or transmitted by the infrastructure.
Consult with the department of administration for a full review of the security aspects for information technology projects prescribed in section 18-104.
Operate the information security aspects of the enterprise-level infrastructure managed by the department of administration.

D. The statewide information security and privacy office may temporarily suspend operation of information infrastructure that is owned, leased, outsourced or shared to isolate the source of, or stop the spread of, an information security system breach or other similar incident. A budget unit and the department of administration, as applicable, shall comply with directives to temporarily discontinue or suspend operations of information infrastructure.

E. Each budget unit and its contractors shall identify and report security incidents to the statewide information security and privacy office immediately on discovery and deploy mitigation strategies as directed.

F. The Arizona department of homeland security may examine all books, papers, records and documents in the office of any budget unit and may require any state officer of the budget unit to provide the information or statements necessary to carry out this section.

G. Budget units shall demonstrate expertise to carry out security assurance plans, either by employing staff or contracting for outside services.

H. A budget unit may enter into an agreement with the department of administration or the Arizona department of homeland security to meet the requirements of this section.

Chapter 44 Authorized Presence Requirements

Article 1 Government Procurement

§ 41-4401 Government procurement; e-verify requirement; definitions

A. After September 30, 2008, a government entity shall not award a contract to any contractor or subcontractor that fails to comply with section 23-214, subsection A. Every government entity shall ensure that every government entity contractor and subcontractor complies with the federal immigration laws and regulations that relate to their employees and section 23-214, subsection A. Every government entity shall require that every government entity contract include all of the following provisions:

That each contractor and subcontractor warrants their compliance with all federal immigration laws and regulations that relate to their employees and their compliance with section 23-214, subsection A.
That a breach of a warranty under paragraph 1 shall be deemed a material breach of the contract that is subject to penalties up to and including termination of the contract.
That the government entity retains the legal right to inspect the papers of any contractor or subcontractor employee who works on the contract to ensure that the contractor or subcontractor is complying with the warranty under paragraph 1.

B. Every government entity that enters into a contract shall establish procedures to conduct random verification of the employment records of government entity contractors and subcontractors to ensure that the contractors and subcontractors are complying with their warranties.

C. A government entity shall not deem a government entity contractor or subcontractor in material breach of a contract if the contractor or subcontractor establishes that it has complied with the employment verification provisions prescribed by sections 274a and 274b of the federal immigration and nationality act and the e-verify requirements prescribed by section 23-214, subsection A.

D. For the purposes of this section:

"Contract" means all types of government entity agreements, regardless of what they may be called, for the procurement of services in this state.
"Contractor" means any person who has a contract with a government entity.
"E-verify program" means the employment verification pilot program as jointly administered by the United States department of homeland security and the social security administration or any of its successor programs.
"Government entity" means this state and any political subdivision of this state that receives and uses tax revenues.
"Services" means the furnishing of labor, time or effort in this state by a contractor or subcontractor. Services include construction or maintenance of any structure, building or transportation facility or improvement of real property.
"Subcontractor" means a person who contracts to perform work or render service to a contractor or to another subcontractor as a part of a contract with a government entity.

Chapter 48 Private Attorney Retention

Article 1 General Provisions

§ 41-4801 Definitions

In this chapter, unless the context otherwise requires:

"Government attorney" means an attorney employed by this state as a staff attorney in the attorney general's office.
"Private attorney" means any private attorney or law firm.
"State" means this state, including state officers, agencies, departments, boards and commissions and units of organization, however designated, of the executive branch of this state, and any of its agents, but does not include those agencies as provided in section 41-192, subsection D.

§ 41-4802 Written determination of necessity to enter into contingency fee contract; procurement

A. This state may not enter into a contingency fee contract with a private attorney unless the attorney general makes a written determination before entering into such a contract that contingency fee representation is both cost effective and in the public interest. The attorney general's written determination shall include specific findings for each of the following factors:

Whether there exist sufficient and appropriate legal and financial resources within the attorney general's office to handle the matter.
The time and labor required to perform the task, the novelty, complexity and difficulty of the questions involved and the skill necessary to perform the attorney services properly.
The geographic area where the attorney services are to be provided.
The amount of experience desired for the particular kind of attorney services to be provided and the nature of the private attorney's experience with similar issues or cases.

B. If the attorney general makes the determination provided in subsection A, the attorney general shall request proposals from private attorneys to represent the department on a contingency fee basis, unless the attorney general determines that requesting proposals is not feasible under the circumstances and prescribes the basis for this determination in writing. If the attorney general makes such a determination, the contract is not subject to chapter 23 of this title.

§ 41-4803 Contingent fee limitation; requirements; notices; applicability

A. This state may not enter into a contingency fee contract that provides for this state's private attorney to receive a contingency fee from this state's portion of the recovery in excess of an aggregate of all of the following:

Twenty-five per cent of the initial recovery of less than ten million dollars.
Twenty per cent of that portion of any recovery of ten million dollars or more but less than fifteen million dollars.
Fifteen per cent of that portion of any recovery of fifteen million dollars or more but less than twenty million dollars.
Ten per cent of that portion of any recovery of twenty million dollars or more but less than twenty-five million dollars.
Five per cent of any recovery of twenty-five million dollars or more.

B. The contingency fee received by this state's private attorney shall not exceed fifty million dollars, except for reasonable costs and expenses and regardless of the number of lawsuits filed or the number of private attorneys retained to achieve the recovery.

C. The state shall not enter into a contract for contingency fee attorney services unless the following requirements are met throughout the contract period and any extensions of the contract:

A government attorney retains ultimate control over the course and conduct of the case.
A government attorney with supervisory authority is personally involved in overseeing the litigation.
A government attorney retains veto power over any decisions made by the private attorney.
Any defendant's attorney that is the subject of the litigation may contact the lead government attorney directly without having to confer with the private attorney.
A government attorney with supervisory authority for the case attends all settlement conferences. For the purposes of this paragraph, "attends" includes attendance by phone, teleconferencing or similar electronic devices.
Decisions regarding settlement of the case may not be delegated to this state's private attorney.

D. The attorney general shall develop a standard addendum to every contract for contingent fee attorney services that the attorney general must use in all cases, describing in detail what is expected of both the contracted private attorney and this state, including the requirements prescribed in subsection C.

E. The attorney general shall post copies of any executed contingency fee contract and the attorney general's written determination to enter into a contingency fee contract with the private attorney on the attorney general's website for public inspection within five business days after the date the contract is executed, which shall remain posted on the website for the duration of the contingency fee contract, including any extensions or amendments of the contract, unless the attorney general determines that the posting may cause damage to the reputation of any business or person. Notwithstanding the requirements of this subsection, posting on the website shall be made no later than when a lawsuit is filed. The attorney general shall post any payment of contingency fees on the attorney general's website within fifteen days after the payment of the contingency fees to the private attorney, which shall remain posted on the website for at least three hundred sixty-five days thereafter.

F. Any private attorney under contract to provide services to this state on a contingency fee basis, from the inception of the contract until at least four years after the contract expires or is terminated, shall maintain detailed current records, including documentation of all expenses, disbursements, charges, credits, underlying receipts and invoices and other financial transactions that concern the provision of the attorney services. The private attorney shall make all the records available for inspection and copying on request pursuant to title 39, chapter 1, article 2. The private attorney shall maintain detailed contemporaneous time records for the attorneys and paralegals working on the matter in increments of no greater than one tenth of one hour and shall promptly provide these records to the attorney general on request.

G. This chapter does not apply to any contingent fee contract in which this state hires a private attorney to pursue debt collection and restitution cases for this state.

§ 41-4804 Reports

By February 1 of each year, the attorney general shall submit a report to the president of the senate and the speaker of the house of representatives and forward a copy of the report to the secretary of state that describes the use of contingency fee contracts with private attorneys in the preceding calendar year. At a minimum the report shall:

Identify all new contingency fee contracts entered into during the year and all previously executed contingency fee contracts that remain current during any part of the year.
Describe for each contract:

(a) The name of the private attorney with whom the department has contracted, including the name of the attorney's law firm.

(b) The nature and status of the legal matter.

(d) The amount of any recovery.

(e) The amount of any contingency fee paid.

Include copies of any written determinations made pursuant to section 41-4802 during the year.

§ 41-4805 No expansion of authority

This chapter does not expand the authority of any state agency or state employee to enter into contracts where no authority previously existed.

Chapter 49 Federal Monies

Article 1 General Provisions

§ 41-4901 Federal monies; prohibition; union labor preference

A department, institution, board or commission is prohibited from accepting federal monies for a construction project if as a condition of accepting the federal monies the department, institution, board or commission is required to give a preference to union labor.

Chapter 50 Valid Identification

Article 1 General Provisions

§ 41-5001 Valid identification; consular identification cards; definition

A. This state or any political subdivision of this state shall accept a consular identification card that is issued by a foreign government as a valid form of identification if the foreign government uses biometric identity verification techniques in issuing the consular identification card.

B. For the purposes of this section, "biometric identity verification techniques" includes fingerprint identification and retina scans.

Chapter 52 Persons with Disabilities

Article 1 General Provisions

§ 41-5201 Persons with disabilities; usage

This state shall use the term "persons with disabilities" in all laws, rules, publications, orders, actions, programs, policies and signage. This state shall revise laws, rules, publications, orders, actions, programs, policies and signage to use the term "persons with disabilities" only when updates are otherwise necessary.

§ 41-5202 Communications; accessibility; emergency response interpreters

A. Pursuant to the Americans with disabilities act of 1990 (P.L. 101-336; 104 Stat. 327; 42 United States Code sections 12101 through 12213) and its regulations, this state shall take reasonable steps to ensure that its communications with persons with disabilities, including online communications and emergency communications, are equally as effective as this state's communications with persons without disabilities. This state shall take reasonable steps to ensure that persons with disabilities are able to communicate with, receive information from and convey information to this state. This state shall provide auxiliary aids and services when needed to communicate effectively with persons with communication disabilities.

B. This state shall establish a protocol to take reasonable steps to secure an interpreter who is licensed by the commission for the deaf and the hard of hearing pursuant to title 36, chapter 17.1, article 2, with preference for an interpreter who is certified through the department of emergency and military affairs' emergency response interpreter credentialing program, to interpret emergency communications that are presented live to the media for broadcast or delivered through a live online communication, including an official government statement or press conference relating to an emergency situation.

C. This section does not prevent this state from communicating to the public during an emergency situation if an interpreter is unavailable.

Chapter 53 Office of Economic Opportunity

Article 1 General Provisions

§ 41-5301 Definitions

In this chapter, unless the context otherwise requires:

"Director" means the director of the office.
"Office" means the office of economic opportunity.

§ 41-5302 Office of economic opportunity; funds

A. The office of economic opportunity is established.

B. The director is responsible for the direction, operation and control of the office.

C. The governor shall appoint the director of the office pursuant to section 38-211 to serve at the pleasure of the governor.

D. The office of economic opportunity operations fund is established consisting of monies deposited pursuant to sections 44-1843, 44-1861, 44-1892, 44-3324 and 44-3325 and as otherwise provided by law. The office shall administer the fund. Monies in the fund are continuously appropriated. Monies in the fund may be used in the furtherance of the mission of the office and related economic development interests.

E. The economic development fund is established consisting of monies received from the Arizona industrial development authority and the Arizona finance authority as otherwise provided by law. The office shall administer the fund.

§ 41-5303 Powers and duties

A. The director shall:

Monitor this state's tax and regulatory competitiveness by benchmarking this state against competitor states and municipalities, including implementing a systematic data collection and analysis process to evaluate tax and regulatory costs to businesses imposed by this state and municipalities of this state in relation to other states and municipalities.
Serve as this state's workforce planning coordinator, provide staffing support to the workforce Arizona council, provide stewardship of the state workforce data evaluation system, provide economic and demographic research and analysis, including constitutionally required population estimates, provide employment and unemployment estimates and develop labor market information for the development of the state workforce strategy.
Provide office and meeting space, administrative support and analytical support to the Arizona finance authority and coordinate with the Arizona finance authority director to incorporate finance market intelligence in economic development strategy and policy recommendations.
Develop data-informed policy and regulatory reform recommendations and provide assistance with state tax and regulatory matters, including the development and analysis of proposed rules and regulations and the projected cost on employers relating to those rules and regulations.
Provide analytical support to the Arizona commerce authority in its business recruitment, growth and retention strategies.
Provide analytical support to the Arizona commerce authority, the Arizona-Mexico commission in the governor's office and the office of tourism in their state marketing strategies.

B. The director may:

Contract and incur obligations that are reasonably necessary or desirable within the general scope of the office's activities and operations to enable the office to adequately perform its duties.
Use monies, facilities or services to provide matching contributions under federal or other programs that further the objectives and programs of the office.
Accept gifts, grants, matching monies or direct payments from public or private agencies or private persons and enterprises for the conduct of programs that are consistent with the general purposes and objectives of this chapter.

Article 2 Arizona Finance Authority

§ 41-5351 Definitions

In this article, unless the context otherwise requires:

"Agreement" means any loan or other agreement, contract, note, mortgage, deed of trust, trust indenture, lease, sublease or instrument entered into by the authority.
"Arizona industrial development authority" means the industrial development authority established by the Arizona finance authority.
"Authority" means the Arizona finance authority.
"Board" means the board of directors of the authority.
"Bonds" means any bonds issued by the authority or the Arizona industrial development authority.
"Costs":

(a) Means all costs incurred in the issuance of bonds, including insurance policy, credit enhancement, legal, accounting, consulting, printing, advertising and travel expenses, plus any authority administrative fees.

(b) May include interest on bonds for a reasonable time before and during the time the proceeds are used.

"Director" means the director of the authority.
"Federal agency" means the United States or any agency or agencies of the United States.

§ 41-5352 Arizona finance authority; fund

A. The Arizona finance authority is established in the office of economic opportunity.

B. The governor shall appoint the director of the authority to serve at the pleasure of the governor.

C. The Arizona finance authority operations fund is established consisting of monies deposited pursuant to section 41-5355. The authority shall administer the fund. Monies in the fund are continuously appropriated.

D. At the end of the fiscal year, the authority shall transfer all unencumbered monies in the fund in excess of the authority's operating costs to the economic development fund established by section 41-5302.

§ 41-5353 Board; members; terms; meetings; compensation; prohibition

A. The authority shall be governed by a board of directors, consisting of five members to be appointed by the governor, giving due consideration to a diverse geographical representation on the board, and to serve at the pleasure of the governor.

B. Excluding reappointment, before appointment by the governor, a prospective member of the board of directors shall submit a full set of fingerprints to the governor for the purpose of obtaining a state and federal criminal records check pursuant to section 41-1750 and Public Law 92-544. The department of public safety may exchange this fingerprint data with the federal bureau of investigation.

C. Each member shall serve for a term of three years. Vacancies occurring other than by expiration of term shall be filled in the same manner for the remainder of the unexpired term. If a term expires and a member has not been reappointed or replaced by a newly appointed member, the member may continue to serve until reappointment or until a replacement is appointed.

D. The board shall annually elect from among its members a chairperson, a secretary and a treasurer.

E. The board rules shall provide for regular annual meetings of the board. The chairperson may call a special meeting at any time. The board rules shall provide for a method of giving notice of a special meeting.

F. The board may meet by audioconference or videoconference. The requirements of title 38, chapter 3, article 3.1 apply to an audioconference or videoconference, except that all votes of members must be by roll call.

G. Members of the board are not eligible to receive compensation but are eligible to receive reimbursement for necessary expenses pursuant to title 38, chapter 4, article 2 while engaged in the performance of the members' duties.

H. Members of the board may not have any direct or indirect personal financial interest in any project financed by the Arizona finance authority or the Arizona industrial development authority or otherwise under this article.

§ 41-5354 Powers of board

The board may:

Adopt an official seal and alter the seal at its pleasure.
Apply for, accept and administer grants of monies or materials or property of any kind from a federal agency or others on such terms and conditions as may be imposed.
Make and enter into agreements, including intergovernmental agreements pursuant to title 11, chapter 7, article 3, execute all instruments, perform all acts and do all things necessary or convenient to carry out the powers granted.
Employ or contract with experts, engineers, architects, attorneys, accountants, construction and financial experts and such other persons as may be necessary in the board's judgment and fix their compensation.
Pay compensation and employee-related expenses.
Fix the compensation of the director.
Sue and be sued.
Acquire and maintain office space, equipment, supplies, services and insurance necessary to administer this article.
Contract with, act as guarantor for or coinsure with any federal, state or local governmental agency and other organizations or corporations in connection with its activities under this article and receive monies relating to those contracts and services.
Adopt bylaws and administrative rules consistent with this article.
Protect and enforce the interests of the authority in any project financed through the authority's resources.
Enter into and inspect any facility financed through the authority's resources to investigate its physical condition, construction, rehabilitation, operation, management and maintenance and to examine all of the records relating to its capitalization, income and other related matters.
Acquire title to real property or other assets by gift, grant or operation of law, or by purchase.
Establish advisory boards that have all rights and powers granted by the board, including the right to review, evaluate and recommend to the board for approval proposed financings and programs.

§ 41-5355 Assets; cost of operation and administration; taxation

A. Any monies, pledges or property issued or given to the Arizona finance authority, whether by appropriation, loan, gift or otherwise, constitute the assets of the Arizona finance authority.

B. This state is not responsible for any obligation incurred by the authority.

C. All costs and expenses of the Arizona finance authority shall be paid from bond proceeds of bonds issued by any industrial development authority established by the Arizona finance authority or other monies of the Arizona finance authority, and to the extent not prohibited by state or federal law or by contract, the monies of the greater Arizona development authority that are available to pay the Arizona finance authority's costs and expenses.

D. The authority and its income are exempt from taxation in this state.

§ 41-5356 Duties of board; annual report

A. The board shall:

Establish the Arizona industrial development authority under title 35, chapter 5 and, notwithstanding the requirements of section 35-705, serve as the board of the Arizona industrial development authority.
Serve as the board of the greater Arizona development authority and have all powers and authority to take action on behalf of the greater Arizona development authority pursuant to chapter 18 of this title.
Approve the Arizona finance authority's budget.

B. On or before October 1 of each year, the Arizona industrial development authority shall submit a report to the president of the senate, the speaker of the house of representatives and the directors of the joint legislative budget committee and the governor's office of strategic planning and budgeting regarding the Arizona industrial development authority's revenues, expenditures and program activity for the previous fiscal year.

§ 41-5357 Supplemental law

The powers conferred by this article are in addition and supplemental to the powers conferred by any other law, general or special, and are deemed full authority for the issuance of bonds, for entering into agreements in connection therewith and for the authorization, issuance and sale of bonds pursuant to this article and without regard to the procedure required by any other such law, except as provided for in title 44, chapter 12, article 4.

Article 3 Workforce

§ 41-5401 Workforce Arizona council; duties; report

A. The governor by executive order shall establish a workforce Arizona council and appoint members to the council consistent with 29 United States Code section 3111.

B. The workforce Arizona council that is established by executive order shall assist the governor in:

The development, implementation and modification of a state workforce plan.
The review of statewide policies and programs. The workforce Arizona council shall make recommendations to the governor on actions that should be taken to align workforce development programs in a manner that supports a comprehensive and streamlined workforce development system.
The development and continuous improvement of the workforce development system in this state.
The development and the updating of comprehensive state performance accountability measures.
The identification and dissemination of information on workforce best practices.
The development and review of statewide policies affecting the coordinated provision of services through a one-stop delivery system.
The development of strategies for technology improvements to facilitate access to and improve the quality of services and activities provided through a one-stop delivery system.
The development of strategies for aligning technology and data systems across one-stop partner programs to enhance service delivery and improve efficiencies in reporting on performance accountability measurement and reporting processes and the incorporation of local input into the design and implementation of one-stop partner programs.
The development of allocation formulas for the distribution of monies for employment and training activities for adults and youth workforce investment activities.

C. The workforce Arizona council shall meet at least four times each year and shall submit a written annual report to the governor, the president of the senate, the speaker of the house of representatives and the joint legislative budget committee by December 1 of each year. This report shall include:

Information specifying the levels of performance achieved with respect to the primary indicators of performance of workforce development programs and performance with respect to individuals with barriers to employment disaggregated by race, ethnicity, sex and age.
The total number of participants served by workforce development programs.
The number of participants who received career and training services and the amount of monies spent on each type of service.
The number of participants who exited from career and training services.
The average cost per participant of those participants who received career and training services.
The percentage of participants who received training services and obtained employment in a field related to the training received.
The number of individuals with barriers to employment served by workforce development programs.

D. Each state agency and community college shall submit to the workforce Arizona council the information necessary to compile the report described in subsection C, paragraph 3 of this section by November 1 of each year.

E. The workforce Arizona council shall coordinate with state agencies and state community colleges to produce outcome-based performance measures for all state workforce development programs.

§ 41-5402 Population estimates; labor market information; powers and duties; definition

A. The office shall:

Provide economic and demographic research and analysis, including constitutionally required population estimates, and provide employment and unemployment estimates.
Produce local labor market information packages and conduct labor market analyses, including special studies and job impact analyses in support of state and local employment, training, education and job creation programs and activities that support programs designed to align employer needs with the employment base to reduce unemployment and create jobs.
Support the development and implementation of the workforce innovation and opportunity act (P.L. 113-128; 128 Stat. 1425).

B. The office may:

Establish mechanisms to recover actual costs incurred in producing, maintaining and providing otherwise unfunded labor market information that is aligned with all applicable federal guidelines.
Receive federal set-aside monies from any federal program that is authorized to fund state and local labor market information and that is required to use the information in support of the federal program.
Coordinate with other state agencies to study ways to standardize and enhance federal and state multiagency administrative records and information, such as unemployment insurance information, to produce the employment, training, education and economic analysis needed to improve labor market information products and services.
Partner with the federal government as needed in order to provide detailed employment and unemployment data, population projections and research data.

C. For the purposes of this section, "labor market information" means the body of information generated from measurement and evaluation of the socioeconomic factors and variables influencing the employment process in this state and specific labor market areas. Data used for measurement and evaluation may include unemployment insurance information received according to specific data sharing agreements with the department of economic security. The socioeconomic factors and variables that affect labor demand and supply relationships include:

Labor force information, including unemployment, labor force participation, labor turnover and mobility, average hours and earnings and changes and characteristics of the population and labor force within specific labor market areas in this state.
Occupational information, including occupational supply and demand estimates and projections, characteristics of occupations, wage levels, job duties, training and education requirements, conditions of employment, unionization, retirement practices and training opportunities.
Economic information, including number of business starts and stops by industry and labor market area, information on employment growth and decline by industry and labor market area, employer establishment data and number of labor-management disputes by industry and labor market area.
Program information, including program participant or student information gathered in cooperation with other state and local agencies along with related labor market information to evaluate the effectiveness, efficiency and impact of state and local employment, training, education and job creation efforts in support of planning, management, implementation and evaluation.

§ 41-5403 Workforce data stewardship

A. The office of economic opportunity and the department of economic security shall enter into a memorandum of understanding on or before September 30, 2016 to establish that the office of economic opportunity is the designated office for this state and is responsible for fulfilling unemployment insurance data requests by entities specified in section 23-722.04, subsection A.

B. The office of economic opportunity and the department of economic security in the memorandum of understanding shall establish specifications for quarterly data transmissions of unemployment insurance information to the office of economic opportunity. The initial transmission shall include all archived data available.

§ 41-5404 Workforce data task force; membership; duties; report

A. The workforce data task force is established in the office of economic opportunity to oversee workforce system evaluation data sharing. The task force shall consist of the following members:

The director of the office of economic opportunity, or the director's designee, who shall serve as chairperson of the task force.
The director of the department of economic security or the director's designee.
The superintendent of public instruction or the superintendent's designee.
The president of the Arizona board of regents or the president's designee.
A representative of a community college district or the representative's designee.

B. The director of the office of economic opportunity may appoint advisory members to the task force as necessary.

C. Members of the task force are not eligible to receive compensation. The office of economic opportunity shall provide adequate staff support for the task force.

D. The task force shall:

Oversee development and maintenance of the state workforce evaluation data system.
Define and regularly review requirements, structures and methodologies for the system, including:

(a) A retention schedule for unemployment insurance records that supports the longitudinal evaluation of workforce and education programs.

(b) Data standards relating to unemployment insurance data, including rules for definition, format, source, provenance, element level and contextual integrity.

(d) System performance expectations.

(e) Controls for data confidentiality and data security for unemployment data, including when data is in transmission.

(f) Data quality and reporting standards.

(g) Required elements for data sharing agreements that conform to relevant state and federal requirements and that establish adequacy of receiving system requirements.

(h) A methodology to fund the development and ongoing database costs from existing resources of entities that have entered into current data sharing agreements pursuant to section 23-722.04.

Provide analyses and recommendations for all of the following:

(a) Data audit management, including data quality metrics, sanctions and incentives for data quality improvement.

(b) Documentation standards for data elements and systems components.

(d) Publication of standard and ad hoc reports for state and local level use on workforce system performance.

Submit an annual report regarding the task force's activities on or before November 1 to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of this report to the secretary of state. The initial report shall include all initial requirements, structures and methodologies determined pursuant to this section.

Article 4 Adult Workforce Development

§ 41-5421 Adult workforce diploma program; fund; program providers list; reporting requirements; review; definitions

A. The adult workforce diploma program is established in the office of economic opportunity to assist individuals who are at least twenty-one years of age in earning high school diplomas and developing critical employability and career and technical skills to prepare the individuals for employment. The office shall administer the program. The program may be delivered in a campus-based, online or blended modality.

B. The adult workforce diploma program fund is established consisting of legislative appropriations, gifts, grants and other donations. The office shall administer the fund and use monies in the fund to pay participating program providers as prescribed in subsection E of this section. Monies in the fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations. The office may use not more than five percent of the monies in the fund for the costs of administering the adult workforce diploma program.

C. On or before August 15 of each year, each program provider that seeks to participate in the program shall submit to the office on a form that is developed by the office information showing that the program provider meets all of the following requirements:

Is operating a regionally accredited high school diploma-granting entity.
Is able to develop a learning plan for each student that integrates graduation requirements and career goals.
Provides a course catalog that includes all courses that are necessary to meet graduation requirements.
Is able to provide all of the following:

(a) Remediation opportunities in literacy and numeracy.

(b) Career pathways coursework.

(d) Career placement services.

(e) Academic skills intake assessments and transcript evaluations.

D. On or before October 15 of each year, the office shall place all qualified program providers that submit a form pursuant to subsection C of this section on a program providers list. Participating program providers shall begin enrolling students on or before November 15 of each year. A program provider may be removed from the program providers list only if the program provider's authorization to participate in the program is revoked pursuant to subsection J of this section.

E. The office shall pay participating program providers the following amounts for each student who completes the following milestones:

$250 for each completed half unit of high school credit.
$250 for each completed employability skills certification.
$250 for each earned industry-recognized credential or stackable credential that requires not more than fifty hours of training.
$500 for each earned industry-recognized credential or stackable credential that requires more than fifty hours but not more than one hundred hours of training.
$750 for each earned industry-recognized credential or stackable credential that requires more than one hundred hours of training.
$1,000 for each earned high school diploma.

F. Participating program providers shall submit monthly invoices to the office not later than the tenth calendar day of each month for milestones met in the previous calendar month. Participating program providers shall report the number of currently enrolled students for whom invoices have been submitted and the number of currently enrolled students for whom invoices have not yet been submitted together with the monthly invoices submitted pursuant to this subsection. The office shall pay participating program providers in the order in which invoices are submitted until all available monies are spent. The office shall provide a written update to the program providers on or before the last calendar day of each month that includes all of the following:

The aggregate total dollars that have been paid to program providers for the program year.
The aggregate number of currently enrolled students in this state for whom one or more invoices have been submitted.
The aggregate number of currently enrolled students for whom invoices have not yet been submitted.
The estimated number of enrollments still available for the program year.

G. On or before October 30 of each year, each participating program provider shall report the following to the office:

The total number of students who were funded through the program.
The total number of earned credits.
The total number of earned industry-recognized credentials or stackable credentials earned for each tier of funding.
The total number of students who graduated through the program.
Information required for the performance measures adopted by the state board of education pursuant to section 15-217.

H. The office shall compile the reports received from program providers pursuant to subsection G of this section and, on or before December 15 of each year, shall provide an annual report to the governor, the president of the senate, the speaker of the house of representatives and the state board of education and shall provide a copy of the report to the secretary of state.

I. Beginning fiscal year 2027-2028, the office shall review data from each participating program provider to ensure that the program provider is achieving minimum program performance standards, including:

A graduation rate of at least fifty percent.
An average cost per graduate of $7,000 or less.

J. The office may develop a process to bring a program provider into compliance. The office shall revoke a program provider's authorization to participate in the program if the program provider does not comply with the requirements of this section within two years.

K. For the purposes of this section:

"Academic skills intake assessment" means a criterion-referenced assessment of numeracy and literacy skills with high reliability and validity that is determined by third-party research and that may be administered in person or online.
"Accredited provider" means an entity that is currently accredited by one of the seven regional accreditation organizations or any successor entity.
"Average cost per graduate" means the total program funding disbursed to a participating program provider divided by the total number of graduates for a cohort calculated twelve months after the close of the cohort.
"Career pathways coursework" means one or more courses that align with the skill needs of industries in the economy of this state or region and that assist students to enter or advance within a specific occupation or occupational cluster.
"Career placement services" means services that are designed to assist students in obtaining employment, including career interest self-assessments, job search skills, résumé development and mock interviews.
"Cohort" means the students who enter the program between July 1 and June 30 of each program year.
"Employability skills certification" means a certificate earned by demonstrating professional nontechnical skills through assessment and must include the program standards of the United States department of labor's "skills to pay the bills: mastering soft skills for workplace success".
"Graduate" means a student who has successfully completed all state and program provider requirements to earn a high school diploma.
"Graduation rate" means the total number of graduates from a cohort divided by the total number of students from the same cohort calculated twelve months after the close of the cohort.
"Graduation requirements" means course and credit requirements needed to earn a high school diploma from a program provider.
"High school diploma" means a diploma that is issued by an accredited provider and that is recognized as a secondary school diploma by this state.
"Industry-recognized credential" means an education-related or work-related credential that verifies an individual's qualification or competence and that is issued by a third party with the relevant authority to issue the credential.
"Learning plan" means a documented plan that both:

(a) Is designed to prepare a student to succeed in the program and the student's future endeavors.

(b) Identifies the courses and credits that are needed for a student to complete the program and that are graduation requirements.

"Milestones" means objective measures of progress for which payment is made to a program provider under this section, including earned units of high school credit, earned industry-recognized credentials and earned high school diplomas.
"Program" means the adult workforce diploma program.
"Program provider" means a public, nonprofit or other entity that meets the requirements of this section and that does not receive federal or state funding or private tuition for a student who is funded through the program.
"Stackable credential" means a third-party credential that is part of a sequence of credentials that can be accumulated over time to build up an individual's qualifications to advance along a career pathway.
"Student" means a participant in the program who is at least twenty-one years of age, who is a resident of this state and who has not earned a high school diploma.
"Transcript evaluation" means a documented summary of credits that students earned in previous public or private accredited high schools compared with program and program provider graduation requirements.
"Unit of high school credit" means a credit that is awarded based on a student's demonstration that the student has successfully met the content expectations for the credit area as defined by subject area standards, expectations or guidelines.

Chapter 54 Uniform Electronic Legal Material Act

Article 1 General Provisions

§ 41-5501 Short title

This article may be cited as the "uniform electronic legal material act".

§ 41-5502 Definitions

In this article, unless the context otherwise requires:

"Electronic" means relating to technology having electrical, digital, magnetic, wireless, optical, electromagnetic or similar capabilities.
"Legal material" means, whether or not in effect:

(a) The Constitution of Arizona.

(b) The Arizona session laws.

"Official publisher" means the Arizona legislative council.
"Publish" means to display, present or release to the public, or cause to be displayed, presented or released to the public, by the official publisher.
"Record" means information that is inscribed on a tangible medium or that is stored in an electronic or other medium and is retrievable in perceivable form.
"State" means a state of the United States, the District of Columbia, Puerto Rico, the United States Virgin Islands or any territory or insular possession subject to the jurisdiction of the United States.

§ 41-5503 Applicability

This article applies to all legal material in an electronic record that is designated as official under section 41-5504 and first published electronically on or after August 6, 2016.

§ 41-5504 Legal material in official electronic record

A. If an official publisher publishes legal material only in an electronic record, the publisher shall:

Designate the electronic record as official.
Comply with sections 41-5505, 41-5507 and 41-5508.

B. An official publisher that publishes legal material in an electronic record and also publishes the material in a record other than an electronic record may designate the electronic record as official if the publisher complies with sections 41-5505, 41-5507 and 41-5508.

§ 41-5505 Authentication of official electronic record

An official publisher of legal material in an electronic record that is designated as official under section 41-5504 shall authenticate the record. To authenticate an electronic record, the publisher shall provide a method for a user to determine that the record received by the user from the publisher is unaltered from the official record published by the publisher.

§ 41-5506 Effect of authentication

A. Legal material in an electronic record that is authenticated under section 41-5505 is presumed to be an accurate copy of the legal material.

B. If another state has adopted a law substantially similar to this article, legal material in an electronic record that is designated as official and authenticated by the official publisher in that state is presumed to be an accurate copy of the legal material.

C. A party contesting the authentication of legal material in an electronic record authenticated under section 41-5505 has the burden of proving by a preponderance of the evidence that the record is not authentic.

§ 41-5507 Preservation and security of legal materials in official electronic record

A. An official publisher of legal material in an electronic record that is or was designated as official under section 41-5504 shall provide for the preservation and security of the record in an electronic form or a form that is not electronic.

B. If legal material is preserved under subsection A of this section in an electronic record, the official publisher shall:

Ensure the integrity of the record.
Provide for backup and disaster recovery of the record.
Ensure the continuing usability of the material.

§ 41-5508 Public access to legal material in official electronic record

An official publisher of legal material in an electronic record that is required to be preserved under section 41-5507 shall ensure that the material is reasonably available for use by the public on a permanent basis.

§ 41-5509 Standards

In implementing this article, an official publisher of legal material in an electronic record shall consider:

Standards and practices of other jurisdictions.
The most recent standards regarding authentication of, preservation and security of and public access to legal material in an electronic record and other electronic records, as promulgated by national standard-setting bodies.
The needs of users of legal material in an electronic record.
The views of governmental officials and entities and other interested persons.
To the extent practicable, methods and technologies for the authentication of, preservation and security of and public access to legal material that are compatible with the methods and technologies used by other official publishers in this state and in other states that have adopted a law substantially similar to this article.

§ 41-5510 Uniformity of application and construction

In applying and construing this uniform act, consideration must be given to the need to promote uniformity of the law with respect to its subject matter among states that enact it.

§ 41-5511 Relation to electronic signatures in global and national commerce act

This article modifies, limits and supersedes the electronic signatures in global and national commerce act (15 United States Code section 7001 et seq.) but does not modify, limit or supersede section 101(c) of the electronic signatures in global and national commerce act (15 United States Code section 7001(c)), or authorize electronic delivery of any of the notices described in section 103(b) of the electronic signatures in global and national commerce act (15 United States Code section 7003(b)).

Chapter 55 Regulatory Sandbox Program

Article 1 General Provisions

§ 41-5601 Definitions

In this chapter, unless the context otherwise requires:

"Applicable agency" means a department or agency of this state established by law to regulate certain types of business activity in this state and persons engaged in such business, including the issuance of licenses or other types of authorization, that the attorney general determines would or may regulate a sandbox participant if the person was not a regulatory sandbox participant.
"Consumer":

(a) Means a person that purchases or enters into a transaction for an innovation that is being tested by a sandbox participant.

(b) Does not include an agent or business partner of or an investor in a sandbox participant.

"Financial product or service" means a product or service that requires licensure under title 6 or title 44, chapter 2.1 or 13 or a product or service that includes a business model, delivery mechanism or element that may otherwise be regulated under title 6 or title 44, chapter 2.1 or 13.
"Innovation" means the use or incorporation of new or emerging technology or the reimagination of uses for existing technology to address a problem, provide a benefit or otherwise offer a product, service, business model or delivery mechanism that is not known by the attorney general to have a comparable widespread offering in this state.
"Innovative financial product or service" means a financial product or service that includes an innovation.
"Regulatory sandbox" means the program established by this chapter that allows a person to temporarily test an innovation on a limited basis without otherwise being licensed or authorized to act under the laws of this state.
"Sandbox participant" means any person whose application to participate in the regulatory sandbox is approved pursuant to this chapter.
"Test" means to provide products and services as allowed by this chapter.

§ 41-5602 Program purpose

The attorney general shall establish a regulatory sandbox program in consultation with applicable agencies of this state to enable a person to obtain limited access to the market in this state to test innovative financial products or services or other innovations without obtaining a license or other authorization that otherwise might be required.

§ 41-5603 Application process and requirements; fee

A. Any person may apply to enter the regulatory sandbox to test an innovation.

B. The attorney general must accept and review each application for entry into the regulatory sandbox on a rolling basis.

C. An application must demonstrate that an applicant both:

Is an entity or individual that is subject to the jurisdiction of the attorney general through incorporation, residency, presence agreement or otherwise.
Has established a location, whether physical or virtual, that is adequately accessible to the attorney general, from which testing will be developed and performed and where all required records, documents and data will be maintained.

D. Persons that already possess a license or other authorization under state laws that regulate a financial product or service or other innovation must file an application with the attorney general to test an innovation within the regulatory sandbox for a product or service or other innovation outside the scope of the license or authorization.

E. Applications must contain sufficient information to demonstrate that an applicant has an adequate understanding of the innovation and a sufficient plan to test, monitor and assess the innovation while ensuring consumers are protected from a test's failure.

F. Applications must contain the information required by a form that is developed and made publicly available by the attorney general. The information required by the form may include:

Relevant personal and contact information for the applicant, including full legal names, addresses, telephone numbers, email addresses, website addresses and other information that the attorney general deems necessary.
Disclosure of any criminal convictions of the applicant or key personnel, if any.
A description of the innovation desired to be tested, including statements regarding all of the following:

(a) How an innovation is subject to regulation outside of the regulatory sandbox.

(b) How the innovation would benefit consumers.

(c) How the innovation is different from other financial products or services or other innovations available in this state.

(d) What risks will confront consumers.

(e) How entering the regulatory sandbox would enable a successful test of the innovation.

(f) A description of the proposed testing plan, including estimated time periods for market entry, market exit and the pursuit of necessary licensure or authorization.

(g) How the applicant will wind down the test and protect consumers if the test fails.

(h) How the applicant will employ cybersecurity measures to avoid breaches and protect consumer and transaction data.

G. The attorney general shall collect an application fee in an amount to be determined by the attorney general. The attorney general shall deposit, pursuant to sections 35-146 and 35-147, all fees collected pursuant to this subsection in the consumer protection-consumer fraud revolving fund established by section 44-1531.01.

H. A person shall file a separate application for each innovation sought to be tested.

I. After the information required by subsection F of this section is submitted, the attorney general may seek additional information that it deems necessary. Not later than ninety days after an application is initially submitted, the attorney general shall notify the applicant as to whether the application is approved for entry into the regulatory sandbox. The attorney general and an applicant may mutually agree to extend the time period for the attorney general to determine whether an application is approved for entry into the regulatory sandbox.

J. The attorney general may deny applications in its discretion and a denial is not an appealable agency action for the purposes of chapter 6, article 10 of this title.

§ 41-5604 Consultation with applicable agencies; admission authority

A. The attorney general must consult with an applicable agency before admitting a person into the regulatory sandbox. This consultation may include seeking information about:

Whether the applicable agency previously has either:

(a) Issued a license or other authorization to the applicant.

(b) Investigated, sanctioned or pursued legal action against the applicant.

Whether the applicant could obtain a license or other authorization from an applicable agency after exiting the regulatory sandbox.

B. Notwithstanding subsection A of this section, the attorney general has sole authority to make the final decision whether to admit a person into the regulatory sandbox.

§ 41-5605 Scope

A. If the attorney general approves an application for entry into the regulatory sandbox, the applicant is deemed a sandbox participant and both of the following apply:

The sandbox participant has twenty-four months after the date of approval to test the innovation described in the sandbox participant's application.
The attorney general must issue the sandbox participant a registration number.

B. Innovations tested within the regulatory sandbox are subject to the following restrictions:

Consumers must be residents of this state, except for transactions that involve an innovation provided by a sandbox participant testing financial products or services as a money transmitter as defined in section 6-1241 or a related innovation, in which case only physical presence of the consumer in this state at the time of the transaction may be required.
Except as provided in subsection C of this section or section 41-5608, an innovation may not be tested with more than ten thousand consumers.
For a sandbox participant testing consumer lender loans as defined in section 6-601, an individual consumer lender loan may be issued for up to $15,000, except that aggregate loans per consumer may not exceed $50,000. All consumer lender loans issued in the regulatory sandbox, including loans in excess of $10,000, are subject to all of the following:

(a) Section 6-114.

(b) Section 6-632.

(d) Section 6-637.

Except as provided in subsection C of this section, for a sandbox participant testing financial products or services as a money transmitter as defined in section 6-1241, individual transactions per consumer may not exceed $2,500 and aggregate transactions per consumer may not exceed $25,000.
For sandbox participants testing financial products or services as a sales finance company as defined in section 44-281, all of the following apply:

(a) Section 44-286.

(b) Section 44-287, except subsection B, paragraph 8.

(d) Section 44-289.

(e) Section 44-290.

(f) Section 44-291.

(g) Section 44-293.

(h) Section 47-9601.

For sandbox participants testing financial products or services that provide investment management that is regulated pursuant to title 44, chapter 13:

(a) Section 44-3241 applies.

(b) The corporation commission rules adopted pursuant to title 44, chapter 13 apply as they relate to dishonest and unethical practices.

C. If a sandbox participant demonstrates adequate financial capitalization, risk management process and management oversight, the attorney general may allow either or both of the following:

Except as provided in section 41-5608, an innovation to not be tested with more than seventeen thousand five hundred consumers.
For a sandbox participant testing products or services as a money transmitter as defined in section 6-1241, individual transactions per consumer that do not exceed $15,000 and aggregate transactions per consumer that do not exceed $50,000.

D. This section does not restrict a sandbox participant who holds a license or other authorization in another jurisdiction from acting pursuant to and in accordance with that license or other authorization.

E. A sandbox participant is deemed to possess an appropriate license under the laws of this state for purposes of any provision of federal law requiring state licensure or authorization.

F. Except as otherwise provided in this chapter, a sandbox participant is not subject to state laws that establish requirements pursuant to a license or authorization issued by an applicable agency that otherwise would or may regulate an innovative financial product or service.

G. The attorney general may determine that certain state laws that regulate a financial product or service or innovation apply to a sandbox participant. If the attorney general makes this determination and approves an application for entry into the regulatory sandbox, the attorney general must notify the sandbox participant of the specific state regulatory laws that will apply to the sandbox participant. Pursuant to section 41-5611, the attorney general alone shall enforce the state regulatory laws applicable to sandbox participants, including the restrictions established by this section.

H. To the extent that a sandbox participant is required by this chapter to obtain, record, provide or maintain any information, writing, signature, record or disclosure, the sandbox participant may do so in electronic form, including as provided in section 44-7601, or may substitute any substantially similar equivalent information, writing, signature, record or disclosure that is approved by the attorney general.

§ 41-5606 Consumer protection

A. Before providing an innovation to consumers, a sandbox participant must disclose to consumers all of the following:

The name and contact information of the sandbox participant, including the registration number provided by the attorney general pursuant to section 41-5605.
That the innovation is authorized pursuant to the regulatory sandbox and, if applicable, that the sandbox participant does not have a license or other authorization to generally provide financial products or services or innovations under state laws that regulate a financial product or service or innovation that is outside the regulatory sandbox.
That this state does not endorse or recommend the innovation.
That the innovation is a temporary test that may be discontinued at the end of the testing period, including the expected end date of the testing period.
That consumers may contact the attorney general to file complaints regarding the innovation being tested and provide the attorney general's telephone number and website address where complaints may be filed.

B. The notifications prescribed by subsection A of this section must be provided to consumers in a clear and conspicuous form in both English and Spanish. For an internet or application-based innovation, consumers must acknowledge receipt of these notifications before completion of a transaction.

C. The attorney general may require that a sandbox participant make additional disclosures to consumers. When the attorney general approves an application for entry into the regulatory sandbox, the attorney general shall notify the sandbox participant of the additional disclosures.

§ 41-5607 Exit requirements

A. At least thirty days before the end of the twenty-four-month regulatory sandbox testing period, a sandbox participant must either:

Notify the attorney general that the sandbox participant will exit the regulatory sandbox, wind down its test and cease offering any innovative products or services in the regulatory sandbox within sixty days after the twenty-four-month testing period ends.
Seek an extension pursuant to section 41-5608 to pursue a license or other authorization required by law.

B. If the attorney general does not receive notification pursuant to subsection A of this section, the regulatory sandbox testing period ends at the end of the twenty-four-month testing period and the sandbox participant must immediately cease offering innovative products or services.

C. If a test includes offering products or services that require ongoing duties, such as servicing a loan, the sandbox participant must continue to fulfill those duties or arrange for another person to fulfill those duties after the date the sandbox participant exits the regulatory sandbox.

§ 41-5608 Discretionary allowances

A. A sandbox participant may request an extension of the regulatory sandbox testing period or an increase in the consumer cap established by section 41-5605 for the purpose of pursuing a license or other authorization required by law.

B. The attorney general may grant or deny a request pursuant to subsection A of this section within thirty days after the request. A request granted pursuant to this subsection may not be effective for more than one year after the approval date.

C. A sandbox participant that obtains an extension or increase pursuant to subsection B of this section must provide the attorney general with a written report every three months that provides an update on efforts to obtain a license or other authorization, including any submitted applications for licensure or other authorization, rejected applications or issued licenses or other authorization.

D. The attorney general may deny requests made under subsection A of this section, and a denial is not an appealable agency action for the purposes of chapter 6, article 10 of this title.

§ 41-5609 Recordkeeping and reporting requirements

A. A sandbox participant must retain records, documents and data produced in the ordinary course of business regarding an innovation tested in the regulatory sandbox.

B. If an innovation fails before the end of the testing period, the sandbox participant must notify the attorney general and report on actions taken to ensure consumers have not been harmed as a result of the innovation's failure.

C. A sandbox participant is subject to the requirements of section 18-552 and must notify the attorney general of any breach as defined in section 18-551.

§ 41-5610 Records; disclosure; evidentiary effect

A. Records that are submitted to or obtained by the attorney general in administering this chapter are not public records or open for inspection by the public.

B. Records and information that are submitted or obtained pursuant to this chapter may be disclosed to any of the following:

State and federal agencies.
Representatives of foreign countries that have regulatory or supervisory authority over the activities of the sandbox participant.
A federal, state or county grand jury in response to a lawful subpoena.
The state auditor general for the purpose of conducting audits authorized by law.

C. The attorney general and any applicable agency consulted by the attorney general pursuant to section 41-5604 are not liable for the disclosure of records, information or data received or obtained pursuant to this chapter.

D. The disclosure pursuant to subsection B of this section of a complaint or the results of an examination, inquiry or investigation of a sandbox participant does not make that information a public record and the sandbox participant or the sandbox participant's holding company may not disclose that information to the general public unless the disclosure is required by law. A sandbox participant or the sandbox participant's holding company may not disclose, use or reference in any form comments, conclusions or results of an examination, inquiry or investigation in any type of communication to a customer or potential customer.

E. This section does not prevent the disclosure of information that is admissible in evidence in a civil or criminal proceeding brought by a state or federal law enforcement agency to enforce or prosecute civil or criminal violations of the law.

§ 41-5611 Reporting requirements; monitoring; enforcement; agreements

A. The attorney general may establish periodic reporting requirements for sandbox participants.

B. The attorney general may seek records, documents and data from sandbox participants. On the attorney general's request, sandbox participants must make such records, documents and data available for inspection by the attorney general.

C. If the attorney general has reasonable cause to believe that a sandbox participant has engaged in, is engaging in or is about to engage in any practice or transaction that is in violation of this chapter, that constitutes an unlawful practice under section 44-1522 or that constitutes a violation of a state or federal criminal law, the attorney general may remove a sandbox participant from the regulatory sandbox or order a sandbox participant to exit the regulatory sandbox pursuant to section 41-5607.

D. Removal from the regulatory sandbox is not an appealable agency action for the purposes of chapter 6, article 10 of this title.

E. Sandbox participants are subject to the consumer fraud provisions under title 44, chapter 10, article 7.

F. The attorney general may enter into agreements with state, federal or foreign regulators in advancing the purpose of regulatory sandbox, which may include allowing sandbox participants to operate in other jurisdictions and allowing entities authorized to operate in other jurisdictions to be recognized as sandbox participants in this state.

Chapter 56 School Capital Finance

Article 1 School Facilities

§ 41-5701 Definitions

In this chapter, unless the context otherwise requires:

"Board" means the school facilities oversight board.
"Division" means the division of school facilities within the department of administration.

§ 41-5701.01 Division of school facilities

A. The division of school facilities is established within the department of administration.

B. The director of the department of administration shall appoint the director of the division.

§ 41-5701.02 School facilities oversight board; members; conflict of interest; violation; classification; change orders; notification

A. The school facilities oversight board is established within the division consisting of the following members who are appointed by the governor pursuant to section 38-211 in such a manner as to provide for approximate geographic balance and approximate balance between public and private members:

One member who represents a statewide organization of taxpayers.
One member who is a registered professional architect.
One member with knowledge and experience in school facilities management in a public school system.
One member who is a registered professional engineer.
Two members who are owners or officers of a private construction company, who have knowledge of and experience in constructing large commercial or government buildings and whose businesses do not include school construction.
One person who represents the business community.

B. In addition to the members appointed pursuant to subsection A of this section:

The superintendent of public instruction or the superintendent's designee shall serve as an advisory nonvoting member of the school facilities oversight board.
The director of the department of administration or the director's designee shall serve as an advisory nonvoting member of the school facilities oversight board.

C. Members of the school facilities oversight board serve four-year terms. The school facilities oversight board shall meet as often as the members deem necessary. A majority of the members constitutes a quorum for the transaction of business.

D. The unexcused absence of a member for more than three consecutive meetings is justification for removal by a majority vote of the board. If the member is removed, notice shall be given of the removal pursuant to section 38-292.

E. The governor shall fill a vacancy by appointment of a qualified person as provided in subsection A of this section.

F. Members of the board who are employed by government entities are not eligible to receive compensation. Members of the board who are not employed by government entities are entitled to payment of $150 for each meeting attended, prorated for partial days spent for each meeting, up to $2,500 each year. All members are eligible for reimbursement of expenses pursuant to title 38, chapter 4, article 2. These expenses and the payment of compensation are payable to a member from monies appropriated to the board from the new school facilities fund.

G. Members and employees of the school facilities oversight board are subject to title 38, chapter 3, article 8.

H. In addition to the requirements prescribed in subsection G of this section, employees of the school facilities oversight board may not have a direct or indirect financial interest in any property purchased, facility constructed or contract financed with monies made available by the board or any other public monies. A person who knowingly violates this subsection is guilty of a class 1 misdemeanor.

I. The division shall establish policies and procedures relating to building renewal grant change orders that include the following:

The division shall approve or reject a change order within two business days.
If a school district approves work referenced in a change order before the division approves the change order, the school district is responsible for the cost and construction of the project.

J. The division shall establish policies and procedures to ensure that it notifies school districts in a uniform manner and at least annually of the services and funding that are available from the board and the division for facility construction, renovation and repair projects. The division shall update and post this information on its website on or before July 1 of each year.

K. The division shall establish and maintain a list of the persons who are responsible for facilities management at each school district in this state. A school district shall promptly notify the division of any change to persons who are responsible for facilities management at that school district. The division shall update and post this information on its website on or before July 1 of each year.

L. Members of the school facilities oversight board may not solicit, accept or provide gifts that are prohibited by state law.

§ 41-5702 Powers and duties; staffing; reporting requirements

A. The division shall:

Assess school facilities and equipment deficiencies and approve the distribution of grants as appropriate.
Maintain a database of school facilities to allow for the administration of the new school facilities formula and the building renewal grant fund. The facilities listed in the database must include all buildings that are owned by school districts. The division shall ensure that the database is updated on at least an annual basis. Each school district shall report to the division not later than September 1 of each year information as required by the division to administer the building renewal grant fund and by the school facilities oversight board to compute new school facilities formula distributions, including the nature and cost of major repairs, renovations or physical improvements to or replacement of building systems or equipment that were made in the previous year and that were paid for either with local monies or monies provided from the building renewal grant fund. Each school district shall report any school or school buildings that have been closed, that are vacant or partially used pursuant to section 15-119 and that have been leased to another entity or that operate as a charter school. The division shall develop guidelines and definitions for the reporting prescribed in this paragraph and may review or audit the information, or both, to confirm the information submitted by a school district. Notwithstanding any other provision of this chapter, if a school district converts space that is listed in the database maintained pursuant to this paragraph to space that will be used for administrative purposes, the school district is responsible for any costs associated with converting, maintaining and replacing that space. If a building is significantly upgraded or remodeled, the division shall adjust the age of that school facility in the database as follows:

(a) Determine the building capacity value as follows:

(i) Multiply the student capacity of the building by the per pupil square foot capacity established by section 41-5741.

(ii) Multiply the product determined in item (i) of this subdivision by the cost per square foot established by section 41-5741.

(b) Divide the cost of the renovation by the building capacity value determined in subdivision (a) of this paragraph.

(c) Multiply the quotient determined in subdivision (b) of this paragraph by the currently listed age of the building in the database.

(d) Subtract the product determined in subdivision (c) of this paragraph from the currently listed age of the building in the database, rounded to the nearest whole number. If the result is a negative number, use zero.

Inspect, contract with a third party to inspect or certify school district self-inspections of school buildings at least once every five years to ensure compliance with the building adequacy standards prescribed in section 41-5711, the accuracy of the reporting of vacant and partially used buildings pursuant to this subsection and routine preventive maintenance guidelines as prescribed in this section with respect to constructing new buildings and maintaining existing buildings. The division shall randomly select twenty school districts every thirty months and provide for them to be inspected pursuant to this paragraph.
Develop prototypical elementary and high school designs. The division shall review the design differences between the schools with the highest academic productivity scores and the schools with the lowest academic productivity scores. The division shall also review the results of a valid and reliable survey of parent quality rating in the highest performing schools and the lowest performing schools in this state. The survey of parent quality rating shall be administered by the department of education. The division shall consider the design elements of the schools with the highest academic productivity scores and parent quality ratings in the development of elementary and high school designs. The division shall develop separate school designs for elementary, middle and high schools with varying pupil capacities.
Develop application forms, reporting forms and procedures to carry out the requirements of this article, including developing and implementing policies and procedures to:

(a) Ensure that the division and the school facilities oversight board, as applicable, notify school districts in a uniform manner of the services and funding available for school districts from the board or the division for facility construction, renovation and repair projects. The policies and procedures shall require the division and the board to provide at least one annual communication to school districts in a manner prescribed by the division and shall require each school district to develop and maintain a list of persons who are responsible for facilities management at that school district.

(b) Establish a project eligibility assessment for all projects submitted for building renewal grant funding or emergency deficiencies correction funding, including establishing standardized criteria for project eligibility. Before the division formally approves a project, the staff of the division may review the costs and scope of the proposed project with persons and entities that have submitted bids on the project.

(c) Ensure that the division and the school facilities oversight board maintain standardized documentation of all projects submitted to the board and the division for consideration to receive services or a financial award from the board or the division. The board and the division shall maintain standardized documentation of any project awarded monies by the board or the division, including records of payments to school districts in a manner prescribed by the division. The standardized documentation shall include the following as part of the eligibility determination criteria:

(i) Whether the problem that the proposed project intends to address caused the building or facility to fall below the minimum school facility adequacy guidelines prescribed in section 41-5711.

(ii) Whether the school district performed the routine preventive maintenance required by section 41-5731 on the building or facility.

(d) Require a school district to submit contact information for each proposed project, including the name, email address and telephone number of persons who are responsible for facilities management at the school district.

(e) Require a school district to provide justification for each proposed project, including all of the following:

(i) The school district's use or planned use of the facility.

(ii) A detailed description of the problem and the school district's recommended solution.

(iii) Any completed professional study regarding the proposed project.

(iv) Any citation or report from government entities.

(v) The estimated cost of the proposed project, with documentation.

(vi) The project category.

(vii) A description of any local funding that will be used for the proposed project.

(viii) Documentation on associated insurance coverage, if applicable.

(f) Require that an initial application not be considered complete until all necessary information is submitted.

(g) Allow a school district to submit an incomplete application and request technical assistance from the staff of the board if the school district is unable to provide sufficient information in the initial application.

(h) If applicable, require that a complete application be received by the board at least fifteen business days before the next regularly scheduled board meeting in order for the application to be considered at that meeting. An incomplete application may be considered at that meeting if both the staff of the board and the superintendent of the school district deem the project critical.

(i) Allow the staff of the board or the division, as applicable, to notify a school district in writing before review by the board or division that the proposed project does not meet eligibility criteria prescribed in this chapter. The written notification shall include documentation to support the determination that the proposed project does not meet the eligibility criteria prescribed in this chapter. The school district may directly appeal the determination of ineligibility to the director of the division. The school district may directly appeal the director's determination of ineligibility to the board.

(j) Prohibit the staff of the board or division from requesting that a school district withdraw a project application from review by the board or division if the initial review determines that the proposed project may be ineligible for monies pursuant to this chapter.

Electronically submit an annual report on or before December 15 to the speaker of the house of representatives, the president of the senate, the superintendent of public instruction, the secretary of state and the governor that includes the following information:

(a) A detailed description of the amount of monies distributed by the division under this chapter in the previous fiscal year.

(b) A list of each capital project that received monies from the division under this chapter during the previous fiscal year, a brief description of each project that was funded and a summary of the division's reasons for distributing monies for the project.

(c) A summary of the findings and conclusions of the building maintenance inspections conducted pursuant to this article during the previous fiscal year.

(d) A summary of the findings of common design elements and characteristics of the highest performing schools and the lowest performing schools based on academic productivity, including the results of the parent quality rating survey. For the purposes of this subdivision, "academic productivity" means academic year advancement per calendar year as measured with student-level data using the statewide nationally standardized norm-referenced achievement test.

On or before December 1 of each year, report electronically to the joint committee on capital review the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. In developing the amounts necessary for this report, the division shall use the most recent average daily membership data available. On request from the division, the department of education shall make available the most recent average daily membership data for use in calculating the amounts necessary to fulfill the requirements of section 41-5721 for the following three fiscal years. The division shall provide copies of the report to the president of the senate, the speaker of the house of representatives and the governor.
On or before June 15 of each year, electronically submit detailed information regarding demographic assumptions and a proposed construction schedule for individual projects approved in the current fiscal year and expected project approvals for the upcoming fiscal year to the joint committee on capital review for its review. A copy of the report shall also be submitted electronically to the governor's office of strategic planning and budgeting. The joint legislative budget committee staff, the governor's office of strategic planning and budgeting staff and the division staff shall agree on the format of the report.
Every two years, provide school districts with information on improving and maintaining the indoor environmental quality in school buildings.
Adopt rules regarding the validation of adjacent ways projects pursuant to paragraph 11 of this subsection.
Validate proposed adjacent ways projects that are submitted by school districts as prescribed in section 15-995 pursuant to rules adopted by the division under paragraph 10 of this subsection.
Submit a monthly report to the school facilities oversight board that details each adjacent ways project validated pursuant to paragraph 11 of this subsection.
Brief the joint committee on capital review at least once each year regarding the use of monies from all of the following:

(a) The emergency deficiencies correction fund established by section 41-5721.

(b) The building renewal grant fund established by section 41-5731.

B. The school facilities oversight board or the division may contract for the following services in compliance with the procurement practices prescribed in chapter 23 of this title:

Private services.
Construction project management services.
Assessments for school buildings to determine if the buildings have outlived their useful life pursuant to section 41-5741, subsection G or have been condemned.
Services related to land acquisition and development of a school site.

C. The school facilities oversight board shall:

Review and approve student population projections submitted by school districts to determine to what extent school districts are entitled to monies to construct new facilities pursuant to section 41-5741. The board shall make a final determination within five months after receiving an application from a school district for monies from the new school facilities fund.
Certify that plans for new school facilities meet the building adequacy standards prescribed in section 41-5711.
Review and approve or reject requests submitted by school districts to take actions pursuant to section 15-341, subsection G.
On or before December 15 of each year, electronically submit a report to the speaker of the house of representatives, the president of the senate, the superintendent of public instruction, the secretary of state and the governor that includes the following information:

(a) A detailed description of the amount of monies the board distributed under this chapter in the previous fiscal year.

(b) A list of each capital project that received monies from the board under this chapter during the previous fiscal year, a brief description of each project that was funded and a summary of the board's reasons for distributing monies for the project.

(c) A summary of the findings and conclusions of the building maintenance inspections conducted pursuant to this article during the previous fiscal year.

On or before December 1 of each year, electronically report to the joint committee on capital review the amounts necessary to fulfill the requirements of section 41-5741 for the following three fiscal years. In developing the amounts necessary for this report, the board shall use the most recent average daily membership data available. On request from the board, the department of education shall make available the most recent average daily membership data for use in calculating the amounts necessary to fulfill the requirements of section 41-5741 for the following three fiscal years. The board shall provide copies of the report to the president of the senate, the speaker of the house of representatives and the governor.
Adopt minimum school facility adequacy guidelines to provide the minimum quality and quantity of school buildings and the facilities and equipment necessary and appropriate to enable pupils to achieve the educational goals of the Arizona state schools for the deaf and the blind. The board shall establish minimum school facility adequacy guidelines applicable to the Arizona state schools for the deaf and the blind.
On or before June 15 of each year, electronically submit to the joint committee on capital review for its review detailed information regarding demographic assumptions, a proposed construction schedule and new school construction cost estimates for individual projects approved in the current fiscal year and expected project approvals for the upcoming fiscal year. A copy of the report shall also be submitted electronically to the governor's office of strategic planning and budgeting. The joint legislative budget committee staff, the governor's office of strategic planning and budgeting staff and the board staff shall agree on the format of the report.
On or before December 31 of each year, report to the joint legislative budget committee on all class B bond approvals by school districts in that year. Each school district shall report to the board on or before December 1 of each year information required by the board for the report prescribed in this paragraph.
Determine whether any interest disclosed pursuant to subsection D, paragraph 13 of this section is a substantial interest as defined in section 38-502 and maintain a record of all substantial interests that are identified pursuant to this paragraph.

D. The director of the division shall serve as the director of the school facilities oversight board. The director may hire and fire necessary staff subject to chapter 4, article 4 of this title and as approved by the legislature in the budget. The staff of the school facilities oversight board is exempt from chapter 4, articles 5 and 6 of this title. The director:

Shall analyze applications for monies submitted to the board and to the division by school districts.
Shall assist the board and the division in developing forms and procedures for distributing and reviewing applications and distributing monies to school districts.
May review or audit, or both, the expenditure of monies by a school district for deficiencies corrections and new school facilities.
Shall assist the board and the division in preparing the board's and division's annual reports.
Shall research and provide reports on issues of general interest to the board and the division.
May aid school districts in developing reasonable and cost-effective school designs in order to avoid statewide duplicated efforts and unwarranted expenditures in the area of school design.
May assist school districts in facilitating the development of multijurisdictional facilities.
Shall assist the board and the division in any other appropriate matter or method as directed by the division and the members of the board.
Shall establish procedures to ensure compliance with the notice and hearing requirements prescribed in section 15-905. The notice and hearing procedures adopted by the board shall include the requirement, with respect to the board's consideration of any application filed after July 1, 2001 or after December 31 of the year in which the property becomes territory in the vicinity of a military airport or ancillary military facility as defined in section 28-8461 for monies to fund the construction of new school facilities proposed to be located in territory in the vicinity of a military airport or ancillary military facility, that the military airport receive notification of the application by first class mail at least thirty days before any hearing concerning the application.
Shall expedite any request for monies in which the school district governing board submits an application that shows an immediate need for a new school facility.
Shall determine administrative completeness within one month after receiving an application from a school district for monies from the new school facilities fund.
Shall provide technical support to school districts as requested by school districts in connection with constructing new school facilities and maintaining existing school facilities and may contract directly with construction project managers pursuant to subsection B of this section. This paragraph does not restrict a school district from contracting with a construction project manager using district or state resources.
Shall require each employee of the school facilities oversight board to disclose in writing to the board at least once per year any interest that the employee has in any contract, sale, purchase, service or other transaction of the board or division or of a school district.

E. When appropriate, the board and the division shall review and use the statewide school facilities inventory and needs assessment conducted by the joint committee on capital review and issued in July 1995.

F. The school facilities oversight board shall contract with one or more private building inspectors to complete an initial assessment of school facilities and equipment and shall inspect each school building in this state at least once every five years to ensure compliance with section 41-5711. A copy of the inspection report, together with any recommendations for building maintenance, shall be provided to the school facilities oversight board and the governing board of the school district.

G. The division or the board, as applicable, may consider appropriate combinations of facilities or uses in assessing and curing deficiencies pursuant to subsection A, paragraph 1 of this section and in certifying plans for new school facilities pursuant to subsection C, paragraph 2 of this section.

H. The board shall not award any monies to fund new facilities that are financed by class A bonds that are issued by the school district.

I. The board or the division shall not distribute monies to a school district for replacing or repairing facilities if the costs associated with the replacement or repair are covered by insurance or a performance or payment bond.

J. The division may contract for construction services and materials that are necessary to correct existing deficiencies in school district facilities. The division may procure the construction services necessary pursuant to this subsection by any method, including construction-manager-at-risk, design-build, design-bid-build or job-order-contracting as provided by chapter 23 of this title. The construction planning and services performed pursuant to this subsection are exempt from section 41-791.01.

K. The division may enter into agreements with school districts to allow division staff and contractors access to school property for the purposes of performing the construction services necessary pursuant to subsection J of this section.

L. Each school district shall develop routine preventive maintenance guidelines for its facilities. The guidelines shall include plumbing systems, electrical systems, heating, ventilation and air conditioning systems, special equipment and other systems and for roofing systems shall recommend visual inspections performed by district staff for signs of structural stress and weakness. The guidelines shall be submitted to the division for review and approval. If on inspection by the division it is determined that a school district facility was inadequately maintained pursuant to the school district's routine preventive maintenance guidelines, the school district shall return the building to compliance with the school district's routine preventive maintenance guidelines.

M. The division may temporarily transfer monies, or, if applicable, the board may direct the division to transfer monies, between the emergency deficiencies correction fund established by section 41-5721 and the new school facilities fund established by section 41-5741 if all of the following conditions are met:

The transfer is necessary to avoid a temporary shortfall in the fund into which the monies are transferred.
The transferred monies are restored to the fund where the monies originated as soon as practicable after the temporary shortfall in the other fund has been addressed.
The board and the division report to the joint committee on capital review the amount of and the reason for any monies transferred.

N. After notifying each school district, and if a written objection from the school district is not received by the board or the division within thirty days after the notification, the board or the division may access public utility company records of power, water, natural gas, telephone and broadband usage to assemble consistent and accurate data on utility consumption at school facilities to determine the effectiveness of facility design, operation and maintenance measures intended to reduce energy and water consumption and costs. Any public utility that provides service to a school district in this state shall provide the data requested by the board or the division pursuant to this subsection.

O. The division or the board shall not require a common school district that provides instruction to pupils in grade nine to obtain approval from the division or the board to reconfigure its school facilities. A common school district that provides instruction to pupils in grade nine is not entitled to additional monies from the division or the board for facilities to educate pupils in grade nine.

P. A school district may appeal the denial of a request for monies pursuant to this chapter or any other appealable agency action by the division or the board pursuant to chapter 6, article 10 of this title. For the purposes of this subsection, "appealable agency action" has the same meaning prescribed in section 41-1092.

§ 41-5703 School facilities oversight board lease-to-own; fund; expiration

A. In order to fulfill the requirements of section 41-5741, the board may acquire school facilities for the use of one or more school districts by entering into one or more lease-to-own transactions in accordance with this section. For the purposes of this section, providing school facilities includes land acquisition, related infrastructure, fixtures, furnishings, equipment and costs of the lease-to-own transaction. The board may provide monies to provide school facilities in part pursuant to section 41-5741 and in part through a lease-to-own transaction.

B. A lease-to-own transaction may provide for:

The ground lease of the land for the facilities to a private entity for the term of the lease-to-own transaction or for a term of up to one and one-half times the term of the lease-to-own transaction, subject to earlier termination on completion of performance of the lease-to-own agreement. The ground lessor may either be the school district or the board, whichever holds title to the land.
The lease of the completed school facilities by a private entity to the board for an extended term of years pursuant to a lease-to-own agreement.
The sublease of the completed school facilities by the board to the school district during the term of the lease-to-own agreement. The sublease shall provide for the use, maintenance and operation of the school facilities by the school district and for the transfer of ownership of the school facilities to the school district on completion of performance of the lease-to-own agreement.
The option for the board's purchase of the school facilities and transfer of ownership of the school facilities to the school district before the expiration of the lease-to-own agreement.
The services of trustees, financial advisors, paying agents, transfer agents, underwriters, lawyers and other professional service providers, credit enhancements or liquidity facilities and all other services considered necessary by the board in connection with the lease-to-own transaction, and related agreements and arrangements including arrangements for the creation and sale of certificates of participation evidencing proportionate interests in the lease payments to be made by the board pursuant to the lease-to-own agreement.

C. The sublease of the school facilities to the school district is subject to this section and to the provisions of the lease-to-own agreement. Neither a ground lease by the school district as lessor nor a sublease of the school facilities to the school district is required to be authorized by a vote of the school district electors. A ground lease is not subject to any limitations or requirements applicable to leases or lease-purchase agreements pursuant to section 15-342 or any other section of title 15 or this chapter.

D. Any school facility that is constructed through a lease-to-own agreement shall meet the minimum building adequacy standards set forth in section 41-5711.

E. School districts may use local monies to exceed the minimum adequacy standards and to build athletic fields and any other capital project for leased-to-own facilities.

F. The board shall include any square footage of new school facilities constructed through lease-to-own agreements in the computations prescribed in section 41-5711.

G. The lease-to-own fund is established consisting of monies appropriated by the legislature. The board shall administer the fund and distribute monies in the fund to make payments pursuant to lease-to-own agreements entered into by the board pursuant to this section, to make payments to or for the benefit of school districts pursuant to local lease-to-own agreements entered into by school districts pursuant to section 41-5704 and to pay costs considered necessary by the board in connection with lease-to-own transactions and local lease-to-own transactions. Payments by the board pursuant to a lease-to-own agreement or local lease-to-own agreement shall be made only from the lease-to-own fund. On notice from the board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the lease-to-own fund.

H. A lease-to-own agreement entered into by the board pursuant to this section shall provide that:

At the completion of the lease-to-own agreement, ownership of the school facilities and land associated with the lease-to-own agreement shall be transferred to the school district as specified in the agreement.
The obligation of the board to make any payment under the lease-to-own agreement is a current expense, payable exclusively from appropriated monies, and is not a general obligation indebtedness of this state or the board. The obligation of a school district to make expenditures under a sublease pursuant to subsection B, paragraph 3 of this section is a current expense, payable exclusively from budgeted monies, and is not a general obligation indebtedness of the school district.
If the legislature fails to appropriate monies or the board fails to allocate such monies for any periodic payment or renewal term of the lease-to-own agreement, the lease-to-own agreement terminates at the end of the current term and this state and the board are relieved of any subsequent obligation under the agreement and the school district is relieved of any subsequent obligation under the sublease.
The lease-to-own agreement shall be reviewed and approved by the attorney general before the agreement may take effect.
Before the agreement takes effect and after review by the attorney general, the project or projects related to the agreement shall be submitted for review by the joint committee on capital review.

I. The board may covenant to use its best efforts to budget, obtain, allocate and maintain sufficient appropriated monies to make payments under a lease-to-own agreement, but the lease-to-own agreement shall acknowledge that appropriating state monies is a legislative act and is beyond the control of the board or of any other party to the lease-to-own agreement.

J. The land and the school facilities on the land are exempt from taxation during the term of the lease-to-own agreement and during construction and subsequent occupancy by the school district pursuant to the sublease.

K. The powers prescribed in this section are in addition to the powers conferred by any other law. Without reference to any other provision of title 15, this chapter or any other law, this section is authority for the completion of the purposes prescribed in this section for the board to provide school facilities for use by school districts through lease-to-own transactions pursuant to this section without regard to the procedure required by any other law. Except as otherwise provided in this section, the provisions of title 15 and this chapter that relate to the matters contained in this section are superseded because this section is the exclusive law on these matters.

L. The board shall not enter into lease-to-own transactions, including any refinancings or refundings, pursuant to this section from and after May 15, 2006.

§ 41-5704 Local lease-to-own by school districts; expiration

A. In order to fulfill the requirements of section 41-5741, with the approval of the board, a school district may acquire school facilities by entering into a local lease-to-own transaction in accordance with this section. For purposes of this section, providing school facilities includes land acquisition, related infrastructure, fixtures, furnishings, equipment and costs of the local lease-to-own transaction. The board may provide monies to provide school facilities in part pursuant to section 41-5741 and in part through payments to or for the benefit of a school district for a local lease-to-own transaction.

B. A local lease-to-own transaction may provide for:

The ground lease of the land for the facilities to a private entity for the term of the local lease-to-own transaction or for a term of up to one and one-half times the term of the local lease-to-own transaction, subject to earlier termination on completion of performance of the local lease-to-own agreement. The ground lessor may either be the school district or the board, whichever holds title to the land.
The lease of the completed school facilities by a private entity to the school district for an extended term of years pursuant to a local lease-to-own agreement. The local lease-to-own agreement shall provide for the use, maintenance and operation of the school facilities by the school district and for the transfer of ownership of the school facilities to the school district on completion of performance of the local lease-to-own agreement.
The option for the school district's purchase of the school facilities and transfer of ownership of the school facilities to the school district before the expiration of the local lease-to-own agreement.
The services of trustees, financial advisors, paying agents, transfer agents, underwriters, lawyers and other professional service providers, credit enhancements or liquidity facilities and all other services considered necessary by the school district or the board in connection with the local lease-to-own transaction, and related agreements and arrangements including arrangements for the creation and sale of certificates of participation evidencing proportionate interests in the lease payments to be made by the school district pursuant to the local lease-to-own agreement.

C. Neither a ground lease by the school district as lessor nor a local lease-to-own agreement is required to be authorized by a vote of the school district electors. A ground lease is not subject to any limitations or requirements applicable to leases or lease-purchase agreements pursuant to section 15-342 or any other section of title 15 or this chapter.

D. The board may make payments to or for the benefit of the school district from the lease-to-own fund established by section 41-5703 for the payment of amounts payable under the local lease-to-own agreement.

E. Any school facility that is constructed through a lease-to-own agreement shall meet the minimum building adequacy standards set forth in section 41-5711.

F. School districts may use local monies to exceed the minimum adequacy standards and to build athletic fields and any other capital project for leased-to-own facilities.

G. The board shall include any square footage of new school facilities constructed through lease-to-own agreements in the computations prescribed in section 41-5711.

H. A local lease-to-own agreement entered into by a school district pursuant to this section shall provide that:

At the completion of the lease-to-own agreement, ownership of the school facilities and land associated with the lease-to-own agreement shall be transferred to the school district as specified in the agreement.
The obligation of the school district to make any payment or expenditure under the local lease-to-own agreement is a current expense, payable exclusively from properly budgeted monies, and is not a general obligation indebtedness of this state, the board or the school district, and that any payment by the board to or for the benefit of the school district from the lease-to-own fund established by section 41-5703 for payments of amounts payable under the local lease-to-own agreement is a current expense, payable exclusively from appropriated monies, and is not a general obligation indebtedness of this state or the board.
If the school district fails to properly budget for payments under the local lease-to-own agreement or if the legislature fails to appropriate monies or the board fails to allocate monies for periodic payment to or for the benefit of the school district for payments under the local lease-to-own agreement, the local lease-to-own agreement terminates at the end of the current term and the school district, the board and this state are relieved of any subsequent obligation under the local lease-to-own agreement.
The local lease-to-own agreement shall be reviewed and approved by the attorney general before the agreement may take effect.
Before the agreement takes effect and after review by the attorney general, the project or projects related to the agreement shall be submitted for review by the joint committee on capital review.

I. The school district may covenant to use its best efforts to budget, obtain, allocate and maintain sufficient monies to make payments under a local lease-to-own agreement, but the local lease-to-own agreement shall acknowledge that budgeting school district monies is a governmental act of the school district governing board that may not be contracted away. The school facilities oversight board is not required to covenant to budget, obtain, allocate or maintain sufficient monies in the lease-to-own fund to make payments to or for the benefit of a school district for payments under a local lease-to-own agreement.

J. The land and the school facilities on the land are exempt from taxation during the term of the local lease-to-own agreement and during construction and subsequent occupancy by the school district pursuant to the local lease-to-own agreement.

K. The powers prescribed in this section are in addition to the powers conferred by any other law. Without reference to any other provision of title 15 or this chapter or any other law, this section is authority for the completion of the purposes prescribed in this section for school districts to provide school facilities through local lease-to-own transactions pursuant to this section without regard to the procedure required by any other law. Except as otherwise provided in this section, the provisions of title 15 or this chapter that relate to the matters contained in this section are superseded because this section is the exclusive law on these matters.

L. School districts shall not enter into lease-to-own transactions, including any refinancings or refundings, pursuant to this section from and after May 15, 2006.

§ 41-5705 Lease-to-own amount; expiration

A. In order to fulfill the requirements of section 41-5741, the board may enter into lease-to-own transactions for up to a maximum of $200,000,000 in any fiscal year.

B. The board shall not enter into lease-to-own transactions, including any refinancings or refundings, pursuant to this section from and after May 15, 2006.

Article 2 Building Adequacy Standards

§ 41-5711 Minimum school facility adequacy requirements; definition

A. The board, as determined and prescribed in this chapter, shall provide funding to school districts for new construction as the number of pupils in the district fills the existing school facilities and requires more pupil space.

B. School buildings in a school district are adequate if all of the following requirements are met:

The buildings contain sufficient and appropriate space and equipment that comply with the minimum school facility adequacy guidelines established pursuant to subsection F of this section. The state shall not fund facilities for elective courses that require the school district facilities to exceed minimum school facility adequacy requirements. The board shall determine whether a school building meets the requirements of this paragraph by analyzing the total square footage that is available for each pupil in conjunction with the need for specialized spaces and equipment.
The buildings are in compliance with federal, state and local building and fire codes and laws that apply to the particular building, except that a school with an aggregate area of less than five thousand square feet is subject to permitting and inspection by a local fire marshal and is only subject to regulation or inspection by the office of the state fire marshal if the county, city or town in which the school is located does not employ a local fire marshal. An existing school building is not required to comply with current requirements for new buildings unless this compliance is specifically mandated by law or by the building or fire code of the jurisdiction where the building is located.
The building systems, including roofs, plumbing, telephone systems, electrical systems, heating systems and cooling systems, are in working order and are capable of being properly maintained.
The buildings are structurally sound.

C. The standards that shall be used by the board to determine whether a school building meets the minimum adequate gross square footage requirements are as follows:

For a school district that provides instruction to pupils in programs for preschool children with disabilities, kindergarten programs and grades one through six, eighty square feet per pupil in programs for preschool children with disabilities, kindergarten programs and grades one through six.
For a school district that provides instruction to up to eight hundred pupils in grades seven and eight, eighty-four square feet per pupil in grades seven and eight.
For a school district that provides instruction to more than eight hundred pupils in grades seven and eight, eighty square feet per pupil in grades seven and eight or sixty-seven thousand two hundred square feet, whichever is more.
For a school district that provides instruction to up to four hundred pupils in grades nine through twelve, one hundred twenty-five square feet per pupil in grades nine through twelve.
For a school district that provides instruction to more than four hundred and up to one thousand pupils in grades nine through twelve, one hundred twenty square feet per pupil in grades nine through twelve or fifty thousand square feet, whichever is more.
For a school district that provides instruction to more than one thousand and up to one thousand eight hundred pupils in grades nine through twelve, one hundred twelve square feet per pupil in grades nine through twelve or one hundred twenty thousand square feet, whichever is more.
For a school district that provides instruction to more than one thousand eight hundred pupils in grades nine through twelve, ninety-four square feet per pupil in grades nine through twelve or two hundred one thousand six hundred square feet, whichever is more.

D. The board may modify the square footage requirements prescribed in subsection C of this section or modify the amount of monies awarded to cure the square footage deficiency pursuant to this section for particular school districts based on extraordinary circumstances for any of the following considerations:

The number of pupils served by the school district.
Geographic factors.
Grade configurations other than those prescribed in subsection C of this section.

E. In measuring the square footage per pupil requirements of subsection C of this section, the board shall:

Use the projected one hundredth day average daily membership for the current school year.
For each school, use the lesser of either:

(a) Total gross square footage.

(b) Student capacity multiplied by the appropriate square footage per pupil prescribed by subsection C of this section.

Consider the total space available in all schools in use in the school district, except that the board shall allow an exclusion of the square footage for certain schools and the pupils within the schools' boundaries if the school district demonstrates to the board's satisfaction unusual or excessive busing of pupils or unusual attendance boundary changes between schools.
Compute the gross square footage of all buildings by measuring from exterior wall to exterior wall. Square footage used solely for district administration, storage of vehicles and other nonacademic purposes shall be excluded from the net square footage.
Include all portable and modular buildings.
Include in the net square footage new construction funded wholly or partially by the board based on the square footage funded by the board. If the new construction is to exceed the square footage funded by the board, the excess square footage shall not be included in the net square footage if any of the following applies:

(a) The excess square footage was constructed before July 1, 2002 or funded by a class B bond, impact aid revenue bond or capital outlay override approved by the voters after August 1, 1998 and before June 30, 2002 or funded from unrestricted capital outlay expended before June 30, 2002.

(b) The excess square footage of new school facilities does not exceed twenty-five percent of the minimum square footage requirements pursuant to subsection C of this section.

(c) The excess square footage of expansions to school facilities does not exceed twenty-five percent of the minimum square footage requirements pursuant to subsection C of this section.

Exclude square footage built under a developer agreement according to section 15-342, paragraph 33 until the board provides funding for the square footage under section 41-5741, subsection O.
Include square footage that a school district has leased to another entity.

F. The board shall adopt rules establishing minimum school facility adequacy guidelines. The guidelines shall provide the minimum quality and quantity of school buildings and facilities and equipment necessary and appropriate to enable pupils to achieve the academic standards pursuant to section 15-203, subsection A, paragraphs 12 and 13 and sections 15-701 and 15-701.01. At a minimum, the board shall address all of the following in developing these guidelines:

School sites.
Classrooms.
Libraries and media centers, or both.
Cafeterias.
Auditoriums, multipurpose rooms or other multiuse space.
Technology.
Transportation.
Facilities for science, arts and physical education.
Other facilities and equipment that are necessary and appropriate to achieve the academic standards prescribed pursuant to section 15-203, subsection A, paragraphs 12 and 13 and sections 15-701 and 15-701.01.
Appropriate combinations of facilities or uses listed in this section.

G. The board may convene subcommittees as needed on specific issues, including school facility safety standards. Notwithstanding any other law, a school district that receives grant monies from the building renewal grant fund established by section 41-5731 or monies from the new school facilities fund established by section 41-5741 shall consider school facility safety standards when completing approved projects or constructing new school facilities with monies received from those funds.

H. The board shall consider the facilities and equipment of the schools with the highest academic productivity scores, as prescribed in section 41-5702, subsection A, paragraph 6, subdivision (d), and the highest parent quality ratings in the establishment of the guidelines.

I. The board may consider appropriate combinations of facilities or uses in assessing and curing existing deficiencies pursuant to section 41-5702, subsection A, paragraph 1 and in certifying plans for new school facilities pursuant to section 41-5702, subsection C, paragraph 2.

J. If the board makes any changes to the minimum adequacy requirements prescribed in this section, the board shall provide a fiscal impact statement of the effect of the proposed changes to the joint committee on capital review for review.

K. For the purposes of this section, "student capacity" means the capacity adjusted to include any additions to or deletions of space, including modular or portable buildings at the school. The board shall determine the student capacity for each school in conjunction with each school district, recognizing each school's allocation of space as of July 1, 1998, to achieve the academic standards prescribed pursuant to section 15-203, subsection A, paragraphs 12 and 13 and sections 15-701 and 15-701.01.

Article 3 Deficiencies Correction

§ 41-5721 Emergency deficiencies correction fund; definition

A. The emergency deficiencies correction fund is established consisting of monies transferred from the new school facilities fund established by section 41-5741. The division shall administer the emergency deficiencies correction fund and distribute monies in accordance with the rules of the division to school districts for emergency purposes. The division shall not transfer monies from the new school facilities fund if the division, in conjunction with the school facilities oversight board, determines that the transfer will affect, interfere with, disrupt or reduce any capital projects that the board has approved pursuant to section 41-5741. The division shall transfer to the emergency deficiencies correction fund the amount necessary each fiscal year to fulfill the requirements of this section. Within thirty days after transferring monies to the emergency deficiencies correction fund, the division shall report to the director of the joint legislative budget committee and the director of the governor's office of strategic planning and budgeting the amount and source of the transfer. Monies in the emergency deficiencies correction fund are continuously appropriated and are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. If the division determines that there are insufficient monies in the emergency deficiencies correction fund to correct an emergency, the school district may correct the emergency pursuant to section 15-907.

C. If a school district has an emergency, the school district shall apply to the division for funding for the emergency. The school district's application shall disclose any insurance or building renewal monies available to the school district to pay for the emergency. Before applying to the division for funding for the emergency, the school district governing board shall issue an emergency declaration or resolution to be eligible for monies from the emergency deficiencies correction fund.

D. The division staff shall acknowledge receipt of the school district's application for emergency deficiencies funding in writing within five business days after receiving the application. The division staff shall include in the written acknowledgement of receipt to the school district any investigative, study or informational requirements from the school district, along with an estimated timeline to complete the requirements, necessary for the division staff to make a decision regarding funding.

E. The board shall review all policies and procedures that the division develops to administer this section.

F. For the purposes of this section, "emergency":

Means a serious need for materials, services or construction or expenses that exceeds the school district's adopted budget for the current fiscal year and that seriously threatens the functioning of the school district, the preservation or protection of property or public health, welfare or safety.
Includes all of the following:

(a) A situation that threatens life services such as adequate water supply, energy and wastewater.

(b) A situation in which a school district is under orders from an authority having jurisdiction for an unsafe environment such as the department of environmental quality, the occupational safety and health administration or the state fire marshal.

(c) The school district receives a professional and certified assessment showing that one or more facilities or systems are structurally unsafe and directly impact the functions of the school district with no alternative option available.

Article 4 Building Renewal

§ 41-5731 Building renewal grant fund; rules; annual report; definitions

A. The building renewal grant fund is established consisting of monies appropriated to the fund by the legislature. The division shall administer the fund and distribute monies to school districts for the purpose of maintaining the adequacy of existing school facilities. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

B. The division shall distribute monies from the building renewal grant fund based on grant requests from school districts to fund primary building renewal projects. Project requests shall be prioritized by the division, with priority given to school districts that have provided routine preventive maintenance on the facility. A school district must submit a preventive maintenance plan to the division to be eligible to receive monies from the building renewal grant fund. The division shall approve only projects that will be completed within twelve months, unless similar projects on average take longer to complete. A grant issued under this section expires twelve months after the grant request is approved unless the division issues an extension, except that if the division approves a project and determines that similar projects on average take longer than twelve months to complete, the division shall extend the grant expiration date based on the average amount of time that similar projects take to complete. The division shall establish a process by which a school district may request an extension under this subsection. On expiration of a grant, a school district shall return any building renewal grant fund monies that the school district has not spent to the division for deposit in the building renewal grant fund. The division may spend monies from the fund for assessments to determine whether a grant from the fund is warranted under this section.

C. School districts that receive monies from the building renewal grant fund shall use these monies on projects for buildings or any part of a building in the division's database for any of the following:

Major renovations and repairs to a building that is used for student instruction or other academic purposes.
Upgrading systems and areas that will maintain or extend the useful life of the building.
Infrastructure costs.

D. Monies received from the fund shall not be used for any of the following purposes:

New construction.
Remodeling interior space for aesthetic or preferential reasons.
Exterior beautification.
Demolition.
Routine preventive maintenance.
Any project in a building, or part of a building, that is being leased to another entity.

E. Accommodation schools are not eligible for monies from the building renewal grant fund.

F. If the division or a court of competent jurisdiction determines that a school district received monies from the building renewal grant fund that must be reimbursed to the division due to legal action associated with improper construction by a hired contractor, the school district shall reimburse the division an agreed-on amount for deposit into the building renewal grant fund.

G. The division shall categorize each project that is eligible for monies from the building renewal grant fund as either critical or noncritical. The division shall adopt policies and procedures to prioritize critical projects and to designate critical projects as projects that immediately impact student safety or building closures or that result in operational disruptions. Critical projects have priority over any previously approved noncritical projects.

H. If the division determines that sufficient monies are not available for a noncritical project that the division has approved, the division shall notify the school district that submitted the project request that monies will be distributed from the building renewal grant fund for the project only if the legislature appropriates sufficient monies. If sufficient monies are not available in the fiscal year in which the project is awarded for a noncritical project, the noncritical project does not receive priority in the next fiscal year.

I. Building renewal grants pursuant to this section shall be used only for projects that serve an academic purpose.

J. The division shall do both of the following:

Implement policies and procedures to require a school district to report the preventive maintenance activities completed during the previous twelve months for the facility for which the monies are being requested.
Submit a monthly report to the school facilities oversight board that details how monies from the building renewal grant fund have been distributed.

K. In addition to establishing a project eligibility assessment under section 41-5702, subsection A, paragraph 5, subdivision (b), the division shall adopt rules regarding both of the following:

The approval of building renewal grants pursuant to this section.
Time frames for the division regarding all of the following with respect to this section:

(a) Approving or denying grant requests for critical projects.

(b) Notifying an applicant if the applicant's application is incomplete.

(d) Distributing monies from the building renewal grant fund.

L. The board shall review all policies and procedures that the division develops to administer this section.

M. The division may spend monies from the fund for assessments to determine if a grant from the fund is warranted under this section.

N. On or before June 30 of each year, the division shall submit a report to the joint legislative budget committee and the governor's office of strategic planning and budgeting on any unobligated monies in the building renewal grant fund.

O. For the purposes of this section:

"Primary building renewal projects" means projects that are necessary for buildings owned by school districts that are required to meet the minimum adequacy standards for student capacity and that fall below the minimum school facility adequacy guidelines, as adopted by the board pursuant to section 41-5711, for school districts that have provided routine preventive maintenance to the school facility.
"Routine preventive maintenance" means services that are performed on a regular schedule at intervals ranging from four times a year to once every three years, or on the schedule of services recommended by the manufacturer of the specific building system or equipment, and that are intended to extend the useful life of a building system and reduce the need for major repairs.
"Student capacity" has the same meaning prescribed in section 41-5711.

Article 5 New School Facilities

§ 41-5741 New school facilities fund; capital plan; reporting requirements

A. The new school facilities fund is established consisting of monies appropriated by the legislature and monies credited to the new school facilities fund pursuant to section 37-221. The division shall administer the new school facilities fund and, at the direction of the school facilities oversight board, shall distribute monies, as a continuing appropriation, to school districts for the purpose of constructing new school facilities and for contracted expenses pursuant to section 41-5702, subsection B, paragraphs 2, 3 and 4.

B. The school facilities oversight board shall prescribe a uniform format for use by the school district governing board in developing and annually updating a capital plan that consists of each of the following:

Enrollment projections for the next five years for elementary schools and eight years for middle and high schools, including a description of the methods used to make the projections.
A description of new schools or additions to existing schools needed to meet the building adequacy standards prescribed in section 41-5711. The description shall include:

(a) The grade levels and the total number of pupils that the school or addition is intended to serve.

(b) The year in which it is necessary for the school or addition to begin operations.

Long-term projections of the need for land for new schools.
Any other necessary information required by the school facilities oversight board to evaluate a school district's capital plan.
If a school district pays tuition for all or a portion of the school district's high school pupils to another school district, the capital plan shall indicate the number of pupils for which the district pays tuition to another district. If a school district accepts pupils from another school district pursuant to section 15-824, subsection A, the school district shall indicate the projections for this population separately. This paragraph does not apply to a small isolated school district as defined in section 15-901.

C. If the capital plan indicates a need for a new school or an addition to an existing school within the next four years or a need for land within the next ten years, the school district shall submit its plan to the school facilities oversight board on or before September 1 and shall request monies from the new school facilities fund for the new construction or land. The board may require a school district to sell land that was previously purchased entirely with monies provided by the board if the board determines that the property is no longer needed within the ten-year period specified in this subsection for a new school or no longer needed within that ten-year period for an addition to an existing school. Monies provided for land are in addition to any monies provided pursuant to subsection D of this section.

D. At the direction of the board, the division shall distribute monies from the new school facilities fund for additional square footage as follows:

The board shall review and evaluate the enrollment projections. On or before December 15 of each year, following the submission of the enrollment projections, the board shall either approve the projections as submitted or revise the projections. In approving or revising the enrollment projections, the board shall use the average daily membership data available during the current school year. On request from the board, the department of education shall make available the most recent average daily membership data for use in revising the enrollment projections. In determining new construction requirements, the board shall determine the net new growth of pupils that will require additional square footage that exceeds the building adequacy standards prescribed in section 41-5711. If the projected growth and the existing number of pupils exceed three hundred fifty pupils who are served in a school district other than the pupil's resident school district, the board, the receiving school district and the resident school district shall develop a capital facilities plan on how to best serve those pupils. A small isolated school district as defined in section 15-901 is not required to develop a capital facilities plan pursuant to this paragraph.
If the average daily membership projections indicate that additional space will not be needed within the next two school years in order to meet the building adequacy standards prescribed in section 41-5711, the request shall be held for consideration by the board for possible future funding and the school district shall annually submit an updated plan until the additional space is needed.
If the average daily membership projections indicate that additional space will be needed within the next two school years in order to meet the building adequacy standards prescribed in section 41-5711, the board shall provide an amount as follows:

(a) Determine the number of pupils requiring additional square footage to meet building adequacy standards. This amount for elementary schools shall not be less than the number of new pupils for whom space will be needed in the next year and shall not exceed the number of new pupils for whom space will be needed in the next five years. This amount for middle and high schools shall not be less than the number of new pupils for whom space will be needed in the next four years and shall not exceed the number of new pupils for whom space will be needed in the next eight years.

(b) Multiply the number of pupils determined in subdivision (a) of this paragraph by the square footage per pupil. The square footage per pupil is ninety square feet per pupil for preschool children with disabilities, kindergarten programs and grades one through six, one hundred square feet for grades seven and eight, one hundred thirty-four square feet for a school district that provides instruction in grades nine through twelve for fewer than one thousand eight hundred pupils and one hundred twenty-five square feet for a school district that provides instruction in grades nine through twelve for at least one thousand eight hundred pupils. The total number of pupils in grades nine through twelve in the district shall determine the square footage factor to use for net new pupils. The board may modify the square footage requirements prescribed in this subdivision for particular schools based on any of the following factors:

(i) The number of pupils served or projected to be served by the school district.

(ii) Geographic factors.

(iii) Grade configurations other than those prescribed in this subdivision.

(iv) Compliance with minimum school facility adequacy requirements established pursuant to section 41-5711.

(c) Multiply the product obtained in subdivision (b) of this paragraph by the cost per square foot. The cost per square foot is $270.24 for preschool children with disabilities, kindergarten programs and grades one through six, $285.30 for grades seven and eight and $330.30 for grades nine through twelve. The cost per square foot shall be adjusted annually for construction market considerations based on an index identified or developed by the joint legislative budget committee as necessary but not less than once each year. Each annual construction market adjustment applies to all projects approved by the school facilities board under this subsection during that year. The board shall multiply the cost per square foot by 1.05 for any school district located in a rural area. The board may only modify the base cost per square foot prescribed in this subdivision for particular schools based on geographic conditions or site conditions. Any extra monies received as a result of a modification based on geographic conditions or site conditions may be used to address unforeseen costs at any stage of a project under this section. For the purposes of this subdivision, "rural area" means an area outside a thirty-five-mile radius of a boundary of a municipality with a population of more than fifty thousand persons.

(d) Once the school district governing board obtains approval from the board for new facility construction monies, additional portable or modular square footage created for the express purpose of providing temporary space for pupils until the completion of the new facility and any additional space funded by the school district shall not be included by the board for the purpose of new construction funding calculations. On completion of the new facility construction project, any additional space funded by the school district shall be included as prescribed by this chapter and, if the portable or modular facilities continue in use, the portable or modular facilities shall be included as prescribed by this chapter, unless the board approves their continued use for the purpose of providing temporary space for pupils until the completion of the next new facility that has been approved for funding from the new school facilities fund.

For projects approved after December 31, 2001, and notwithstanding paragraph 3 of this subsection, a unified school district that does not have a high school is not eligible to receive high school space as prescribed by section 41-5711 and this section unless the unified district qualifies for geographic factors prescribed by paragraph 3, subdivision (b), item (ii) of this subsection.
If a career technical education district leases a building from a school district, that building shall be included in the school district's square footage calculation for the purposes of new construction pursuant to this section.
If a school district leases a building to another entity, that building shall be included in the school district's square footage calculation for purposes of new construction pursuant to this section.
A school district shall qualify for monies from the new school facilities fund for additional square footage in a fiscal year only if the board has approved or revised its enrollment projection under paragraph 1 of this subsection on or before December 15 of the prior fiscal year.

E. Monies for architectural and engineering fees, project management services and preconstruction services shall be distributed on the completion of the analysis by the board of the school district's request. After receiving monies pursuant to this subsection, the school district shall submit a design development plan for the school or addition to the board before any monies for construction are distributed. If the school district's request meets the building adequacy standards, the board may review and comment on the district's plan with respect to the efficiency and effectiveness of the plan in meeting state square footage and facility standards before directing the distribution of the remainder of the monies. If the board modifies the cost per square foot as prescribed in subsection D, paragraph 3, subdivision (c) of this section, the board may deduct the cost of project management services and preconstruction services from the required cost per square foot. The board may decline to fund the project if the square footage is no longer required due to revised enrollment projections. The board may decline a portion of the funding if a portion of the square footage is no longer needed due to revised enrollment projections.

F. At the direction of the board, the division shall distribute the monies needed for land for new schools so that land may be purchased at a price that is less than or equal to fair market value and in advance of the construction of the new school. If necessary, the board may direct the division to distribute monies for land to be leased for new schools if the duration of the lease exceeds the life expectancy of the school facility by at least fifty percent. A school district shall not use land purchased or partially purchased with monies provided at the direction of the board for a purpose other than a site for a school facility without obtaining prior written approval from the board. A school district shall not lease, sell or take any action that would diminish the value of land purchased or partially purchased with monies provided at the direction of the board without obtaining prior written approval from the board. The proceeds derived through the sale of any land purchased or partially purchased, or the sale of buildings funded or partially funded, with monies provided at the direction of the board shall be returned to the state fund from which it was appropriated and to any other participating entity on a proportional basis. Except as provided in section 15-342, paragraph 33, if a school district acquires real property by donation at an appropriate school site approved by the board, the board shall direct the division to distribute an amount equal to twenty percent of the fair market value of the donated real property that can be used for academic purposes. The school district shall place the monies in the unrestricted capital outlay fund and increase the unrestricted capital budget limit by the amount of monies placed in the fund. Monies distributed under this subsection shall be distributed from the new school facilities fund. A school district that receives monies from the new school facilities fund for a donation of land pursuant to section 15-342, paragraph 33 shall not receive monies from the board or the division for the donation of real property pursuant to this subsection. A school district shall not pay a consultant a percentage of the value of any of the following:

Donations of real property, services or cash from any of the following:

(a) Entities that have offered to provide construction services to the school district.

(b) Entities that have been contracted to provide construction services to the school district.

(d) Entities that develop land for residential use in that school district.

Monies received under this chapter on behalf of the school district.
Monies paid by or at the direction of the board on behalf of the school district.

G. In addition to distributions to school districts based on pupil growth projections, a school district may submit an application to the board for monies from the new school facilities fund if one or more school buildings have outlived their useful life or have been condemned. If the board determines that the school district needs to build a new school building for these reasons, the board shall remove the square footage computations that represent the building from the computation of the school district's total square footage for purposes of this section. If the square footage recomputation reflects that the school district no longer meets building adequacy standards, the school district qualifies for a distribution of monies from the new school construction formula in an amount determined pursuant to subsection D of this section. The board may only modify the base cost per square foot prescribed in this subsection under extraordinary circumstances for geographic factors or site conditions.

H. School districts that receive monies from the new school facilities fund shall establish a district new school facilities fund and shall use the monies in the district new school facilities fund only for the purposes prescribed in this section. By October 15 of each year, each school district shall report to the board the projects funded at each school in the previous fiscal year with monies from the district new school facilities fund and shall provide an accounting of the monies remaining in the new school facilities fund at the end of the previous fiscal year.

I. If a school district has surplus monies received from the new school facilities fund, the school district may use the surplus monies only for capital purposes for the project for up to one year after completion of the project. If the school district possesses surplus monies from the new school construction project that have not been expended within one year of the completion of the project, the school district shall return the surplus monies to the division for deposit in the new school facilities fund.

J. The board's consideration of any application filed after December 31 of the year in which the property becomes territory in the vicinity of a military airport or ancillary military facility as defined in section 28-8461 for monies to fund the construction of new school facilities proposed to be located in territory in the vicinity of a military airport or ancillary military facility shall include, if after notice is transmitted to the military airport pursuant to section 41-5702 and before the public hearing the military airport provides comments and an analysis concerning compatibility of the proposed school facilities with the high noise or accident potential generated by military airport or ancillary military facility operations that may have an adverse effect on public health and safety, consideration and an analysis of the comments and an analysis provided by the military airport before making a final determination.

K. If a school district uses its own project manager for new school construction, the members of the school district governing board and the project manager shall sign an affidavit stating that the members and the project manager understand and will follow the minimum adequacy requirements prescribed in section 41-5711.

L. The division shall establish a separate account in the new school facilities fund designated as the litigation account to pay attorney fees, expert witness fees and other costs associated with litigation in which the board pursues the recovery of damages for deficiencies correction that resulted from alleged construction defects or design defects that the board believes caused or contributed to a failure of the school building to conform to the building adequacy requirements prescribed in section 41-5711. Attorney fees paid pursuant to this subsection shall not exceed the market rate for similar types of litigation. On or before December 1 of each year, the board shall report to the joint committee on capital review the costs associated with current and potential litigation that may be paid from the litigation account.

M. Until the state board of education and the auditor general adopt rules pursuant to section 15-213, subsection J, the board may allow school districts to contract for construction services and materials through the qualified select bidders list method of project delivery for new school facilities pursuant to this section.

N. The board shall submit electronically a report on project management services and preconstruction services to the governor, the president of the senate and the speaker of the house of representatives by December 31 of each year. The report shall compare projects that use project management and preconstruction services with those that do not. The report shall address cost, schedule and other measurable components of a construction project. School districts, construction-manager-at-risk firms and project management firms that participate in a board-funded project shall provide the information required by the board in relation to this report.

O. If a school district constructs new square footage according to section 15-342, paragraph 33, the board shall review the design plans and location of any new school facility submitted by school districts and another party to determine whether the design plans comply with the adequacy standards prescribed in section 41-5711 and the square footage per pupil requirements pursuant to subsection D, paragraph 3, subdivision (b) of this section. When the school district qualifies for a distribution of monies from the new school facilities fund according to this section, the board shall direct the division to distribute monies to the school district from the new school facilities fund for the square footage constructed under section 15-342, paragraph 33 at the same cost per square foot established by this section that was in effect at the time of the beginning of the construction of the school facility. Before the board directs the division to distribute any monies pursuant to this subsection, the school district shall demonstrate to the board that the facilities to be funded pursuant to this section meet the minimum adequacy standards prescribed in section 41-5711. The agreement entered into pursuant to section 15-342, paragraph 33 shall set forth the procedures for the allocation of these funds to the parties that participated in the agreement.

P. Accommodation schools are not eligible for monies from the new school facilities fund.

Q. If the board approves a school district for funding from the new school facilities fund and the full legislative appropriation is not available to the school district in the fiscal year following the approval by the board, the school district may use any legally available monies to pay for the land or the new construction project approved by the board and may reimburse the fund from which the monies were used in subsequent years with legislative appropriations when those appropriations are made available by this state.

Article 6 State School Facilities Revenue Bonds

§ 41-5751 Authorization of state school facilities revenue bonds

A. The board may issue negotiable revenue bonds pursuant to this article. If authorized by the legislature, bonds may be issued under this article in a principal amount not exceeding $200,000,000 in a fiscal year to:

Provide monies to pay the cost of:

(a) Acquiring real property and constructing new school facilities as provided by section 41-5741.

(b) Bond related expenses including any expenses incurred by the board to issue and administer its bonds including underwriting fees and costs, trustee fees, financial consultant fees, printing and advertising costs, paying agent fees, transfer agent fees, legal, accounting, feasibility consultant and other professional fees and expenses, bond insurance or other credit enhancements or liquidity facilities, attorney and accounting fees and expenses related to credit enhancement, bond insurance or liquidity enhancement, remarketing fees, rating agency fees and costs, travel and telephone expenses and all other fees considered necessary by the board in order to market and administer the bonds.

Fully or partially fund any reserves or sinking accounts established by the bond resolution.

B. The board shall authorize the bonds by resolution. The resolution shall prescribe:

The fixed or variable rate or rates of interest, the date or dates on which interest is payable and the denominations of the bonds.
The date or dates of the bonds and maturity, within ten years after the date of issuance.
The form of the bonds.
The manner of executing the bonds.
The medium and place of payment.
The terms of redemption, which may provide for a premium for early redemption.

C. The bonds issued pursuant to this article shall be known as state school facilities revenue bonds.

§ 41-5752 Issuance and sale of revenue bonds

A. The board shall issue the bonds in the number and amount provided in the resolution.

B. The bonds shall be sold at public or private sale at the price and on the terms prescribed in the resolution at, above or below par.

C. The net proceeds of the sale of the bonds shall be deposited in the revenue bond proceeds fund established pursuant to section 41-5753.

§ 41-5753 School facilities revenue bond proceeds fund; use for new school facilities

A. If the board issues revenue bonds under this article, the board shall establish a school facilities revenue bond proceeds fund consisting of the net proceeds received from the sale of the bonds.

B. The board may use monies in the school facilities revenue bond proceeds fund only for the purposes provided in section 41-5751, subsection A. Monies in the revenue bond proceeds fund are exempt from lapsing under section 35-190.

C. The state treasurer or bond trustee shall administer and account for the school facilities revenue bond proceeds fund.

§ 41-5754 School facilities revenue bond debt service fund

A. The board shall establish a school facilities revenue bond debt service fund consisting of monies transferred to the fund pursuant to sections 37-521 and 42-5030.01.

B. Monies in the school facilities revenue bond debt service fund may be used only for the purposes authorized by this article.

C. The state treasurer or bond trustee shall administer and account for the school facilities revenue bond debt service fund.

§ 41-5755 Securing principal and interest

A. In connection with issuing bonds authorized by this article and to secure the principal and interest on the bonds, the board by resolution may:

Segregate the school facilities revenue bond debt service fund into one or more accounts and subaccounts and provide that bonds issued under this article may be secured by a lien on all or part of the monies paid into the school facilities revenue bond debt service fund or into any account or subaccount in the fund.
Provide that the bonds issued under this article are secured by a first lien on the monies paid into the school facilities revenue bond debt service fund as provided by section 37-521, subsection B, paragraph 1 and section 42-5030.01, and pledge and assign to or in trust for the benefit of the holder or holders of the bonds all or part of the monies in the school facilities revenue bond debt service fund, any account or subaccount in the fund or in the school facilities revenue bond proceeds fund as is necessary to secure and pay the principal, the interest and any premium on the bonds as they come due.
Establish priorities among bondholders based on criteria adopted by the board.
Set aside, regulate and dispose of reserves and sinking accounts.
Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given.
Provide for payment of bond related expenses from the proceeds of the sale of the bonds or other revenues authorized by this article and available to the board.
Provide for the services of trustees, cotrustees, agents and consultants and other specialized services with respect to the bonds.
Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds.
Refund any bonds issued by the board, if these bonds are secured from the same source of revenues as the bonds authorized by this article, by issuing new bonds.
Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

B. Bonds issued to refund any bonds issued by the board as provided by subsection A, paragraphs 9 and 10 of this section are not subject to legislative authorization or the $200,000,000 limit prescribed by section 41-5751, subsection A.

§ 41-5756 Lien of pledge

A. Any pledge made under this article is valid and binding from the time when the pledge is made.

B. The monies so pledged and received by the board to be placed in the school facilities revenue bond debt service fund are immediately subject to the lien of the pledge without any future physical delivery or further act. Any lien of any pledge is valid and binding against all parties that have claims of any kind against the board, regardless of whether the parties have notice of the lien. The official resolution or trust indenture or any instrument by which this pledge is created, when adopted by the board, is notice to all concerned of the creation of the pledge, and those instruments need not be recorded in any other place to perfect the pledge.

§ 41-5757 Bond purchase; cancellation

The board may purchase bonds for cancellation out of any monies available for the purchase, at a price of not more than either of the following:

If the bonds are redeemable at the time of the purchase, the applicable redemption price plus accrued interest to the next interest payment date on the bonds.
If the bonds are not redeemable at the time of the purchase, the applicable redemption price on the first date after the purchase on which the bonds become subject to redemption plus accrued interest to that date.

§ 41-5758 Payment of revenue bonds

A. The revenue bonds shall be paid solely from monies from the school facilities revenue bond debt service fund established by section 41-5754 and other monies that are credited to the school facilities revenue bond debt service fund.

B. The state treasurer or the paying agent for the revenue bonds shall cancel all revenue bonds when paid.

§ 41-5759 Investment of monies in school facilities revenue bond proceeds fund

A. As provided by section 41-5761, the board may authorize the state treasurer or bond trustee to invest monies in the school facilities revenue bond proceeds fund established by section 41-5753.

B. The order directing an investment shall state a specified time when the proceeds from the sale of the bonds will be used. The state treasurer or bond trustee shall make the investment in such a way as to mature at the specified date.

C. All monies earned as interest or otherwise derived from the investment of the monies in the school facilities revenue bond proceeds fund shall be credited to the school facilities revenue bond debt service fund established by section 41-5754.

§ 41-5760 Investment of monies in school facilities revenue bond debt service fund

A. The board may authorize the state treasurer or bond trustee to invest and reinvest any monies in the school facilities revenue bond debt service fund as provided by section 41-5761.

B. All monies earned as interest or otherwise derived from the investment of the monies in the school facilities revenue bond debt service fund shall be credited to that fund.

§ 41-5761 Authorized investments of fund monies

A. On notice from the board, the state treasurer or bond trustee shall invest and divest monies in either the school facilities revenue bond proceeds fund or the school facilities revenue debt service fund in any of the following:

Obligations issued or guaranteed by the United States or any of the senior debt of its agencies, sponsored agencies, corporations, sponsored corporations or instrumentalities.
State, county or municipal bonds issued in this state on which the payments of interest have not been deferred.
Investment agreements and repurchase agreements collateralized by investments described in paragraph 1 of this subsection.

B. The purchase of the securities shall be made by the state treasurer or bond trustee on authority of a resolution of the board. The treasurer or bond trustee shall act as custodian of all securities purchased. The securities may be sold on an order of the board.

§ 41-5762 Characteristics of bonds; negotiable; exemption from taxation; obligation; legal investments

A. Bonds issued under this article are fully negotiable within the meaning and for all purposes of the uniform commercial code, subject only to any provisions for registration, regardless of whether the bonds actually constitute negotiable instruments under the uniform commercial code.

B. The bonds, their transfer and the income from the bonds are at all times free from taxation in this state.

C. Bonds issued under this article:

Are obligations of the board. The members of the board and persons executing the bonds are not personally liable for payment of the bonds.
Are payable only according to their terms.
Are not general, special or other obligations of this state.
Do not constitute a debt of this state.
Are not enforceable against this state nor is payment of the bonds enforceable out of any monies other than the revenue pledged and assigned to, or in trust for the benefit of, the holder or holders of the bonds.
Are securities in which public officers and bodies of this state and of municipalities and political subdivisions of this state, all companies, associations and other persons carrying on an insurance business, all financial institutions, investment companies and other persons carrying on a banking business, all fiduciaries and all other persons who are authorized to invest in government obligations may properly and legally invest.
Are securities that may be deposited with public officers or bodies of this state and municipalities and political subdivisions of this state for purposes that require the deposit of government bonds or obligations.

§ 41-5763 Effect of changing circumstances on bonds; agreement of state

A. Bonds issued under this article remain valid and binding obligations of the board notwithstanding that, before the delivery of the bonds, any of the persons whose signatures appear on the bonds cease to be members of the board.

B. An amendment of any provision of this article does not diminish or impair the validity of bonds issued under this article or the remedies and rights of bondholders.

C. This state pledges to and agrees with the holders of the bonds authorized by this article that this state will not limit, alter or impair the rights and remedies of the bondholders, until all bonds issued under this article, together with interest on the bonds, interest on any unpaid installments of principal or interest and all costs and expenses in connection with any action or proceedings by or on behalf of the bondholders, are fully met and discharged. The board, as agent for this state, may include this pledge and undertaking in its resolutions and indentures authorizing and securing the bonds.

§ 41-5764 Validity of bonds; certification by attorney general

A. This article constitutes full authority for authorizing and issuing bonds without reference to any other law of this state. No other law with regard to authorizing or issuing obligations or that in any way impedes or restricts performing the acts authorized by this article may be construed to apply to any proceedings taken or acts done pursuant to this article.

B. The validity of bonds issued under this article does not depend on and is not affected by the legality of any proceeding relating to any action by the board in granting or lending monies or the acquisition, construction or improvement of any facility paid with monies provided by the board.

C. The board may submit to the attorney general revenue bonds to be issued under this article after all proceedings for authorizing the bonds have been completed. Within fifteen days after submission, the attorney general shall examine the bonds and pass on the validity of the bonds and the regularity of the proceedings. If the bonds and proceedings comply with the Constitution of Arizona and this article, and if the bonds when delivered and paid for will constitute binding and legal obligations of the board, the attorney general shall certify in substance that the bonds are issued according to the constitution and laws of this state. The certificate shall also state that the bonds are also validly secured by the obligation to transfer monies from designated sources of revenue, including income on the permanent state school fund established by section 37-521, to cover any insufficiencies.

D. The bonds shall recite that they are regularly issued pursuant to this article. That recital, together with the certification by the attorney general under subsection C of this section, constitutes prima facie evidence of the legality and validity of the bonds. From and after the sale and delivery of the bonds, they are incontestable by the board or this state.

Article 7 State School Improvement Revenue Bonds

§ 41-5781 Authorization of state school improvement revenue bonds; expiration

A. The board may issue revenue bonds in a principal amount not to exceed $800,000,000 pursuant to this article. The board may also issue qualified zone academy bonds within the meaning of section 1397e of the United States internal revenue code of 1986 or successor provisions pursuant to this article in a principal amount not to exceed $20,000,000. The qualified zone academy bonds shall be separately accounted for within the school improvement revenue bond proceeds fund established by section 41-5783. All bonds authorized by this section may be issued for the following purposes:

To provide monies to pay the cost of bond-related expenses, including any expenses incurred by the board to issue and administer its bonds, including underwriting fees and costs, trustee fees, financial consultant fees, printing and advertising costs, paying agent fees, transfer agent fees, legal, accounting, feasibility consultant and other professional fees and expenses, bond insurance or other credit enhancements or liquidity facilities, attorney and accounting fees and expenses related to credit enhancement, bond insurance or liquidity enhancement, remarketing fees, rating agency fees and costs, travel and telephone expenses and all other fees considered necessary by the board in order to market and administer the bonds.
To fully or partially fund any reserves or sinking accounts established by the bond resolution.

B. The board shall authorize the bonds by resolution. The resolution shall prescribe:

The fixed or variable rate or rates of interest, the date or dates on which interest is payable and the denominations of the bonds.
The date or dates of the bonds and maturity, within twenty years after the date of issuance.
The form of the bonds.
The manner of executing the bonds.
The medium and place of payment.
The terms of redemption, which may provide for a premium for early redemption.

C. The bonds issued pursuant to this article shall be known as state school improvement revenue bonds.

D. The authority of the board to issue school improvement revenue bonds pursuant to this article expires from and after June 30, 2003, except for bonds issued to refund any bonds issued by the board.

§ 41-5782 Issuance and sale of school improvement revenue bonds

A. The board shall issue the school improvement revenue bonds in the number and amount provided in the resolution.

B. The bonds shall be sold at public or private sale at the price and on the terms prescribed in the resolution at, above or below par.

C. The net proceeds of the sale of the bonds shall be deposited in the school improvement revenue bond proceeds fund established pursuant to section 41-5783.

§ 41-5783 School improvement revenue bond proceeds fund; use for school improvements

A. If the board issues revenue bonds under this article, the board shall establish a school improvement revenue bond proceeds fund consisting of the net proceeds received from the sale of the bonds.

B. The board may use monies in the school improvement revenue bond proceeds fund only for the purposes provided in section 41-5781, subsection A. Monies in the school improvement revenue bond proceeds fund are exempt from lapsing under section 35-190.

C. The state treasurer or bond trustee shall administer and account for the school improvement revenue bond proceeds fund.

§ 41-5784 School improvement revenue bond debt service fund

A. The board shall establish a school improvement revenue bond debt service fund consisting of monies received by the board pursuant to section 42-5029, subsection E and section 37-521, subsection B, paragraph 1. All monies received pursuant to section 42-5029, subsection E shall be accounted for separately and shall be used only for debt service of school improvement revenue bonds. All monies received pursuant to section 37-521, subsection B, paragraph 1 shall be accounted for separately and shall be used only for debt service of qualified zone academy bonds.

B. Monies in the school improvement revenue bond debt service fund may be used only for the purposes authorized by this article.

C. The state treasurer or bond trustee shall administer and account for the school improvement revenue bond debt service fund.

§ 41-5785 Securing principal and interest

A. In connection with issuing bonds authorized by this article and to secure the principal and interest on the bonds, the board by resolution may:

Segregate the school improvement revenue bond debt service fund into one or more accounts and subaccounts and provide that bonds issued under this article may be secured by a lien on all or part of the monies paid into the revenue bond debt service fund or into any account or subaccount in the fund.
Provide that the bonds issued under this article be secured by a first lien on the monies paid into the school improvement revenue bond debt service fund as provided by section 42-5029, subsection E, paragraph 1 and pledge and assign to or in trust for the benefit of the holder or holders of the bonds all or part of the monies in the school improvement revenue bond debt service fund, in any account or subaccount in the fund or in the school improvement revenue bond proceeds fund as is necessary to secure and pay the principal, the interest and any premium on the bonds as they come due.
Establish priorities among bondholders based on criteria adopted by the board.
Set aside, regulate and dispose of reserves and sinking accounts.
Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given.
Provide for paying bond-related expenses from the proceeds of the sale of the bonds or other revenues authorized by this article and available to the board.
Provide for the services of trustees, cotrustees, agents and consultants and other specialized services with respect to the bonds.
Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds.
Refund any bonds issued by the board, if these bonds are secured from the same source of revenues as the bonds authorized by this article, by issuing new bonds, whether at or before maturity of the bonds being refunded.
Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

B. Bonds that are issued to refund any bonds that are issued by the board as provided by subsection A, paragraphs 9 and 10 of this section are not subject to legislative authorization or subject to the $800,000,000 limit prescribed by section 41-5781, subsection A.

§ 41-5786 Lien of pledge

A. Any pledge made under this article is valid and binding from the time when the pledge is made.

B. The monies so pledged and received by the board to be placed in the school improvement revenue bond debt service fund are immediately subject to the lien of the pledge without any future physical delivery or further act. Any lien of any pledge is valid and binding against all parties that have claims of any kind against the board, regardless of whether the parties have notice of the lien. The official resolution or trust indenture or any instrument by which this pledge is created, when adopted by the board, is notice to all concerned of the creation of the pledge, and those instruments need not be recorded in any other place to perfect the pledge.

§ 41-5787 Bond purchase; cancellation

The board may purchase bonds for cancellation out of any monies available for the purchase at a price of not more than either of the following:

If the bonds are redeemable at the time of the purchase, the applicable redemption price plus accrued interest to the next interest payment date on the bonds.
If the bonds are not redeemable at the time of the purchase, the applicable redemption price on the first date after the purchase on which the bonds become subject to redemption plus accrued interest to that date.

§ 41-5788 Payment of revenue bonds

A. The revenue bonds shall be paid solely from monies from the school improvement revenue bond debt service fund established pursuant to section 41-5784 and other monies that are credited to the school improvement revenue bond debt service fund.

B. The state treasurer or the paying agent for the revenue bonds shall cancel all revenue bonds when paid.

§ 41-5789 Investment of monies in school improvement revenue bond proceeds fund

A. As provided by section 41-5791, the board may authorize the state treasurer or bond trustee to invest monies in the school improvement revenue bond proceeds fund established pursuant to section 41-5783.

C. All monies earned as interest or otherwise derived from the investment of the monies in the school improvement revenue bond proceeds fund shall be credited to the school improvement revenue bond debt service fund established by section 41-5784.

§ 41-5790 Investment of monies in school improvement revenue bond debt service fund

A. The board may authorize the state treasurer or bond trustee to invest and reinvest any monies in the school improvement revenue bond debt service fund as provided by section 41-5791.

B. All monies earned as interest or otherwise derived from the investment of the monies in the school improvement revenue bond debt service fund shall be credited to that fund.

§ 41-5791 Authorized investments of fund monies

A. On notice from the board, the state treasurer or bond trustee shall invest and divest monies in either the school improvement revenue bond proceeds fund or the school improvement revenue bond debt service fund in any of the following:

Obligations issued or guaranteed by the United States or any of the senior debt of its agencies, sponsored agencies, corporations, sponsored corporations or instrumentalities.
State, county or municipal bonds that are issued in this state and on which the payments of interest have not been deferred.
Investment agreements and repurchase agreements collateralized by investments described in paragraph 1 of this subsection.

§ 41-5792 Characteristics of bonds; negotiable; exemption from taxation; obligation; legal investments

B. The bonds, their transfer and the income from the bonds are at all times free from taxation in this state.

C. Bonds issued under this article:

Are obligations of the board. The members of the board and persons executing the bonds are not personally liable for payment of the bonds.
Are payable only according to their terms.
Do not constitute a debt of this state.
Are not enforceable against this state nor is payment of the bonds enforceable out of any monies other than the revenue pledged and assigned to, or in trust for the benefit of, the holder or holders of the bonds.
Are securities in which public officers and bodies of this state and of municipalities and political subdivisions of this state, all companies, associations and other persons carrying on an insurance business, all financial institutions, investment companies and other persons carrying on a banking business, all fiduciaries and all other persons who are authorized to invest in government obligations may properly and legally invest.
Are securities that may be deposited with public officers or bodies of this state and municipalities and political subdivisions of this state for purposes that require the deposit of government bonds or obligations.

§ 41-5793 Effect of changing circumstances on bonds; agreement of state

A. Bonds issued under this article remain valid and binding obligations of the board notwithstanding that before the delivery of the bonds any of the persons whose signatures appear on the bonds cease to be members of the board.

B. An amendment of any provision of this article does not diminish or impair the validity of bonds issued under this article or the remedies and rights of bondholders.

C. This state pledges to and agrees with the holders of the bonds authorized by this article that this state will not limit, alter or impair the rights and remedies of the bondholders until all bonds issued under this article, together with interest on the bonds, interest on any unpaid installments of principal or interest and all costs and expenses in connection with any action or proceedings by or on behalf of the bondholders, are fully met and discharged. The board, as agent for this state, may include this pledge and undertaking in its resolutions and indentures authorizing and securing the bonds.

§ 41-5794 Validity of bonds; certification by attorney general

Article 8 Impact Aid Revenue Bonds

§ 41-5801 Definition

For the purposes of this article, "impact and revenues" means the revenues received by the school district pursuant to 20 United States Code sections 7701 through 7714.

§ 41-5802 Authorization of school district impact aid revenue bonds

A. On voter approval pursuant to section 15-491, a school district governing board may issue negotiable impact aid revenue bonds pursuant to this article. Bonds may be issued under this article in a total aggregate amount not to exceed three times the average of the school district’s annual impact aid revenues for the five years immediately preceding the issuance of the bonds. The bond proceeds may be used to:

Provide monies to pay the cost of:

(a) Capital projects authorized under chapter 4, article 5 of this title.

(b) Bond related expenses including any expenses incurred by the school district to issue and administer its bonds including underwriting fees and costs, trustee fees, financial consultant fees, printing and advertising costs, paying agent fees, transfer agent fees, legal, accounting, feasibility consultant and other professional fees and expenses, bond insurance or other credit enhancements or liquidity facilities, attorney and accounting fees and expenses related to credit enhancement, bond insurance or liquidity enhancement, remarketing fees, rating agency fees and costs, travel and telephone expenses and all other fees considered necessary by the governing board in order to market and administer the bonds.

Fully or partially fund any reserves or sinking accounts established by the bond resolution.

B. The governing board shall authorize the bonds by resolution. The resolution shall prescribe:

The fixed or variable rate or rates of interest, payable semiannually, and the denominations of the bonds.
The date or dates of the bonds and maturity, within twenty years after the date of issuance.
The form of the bonds.
The manner of executing the bonds.
The medium and place of payment.
The terms of redemption, which may provide for a premium for early redemption.

C. The bonds issued pursuant to this article shall be known as impact aid revenue bonds.

D. An accommodation school may issue impact aid revenue bonds only if the accommodation school is located on a military base.

§ 41-5803 Issuance and sale of impact aid revenue bonds

A. The governing board shall issue the bonds in the number and amount provided in the resolution.

B. The bonds shall be sold at public or private sale at the price and on the terms prescribed in the resolution for at, above or below par.

C. The proceeds of the sale of the bonds shall be deposited in the county treasury to the credit of the school district's impact aid revenue bond building fund. These deposits may be drawn out for the purposes authorized by this article as other school monies are drawn.

D. Revenue bond proceeds shall not be expended for items whose useful life is less than the average life of the bonds issued, except that bond proceeds shall not be expended for items whose useful life is less than five years.

§ 41-5804 Impact aid revenue bond building and debt service funds

A. If a school district issues impact aid revenue bonds under this article, the governing board shall establish:

An impact aid revenue bond building fund consisting of the net proceeds received from the sale of the bonds. The fund shall be a continuing fund that is not subject to reversion.
An impact aid revenue bond debt service fund consisting of monies received by the school district from impact aid revenues.

B. Monies in the impact aid revenue bond building fund and the impact aid revenue bond debt service fund may be used only for the purposes authorized by this article.

C. The school district shall provide the county treasurer with an impact aid revenue bond debt service schedule. The county treasurer shall keep an account of all school district debt service funds that shows the school district to which each fund belongs. The county treasurer shall credit to the impact aid revenue bond debt service fund an amount from impact aid revenues equal to the principal and interest that will become due on the impact aid revenue bonds during the current year. The treasurer shall receive and credit any interest or income earned by the debt service fund.

D. Notwithstanding any other provision in this article, the annual payment of principal and interest on impact aid revenue bonds each year shall not exceed seventy-five per cent of the net impact aid revenues of the school district for the current year. For the purposes of this subsection, "net impact aid revenues" mean impact aid revenues for the year after deducting the sum of the following amounts:

The amount of any increase in the school district's general budget limit pursuant to section 15-905, subsections K, O and P.
The amount necessary to fund any budget override adopted pursuant to section 15-481, subsection F, J or M.
The amount that would be produced by levying the applicable qualifying tax rate as provided in section 15-971, subsection B, minus the amount levied for primary school district taxes for the year pursuant to section 15-992, except that if the result is a negative number, use zero.

§ 41-5805 Securing principal and interest

To secure the principal and interest on the impact aid revenue bonds, the school district governing board by resolution may:

Segregate the impact aid revenue bond debt service fund into one or more accounts and subaccounts and provide that bonds issued under this article may be secured by a lien on all or part of the monies paid into the impact aid revenue bond debt service fund or into any account or subaccount in the fund.
Provide that the bonds issued under this article be secured by a first lien on the monies paid in the impact aid revenue bond debt service fund as provided by section 41-5804 and pledge and assign to or in trust for the benefit of the holder or holders of the bonds all or part of the monies in the impact aid revenue bond debt service fund or an account or subaccount as is necessary to secure and pay the principal, the interest and any premium on the bonds as they come due.
Establish priorities among bondholders based on criteria adopted by the governing board.
Set aside, regulate and dispose of reserves and sinking accounts.
Prescribe the procedure, if any, by which the terms of any contract with bondholders may be amended or abrogated, the amount of bonds the holders of which must consent to and the manner in which the consent may be given.
Provide for payment of bond related expenses from the proceeds of the sale of the bonds or other revenues authorized by this article available to the school district.
Provide for the services of trustees, cotrustees, agents and consultants and other specialized services with respect to the bonds.
Take any other action that in any way may affect the security and protection of the bonds or interest on the bonds.
Refund any bonds issued by the school district, if these bonds are secured from the same source of revenues as the bonds authorized by this article, by issuing new bonds.
Issue bonds partly to refund outstanding bonds and partly for any other purpose consistent with this article.

§ 41-5806 Cancellation of unsold impact aid revenue bonds

A. If an impact aid revenue bond issue remains unsold for six months after being offered for sale, the governing board of the school district or any school district comprised wholly or partly of territory that was part of the school district at the time of issuing the bonds may cancel the unsold bonds.

B. The governing board shall fix a time for a hearing on the proposed cancellation of the unsold bonds. The governing board shall give notice of the time, place and subject of the hearing. The notice shall be published for ten days before the hearing in a newspaper of general circulation in the district.

C. At the time and place designated in the notice, the governing board shall hear reasons for or against the proposed cancellation of the unsold bonds, and if the board considers it to be in the school district's best interests, it shall order the unsold bonds to be cancelled and the bonds and the vote by which they were authorized to be issued are void.

§ 41-5807 Payment of impact aid revenue bonds; use of surplus monies

A. The impact aid revenue bonds shall be paid solely from monies distributed to the school district from impact aid revenues and other monies that are authorized by this article and that are credited to the school district's impact aid revenue bond debt service fund.

B. The county treasurer or the paying agent for the impact aid revenue bonds shall cancel all impact aid revenue bonds when paid. Any surplus monies remaining in the impact aid revenue bond debt service fund shall be transferred back to the school district's capital outlay fund.

C. If a balance remains in the school district's impact aid revenue bond building fund after the acquisition or construction of facilities for which the bonds were issued is completed and the payment of other related costs, the balance remaining in the impact aid revenue bond building fund shall be transferred to the school district's capital outlay fund.

§ 41-5808 Investment of monies in impact aid revenue bond building fund

A. If monies in the impact aid revenue bond building fund are not required to be used for a period of ten days or more, the governing board may authorize their investment.

B. The order directing an investment shall state a specified time when the proceeds from the sale of the bonds will be used. The governing board shall make the investment in such a way as to mature at the specified date.

C. All monies earned as interest or otherwise derived from the investment of the monies in the impact aid revenue bond building fund shall be credited to the impact aid revenue bond debt service fund.

§ 41-5809 Investment of monies in impact aid revenue bond debt service fund

A. The governing board may authorize the investment and reinvestment of any monies in the school district's impact aid revenue bond debt service fund.

B. All monies earned as interest or otherwise derived from the investment of the monies in the impact aid revenue bond debt service fund shall be credited to that fund.

C. The impact aid revenue bond debt service fund is a continuing fund and is not subject to reversion.

§ 41-5810 Authorized investments of fund monies

A. The monies in either the impact aid revenue bond building fund or debt service fund may be invested and reinvested at the direction of the school district governing board in any of the investments authorized by section 41-5761.

B. The purchase of the securities shall be made by the county treasurer or the treasurer's designated agent on authority of a resolution of the governing board. The county treasurer shall act as custodian of all securities purchased. The securities may be sold on an order of the governing board.

§ 41-5811 Audit

A. The governing board shall cause an annual audit to be made of the impact aid revenue bond building fund and the impact aid revenue bond debt service fund, including all accounts and subaccounts in the funds. A certified public accountant shall conduct the audit within ninety days after the end of the fiscal year.

B. The governing board shall immediately file a certified copy of the audit with the auditor general. The auditor general may make any further audits and examinations that are considered to be necessary and take appropriate action relating to the audit or examination pursuant to title 41, chapter 7, article 10.1. If the auditor general takes no official action within thirty days after the audit is filed, the audit is considered to be sufficient.

C. The governing board shall pay negotiated and approved fees and costs of the certified public accountant and auditor general under this section from the impact aid revenue bond debt service fund.

§ 41-5812 Lien of pledge

A. Any pledge made under this article is valid and binding from the time when the pledge is made.

B. The monies so pledged and received by the school district to be placed in the impact aid revenue bond debt service fund are immediately subject to the lien of the pledge without any future physical delivery or further act. Any lien of any pledge is valid and binding against all parties that have claims of any kind against the school district, regardless of whether the parties have notice of the lien. The official resolution or trust indenture or any instrument by which this pledge is created, when adopted by the governing board, is notice to all concerned of the creation of the pledge, and those instruments need not be recorded in any other place to perfect the pledge.

§ 41-5813 Characteristics of bonds; negotiable; exemption from taxation; obligation; legal investments

B. The bonds, their transfer and the income from the bonds are at all times free from taxation in this state.

C. Bonds issued under this article:

Are obligations of the school district. The members of the governing board and persons executing the bonds are not personally liable for payment of the bonds.
Are payable only according to their terms.
Are not general, special or other obligations of the county or of this state.
Do not constitute a debt of the county or of this state.
Are not enforceable against the county or this state nor is payment of the bonds enforceable out of any monies other than the revenue pledged and assigned to, or in trust for the benefit of, the holder or holders of the bonds.
Are securities in which public officers and bodies of this state and of municipalities and political subdivisions of this state, all companies, associations and other persons carrying on an insurance business, all financial institutions, investment companies and other persons carrying on a banking business, all fiduciaries and all other persons who are authorized to invest in government obligations may properly and legally invest.
Are securities that may be deposited with public officers or bodies of this state and municipalities and political subdivisions of this state for purposes that require the deposit of government bonds or obligations.

§ 41-5814 Effect of changing circumstances on bonds; agreement of state

A. Bonds issued under this article remain valid and binding obligations of the school district notwithstanding that before the delivery of the bonds any of the persons whose signatures appear on the bonds cease to be officers of the school district.

B. An amendment of any provision of this article does not diminish or impair the validity of bonds issued under this article or the remedies and rights of bondholders.

C. This state pledges to and agrees with the holders of the bonds authorized by this article that this state will not limit, alter or impair the ability of a school district to qualify for impact aid revenues, or in any way impair the rights and remedies of the bondholders, until all bonds issued under this article, together with interest on the bonds, interest on any unpaid installments of principal or interest and all costs and expenses in connection with any action or proceedings by or on behalf of the bondholders, are fully met and discharged. The governing board, as agent for this state, may include this pledge and undertaking in its resolutions and indentures authorizing and securing the bonds.

§ 41-5815 Validity of bonds; certification by attorney general

B. The validity of bonds issued under this article is not dependent on or affected by the legality of any proceeding relating to the acquisition, construction or improvement of any school district capital project for which the bonds are issued.

C. The governing board may submit to the attorney general revenue bonds to be issued under this article after all proceedings for authorizing the bonds have been completed. Within fifteen days after submission, the attorney general shall examine the bonds and pass on the validity of the bonds and the regularity of the proceedings. If the bonds and proceedings comply with the Arizona Constitution and this article, and if the bonds when delivered and paid for will constitute binding and legal obligations of the school district, the attorney general shall certify in substance that the bonds are issued according to the constitution and laws of this state. The certificate shall also state that the bonds are also validly secured by the obligation to transfer impact aid revenues to cover any insufficiencies.

D. The bonds shall recite that they are regularly issued pursuant to this article. From and after the sale and delivery of the bonds, they are incontestable by this state or the school district.

Article 9 Indoor Air Quality in Schools

§ 41-5831 Definitions

In this article, unless the context otherwise requires:

"HVAC system" means the equipment, distribution network and terminals that provide, either collectively or individually, the process of heating, ventilation or air conditioning to a building.
"School activity hours" means the time of day in which students or school personnel occupy school facilities.
"Standard 62" means the American national standards institute/American society of heating, refrigerating and air conditioning engineers standard 62.1 entitled "ventilation for acceptable indoor air quality".

§ 41-5832 Indoor air quality requirements

A. When the board or the division approves the construction of a school building, the division shall conduct an environmental site assessment. The division shall consider site assessment standards in accordance with the American society for testing and materials standard E1527, standard practice for environmental site assessments: phase I environmental site assessment process.

B. The board or the division shall not approve a school building project if any of the following conditions exists:

The environmental site assessment indicates that the site cannot meet, within reasonable expenditures, the same criteria established for residential properties.
The plans incorporate flat roof construction that does not have adequate pitch towards drains in order to prevent pooling of water.
The plans do not incorporate indoor air quality guidelines that are acceptable to the division. The division shall consider indoor air quality guidelines in accordance with the sheet metal and air conditioning contractors national association's publication entitled "indoor air quality guidelines for occupied buildings under construction".

C. Each school district governing board that installed or renovated its HVAC system on or after August 12, 2005 shall ensure that its HVAC system meets both of the following requirements:

Is maintained and operated in a manner consistent with ventilation standards acceptable to the division. The division shall consider ventilation standards in accordance with standard 62.
Is operated continuously during school activity hours except during scheduled maintenance and emergency repairs and except during periods for which school officials can demonstrate to the governing board's satisfaction that the quantity of outdoor air supplied by an air supply system that is not mechanically driven meets the requirements for air changes per hour acceptable to the board.

D. Each school district governing board that installed or renovated its HVAC system before August 12, 2005 shall ensure that its HVAC system is maintained and operated in accordance with the prevailing maintenance and standards at the time of the installation or renovation of the HVAC system.

Article 10 Achievement District Schools

§ 41-5841 Achievement district school application

A. The credit enhancement eligibility board established by section 41-5852 shall establish an application process, application forms and selection criteria for a public school or charter school to qualify as an achievement district school for the purposes of article 11 of this chapter.

B. A public school or charter school that meets all of the following criteria is eligible to qualify as an achievement district school:

Has been assigned a letter grade of A, or an equivalent successor classification, pursuant to section 15-241.
Has proven instructional strategies and curricula that demonstrate high academic outcomes.
Has a verifiable enrollment demand, including the placement of prospective pupils on a waiting list.
Has a sound financial plan that contemplates operational costs and future enrollment growth.
Has shown a commitment to provide technical assistance, including business services, curriculum development and teacher training, to an underperforming school in the state.
Meets any other criteria established by the credit enhancement eligibility board.

C. The credit enhancement eligibility board shall meet regularly to evaluate achievement district school applications and shall either approve or deny each application submitted. The board shall report its decision on each application to the public school or charter school within ten business days after the board's decision.

D. If a school's application is approved pursuant to this section, the school qualifies as an achievement district school and is eligible to apply for participation in the Arizona public school credit enhancement program established by section 41-5855.

Article 11 Arizona Public School Credit Enhancement Program

§ 41-5851 Definitions

In this article, unless the context otherwise requires:

"Achievement district school" means a public school or a charter school that has qualified as an achievement district school pursuant to article 10 of this chapter and that has submitted an application with the board pursuant to this article to obtain guaranteed financing.
"Board" means the credit enhancement eligibility board established by section 41-5852.
"Fund" means the Arizona public school credit enhancement fund established by section 41-5854.
"Guaranteed financing" means debt obligations that are issued by or on behalf of a public school or a charter school to acquire, construct, renovate, equip, refinance or improve capital facilities and for which the board has approved a guarantee of all or a portion of the principal and interest payments pursuant to the program.
"Program" means the Arizona public school credit enhancement program established by section 41-5855.
"Program funding obligations" means program funding obligations approved and issued by the board pursuant to section 41-5857.
"Program leverage ratio" means the ratio at any time between the aggregate principal amount of guaranteed financings outstanding and the amounts on deposit in the fund.

§ 41-5852 Credit enhancement eligibility board; members

A. The credit enhancement eligibility board is established consisting of the following members:

The governor or the governor's designee.
The state treasurer or the treasurer's designee.
The director of the department of administration or the director's designee.

B. Members of the board are not eligible to receive compensation for services performed pursuant to this article.

C. Members of the board are public officers with respect to their service on the board and are subject to title 38, chapter 3, article 8, and the board is a public body for the purposes of title 38, chapter 3, article 3.1.

§ 41-5853 Powers and duties of the board

A. The board is a body corporate and politic and may have an official seal that is judicially noticed.

B. The board may:

Sue and be sued in its own name.
Contract and enter into agreements as necessary to carry out its responsibilities under this article.
Contract with experts, advisers, consultants and agents, including financial experts, legal counsel and other advisers and consultants as may be necessary for services to assist the board.
Make and execute contracts and other instruments necessary or convenient for the performance of its duties and the exercise of its power and functions.
Pursuant to section 41-5855, approve financing for an achievement district school as guaranteed financing under the program.
Do all acts, whether or not expressly authorized, that may be deemed necessary or proper for the protection of the monies in the Arizona public school credit enhancement fund, except that the board may not take any action that would create a general or moral obligation of this state or any agency of the state.
Contract with any entity relating to guaranteed financings.
Issue program funding obligations pursuant to section 41-5857.
Adopt rules governing the operation of the program.
Take any other action that is necessary or appropriate to carry out this article.

C. The division shall provide staff as requested by the board to support the activities of the board.

§ 41-5854 Arizona public school credit enhancement fund; purposes; exemption

A. The Arizona public school credit enhancement fund is established consisting of:

Payments of program participation fees paid by schools that have participated in guaranteed financings pursuant to section 41-5855.
Repayments of monies of the fund that are used to make payments of principal and interest on guaranteed financings pursuant to section 41-5856.
The proceeds of program funding obligations issued by the board pursuant to section 41-5857.
Gifts, grants and donations received from any public or private source to carry out the purposes of this article.
Interest earnings and investment income earned on monies in the fund.
Any other monies distributed, paid or deposited to the fund by law or pursuant to contracts arising out of a guaranteed financing.

B. Monies and other assets of the fund shall be held and disbursed separate and apart from all other monies or assets of this state or political subdivisions of this state.

C. Monies in the fund shall be used for the following purposes:

By the state treasurer to make payments of principal or interest on guaranteed financings pursuant to section 41-5856.
By the board at its direction:

(a) To pay any operational or administrative expenses of the board, including fees for advisers, rating agencies and professionals retained by the board.

(b) To make payments to bond insurers to provide municipal bond insurance guaranteeing the timely payment of all or a portion of any guaranteed financing.

D. The state treasurer shall administer the fund and shall disburse monies in the fund as required by subsection C, paragraph 1 of this section and as directed by the board pursuant to subsection C, paragraph 2 of this section. The state treasurer shall separately account for monies received from each source listed in subsection A of this section and may establish accounts and subaccounts as necessary to properly account for and use monies in the fund.

E. Monies received pursuant to subsection A of this section may not be used for any purpose except guaranteeing or making payments of principal and interest on guaranteed financings approved by the board and any costs and expenses of the program or the board as provided in this article.

F. The state treasurer shall invest and divest monies in the fund as provided in section 35-313, and monies earned from investment shall be credited to the fund. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

§ 41-5855 Arizona public school credit enhancement program; eligibility; approval of financing; participation fee

A. The Arizona public school credit enhancement program is established to assist achievement district schools in obtaining more favorable financing by guaranteeing the payment of principal and interest on guaranteed financings issued by or on behalf of achievement district schools.

B. To be considered for a guaranteed financing, an achievement district school shall submit an application to the board, on a form and in the manner prescribed by the board, that contains at least the following information:

Proof of approval of the school's application pursuant to article 10 of this chapter at the time of applying to the board. A school's failure to maintain ongoing achievement district school eligibility does not impair or affect the validity or enforceability of the program guarantee.
Exhibited sustainability in the financial operations of the school over at least two years based on financial metrics determined by the board, including days cash on hand, the ratio of operating revenues to debt service or the ratio of the financed property value to any debt being secured by the property.
For charter schools, demonstrated experience in operating and managing charter schools with high academic outcomes for at least two consecutive years.
Information regarding the proposed guaranteed financing by or on behalf of the school, including the planned timing of the financing, sources and uses of monies, the expected principal and interest payment dates and amounts by payment date, plans for funding reserves, expected ratings, if any, and any other information that would be useful to the board's deliberations.
For charter schools, an acknowledgement that the guaranteed financing will include a fully funded debt service reserve equal to at least the maximum amount permitted by federal law in connection with the issuance of tax exempt obligations.
The identification of any property being pledged as collateral to the guaranteed financing and the value of the property.
Any additional information that the board determines to be reasonable or necessary in order to fully evaluate the application.

C. The board shall meet regularly to evaluate applications and shall either approve or reject each application submitted. In considering the approval of any application, the board shall ensure, if the application is approved:

That the program leverage ratio will not exceed a ratio of three and one-half to one as a result of the approval of the guaranteed financing being considered.
That, after ten guaranteed financings have been approved by the board, not more than twenty-five percent of the aggregate principal amount of guaranteed financings will be rated less than "BB-" or a comparable rating by a nationally recognized bond rating agency.

D. The board shall report each decision on each application to the achievement district school within ten business days after the board's decision.

E. If approved by the board for guaranteed financing, each charter school shall pay an annual program participation fee in the amount of at least 0.25 percent of the outstanding principal amount of the guaranteed financing in any year as determined by the board for as long as the guaranteed financing is outstanding. Program participation fees for district public schools shall be as determined by the board. Program participation fees due in any year shall be paid in equal amounts on the date that interest is due and payable to investors under the guaranteed financing or at such other time as may be required by the board. Program participation fees shall be paid to the state treasurer on behalf of the program for deposit in the fund.

F. The terms and conditions of the board in approving a guaranteed financing may be set forth in a written agreement between the board and the achievement district school.

§ 41-5856 Payment of program guarantees; notification requirements; repayment

A. On any draw from the debt service reserve fund to pay principal or interest on a guaranteed financing, the bank trustee, paying agent or other fiduciary for the guaranteed financing shall deliver written notice of the draw to the board and to the state treasurer within ten business days after the draw.

B. If a school does not expect to make timely payment of principal or interest on its guaranteed financing, and after any monies in any debt service reserve fund securing the guaranteed financing are fully expended, the bank trustee, paying agent or other fiduciary responsible for paying the principal and interest to investors on the guaranteed financing, at least five business days before a debt service payment date on the guaranteed financing, shall notify the board and the state treasurer in writing of the expected deficiency. Within two business days after receipt of the notice, the state treasurer shall pay from the fund to the bank trustee, paying agent or other fiduciary the amount to be used solely for making payment of principal or interest on the guaranteed financing.

C. If the state treasurer makes a payment in connection with a guaranteed financing from the fund pursuant to subsection B of this section, the school on whose behalf the payment was made shall repay the amount of the payment plus interest at a rate that is one hundred basis points higher than the true interest rate on the guaranteed financing as determined by the board. Repayment shall be made in equal monthly installments over a twelve-month period or another period as determined by the board. The repayments shall be made to the state treasurer for deposit in the fund. After the stated repayment period, any outstanding repayment balance shall become immediately due and payable. Any repayment amount owed to the fund that is not otherwise paid remains a lawful obligation of the school and shall be paid from any other monies lawfully available to the school.

D. In exchange for the guarantee of the payment of amounts due on guaranteed financing issued by or on behalf of an achievement district school, the board and the fund are entitled to protections and remedies relating to the repayment of the amount, if any, paid from the fund with respect to the guaranteed financing, and the payment of program participation fees. The protections and remedies may include one or more of the following:

The right to all or a portion of the proceeds from the sale or lease of any property serving as collateral for a guaranteed financing.
The right to intercept any payments or monies otherwise payable to the school.
The right to any insurance proceeds otherwise payable to the school.

E. On request of the board, the attorney general shall take any actions necessary to enforce repayment of fund monies by a school.

§ 41-5857 Program funding obligations; immunity

A. The board may deliver nonnegotiable program funding obligations in one or more series in an aggregate principal amount of not more than $80,000,000.

B. The board shall sell any program funding obligations prescribed in subsection A of this section to the state treasurer, and the state treasurer shall buy such obligations as an allowable investment of the fund. The total principal amount of program funding obligations outstanding at any one time may not exceed $80,000,000. The board may reissue to the state treasurer any called program funding obligations on the same terms as the obligations that were called and in a principal amount that does not exceed the principal amount called.

C. The board shall authorize each program funding obligation by a resolution that sets forth:

The rate or rates of interest.
The date or dates of maturity.
The terms of redemption.
The form and manner of execution of the program funding obligation.
Any terms necessary to secure credit enhancement or other sources of payment or security.
Any other terms deemed necessary or advisable by the board.

D. The interest rate to be paid on program funding obligations authorized by the board pursuant to subsection C of this section shall be equal to the sum of the following:

The actual rate of interest earned by the state treasurer on the investment of the proceeds from the sale of the program funding obligations.
For any period during which guaranteed financings are outstanding, an additional interest rate of at least one hundred basis points as determined by the board.

E. The principal of and interest on the program funding obligations shall be secured by and paid from monies deposited in the fund, on the terms set forth in the resolution, and are subordinate to any payments that are necessary to be made for guaranteed financings. Principal payments shall be paid on a basis proportional to the reduction in outstanding principal of guaranteed financings under the program. Interest shall be paid on an annual or more frequent basis as set forth in the resolution of the board. The monies pledged under this section to the program funding obligations are immediately subject to the lien of the pledge without any future physical delivery or further act. A lien of any pledge is valid and binding against all parties having claims of any kind in tort, contract or otherwise against the board irrespective of whether the parties have notice of the lien. When placed in the board's records, the resolution by which the pledge is created is notice to all concerned of the creation of the pledge.

F. Program funding obligations shall be sold at private sale to the state treasurer at a price and on terms provided by the board in its resolution pursuant to this section. The proceeds from the sale of program funding obligations shall be deposited into the fund and may be used for the purposes of the fund as set forth in section 41-5854.

G. Program funding obligations are:

Special obligations of the board.
Not obligations that are general, special or otherwise of this state.
Not a legal debt of this state.
Payable and enforceable only from the monies and fund pledged and assigned by the board in its resolution.

H. Any member of the board or a person executing a program funding obligation is not personally liable for the payment of the program funding obligation.

§ 41-5858 Quarterly reports

Within thirty days after the last day of each calendar quarter, the division staff, in collaboration with the board, shall submit to the speaker of the house of representatives, the president of the senate, the director of the joint legislative budget committee and the director of the governor's office of strategic planning and budgeting a quarterly report on the implementation of the program pursuant to this article. The quarterly report shall include at least the following information:

A listing of all outstanding guaranteed financings approved by the board, including the following information for each financing:

(a) The name of the public school or charter school by or on behalf of which the debt obligation was issued.

(b) The date of the issuance.

(d) The interest rate of the issuance.

(e) The term length of the issuance.

(f) The credit rating of the issuance.

(g) The amount of principal and interest due on the debt obligation in the current fiscal year.

(h) The purpose for which the debt obligation was issued, separately delineated for obligations to construct new capital facilities, renovate existing capital facilities or refinance existing debt obligations.

(i) The current outstanding principal of the debt obligation.

A listing of all guaranteed financings subject to section 41-5856 in the prior quarter, including the amounts disbursed for payment of principal and interest for the guaranteed financing and the terms and conditions the school is subject to under section 41-5856, subsections C, D and E.
The current balance of the Arizona public school credit enhancement fund.
The current program leverage ratio.

Chapter 57 Miscellaneous

Article 1 Vaccination Status

§ 41-5901 State agencies; vaccination inquiries prohibited

This state, any state agency or any contractor for this state may not send its employees to inquire about a person's vaccination status on a door-to-door basis.

Chapter 58 Natural Resource Conservation Districts

Article 1 General Provisions

§ 41-6001 Declaration of policy

It is declared the policy of the legislature to provide for the restoration and conservation of lands and soil resources of the state, the preservation of water rights and the control and prevention of soil erosion, and thereby to conserve natural resources, conserve wildlife, protect the tax base, protect public lands and protect and restore this state's rivers and streams and associated riparian habitats, including fish and wildlife resources that are dependent on those habitats, and in such manner to protect and promote the public health, safety and general welfare of the people.

§ 41-6002 Definitions

In this chapter, unless the context otherwise requires:

"Agency of this state" includes the government of this state and any subdivision, agency or instrumentality, corporate or otherwise, of this state's government.
"Agricultural lands" means irrigated farm lands or dry farm lands devoted to the purpose of agriculture.
"Board" means the state natural resource conservation board.
"Cooperative agreement" means an agreement between a district and an owner, lessee, permittee or manager of property within the boundaries of the district with responsibility for managing the land for the purposes of this chapter.
"District" means a natural resource conservation district organized in accordance with this chapter.
"District cooperator" means any person who has entered into a cooperative agreement with a natural resource conservation district for the purpose of protecting, conserving and practicing wise use of the natural resources under the district cooperator's control.
"Due notice" means notice published at least twice with an interval of at least six days between the two publication dates, in a newspaper of general circulation within the area affected, or if there is no newspaper of general circulation within the area affected, in a newspaper of general circulation in the county in which the area is located or at the physical location of meeting notices at least six days before the action or on the district website.
"Fund" means the natural resource conservation district fund.
"Government" or "governmental" includes the government of this state, the government of the United States, and any subdivision, agency or instrumentality, corporate or otherwise, of either of them.
"Irrigation district":

(a) Means an irrigation district, drainage district, water conservation district and agricultural improvement district.

(b) Includes any district, political subdivision, government agency, canal company, association, corporation or instrumentality of this state, having territorial boundaries and created or organized for the purpose of furnishing irrigation water for lands in this state.

"Landowner" or "owner of land":

(a) Means any person, firm or corporation, including this state, that holds title to any land lying within a district organized or proposed to be organized under this chapter.

(b) Includes:

(i) A buyer on contract who is the occupant of land.

(ii) A holder of a certificate of purchase or lease from this state.

"Nominating petition" means a petition to nominate candidates for the office of supervisor.
"Petition" means a petition for the creation or for the dissolution of a district.
"Qualified elector" means a person who is a district cooperator and a qualified elector of the state.
"Range lands" means lands other than agricultural lands that are devoted principally to the purpose of grazing livestock.
"Supervisor" means a member of the governing body of a district, elected or appointed in accordance with this chapter.
"United States" or "agencies of the United States" includes the United States, the United States department of agriculture and any other agency or instrumentality, corporate or otherwise, of the United States.

Article 2 Natural Resource Conservation

§ 41-6011 State natural resource conservation board; membership; powers and duties

A. The state natural resource conservation board is established consisting of the following members who are residents of this state:

Eight members who are from different geographic natural resource areas as defined by a statewide organization that represents all natural resource conservation districts in this state. Four members shall be appointed by the governor, two members shall be appointed by the president of the senate and two members shall be appointed by the speaker of the house of representatives. The members appointed pursuant to this paragraph shall meet the following criteria:

(a) At least six of the members must be elected supervisors for a natural resource conservation district.

(b) Not more than two members may be appointed supervisors from a soil and water conservation district.

(c) At least one member shall be a member of the executive board of a statewide organization that represents all natural resource conservation districts in this state.

Three members who are appointed by the governor from any of the following and who serve at the pleasure of the governor:

(a) The state land commissioner or state land commissioner's designee.

(b) The director of the Arizona department of agriculture or the director's designee.

(d) The director of the Arizona game and fish department or the director's designee.

B. The board shall elect a chairperson from among its members. The chairperson must be a member who represents a natural resource conservation district or soil and water conservation district.

C. The initial members of the board who are appointed pursuant to subsection A, paragraph 1 of this section shall assign themselves by lot to terms of one, two and three years in office. All subsequent members serve three-year terms. The chairperson of the board shall notify the governor's office of these terms.

D. If a member's term as a supervisor expires while serving on the board, that member may not serve out the member's term as a board member. A replacement shall be appointed from the same geographic resource area to fulfill the remainder of that member's term.

E. Board members shall be reimbursed for expenses as prescribed by title 38, chapter 4, article 2 while attending board meetings.

F. The board may appoint or contract for an administrative officer, a secretary and such other assistants as may be required, assign their duties, define their powers and determine the amount of bond required of any assistant entrusted with monies or property. The compensation of all such assistants shall be determined pursuant to section 38-611.

G. The board shall adopt a seal, which shall be judicially noticed, and shall hold public hearings, keep records of all proceedings and annual records of district operations, adopt orders and rules and perform other acts as are necessary to carry out this chapter.

H. The board shall:

Offer appropriate assistance to the supervisors of districts in carrying out their powers and programs.
Keep the supervisors of each district informed of the activities and experiences of other districts and of relevant information from other states, and facilitate cooperation and interchange of advice, experience and program opportunities between districts.
Coordinate the programs of the several districts insofar as possible by advice and consultation.
Require the supervisors of each district to file with the board annually any audits and the records of the operations of the district for the preceding year in the form and detail as the board prescribes.
Secure the cooperation and assistance of the United States, its agencies and agencies of this state, in the work of districts as local units of state government with special expertise concerning land, soil, water and natural resources management within the boundaries of the district, as the board deems for the best interest of the state.
Disseminate information throughout the state concerning the activities and program of districts.
Meet at least quarterly to receive updates from the board's administrative officer regarding any relevant issue or matter necessary to carry out this chapter, provide guidance to the administrative officer and vote on any matters requiring a decision by the board.
Assist a district when the district is cooperating or coordinating with a federal agency.
Assist districts with developing conservation action or district-wide plans.
Adopt administrative rules that the board deems necessary and proper to carry out this chapter.

I. The board may remove a district supervisor from office if the board determines, after reasonable notice and an impartial hearing, that the supervisor is guilty of misfeasance, malfeasance or nonfeasance in office. For the purposes of this subsection, "nonfeasance" includes the failure to attend three consecutive meetings of district supervisors without reasonable excuse.

J. The board, pursuant to chapter 4, article 4 of this title, may contract for or employ professional and administrative services. Contracts for professional services are exempt from chapter 23 of this title.

§ 41-6012 State financial assistance; application; criteria

A. The board shall include in the board's annual budget request a sum of not more than $40,000 for each natural resource conservation district and soil and water conservation district and $60,000 for each natural resource conservation district that operates an education center for distribution by the board to those natural resource conservation districts that have applied for, have met the criteria for and have been approved for receiving state financial assistance, as provided in this section.

B. Any district or education center desiring to receive state financial assistance for the next ensuing fiscal year shall apply to the board not later than June 20, on a form supplied by the board. Each application shall include:

The number of acres of land lying within the district.
The extent of conservation programs or education center programs proposed to be undertaken during the fiscal year for which the financial assistance is being requested.
Any audits that are requested by the board.

C. On receipt of the application, the board shall determine whether monies for the district or education center will be included in the board's budget request and shall promptly notify the district of that determination.

§ 41-6013 Environmental special plate fund; distribution

A. The environmental special plate fund is established and is administered by the board consisting of monies received pursuant to section 28-2413.

B. Subject to legislative appropriation, the board shall distribute $5,000 annually to each natural resource conservation district with an established education center for the purpose of developing and implementing an environmental education program that is conducted in a balanced manner, that is based on current scientific information and that includes a discussion of economic and social implications.

C. The fund established in this section is exempt from the provisions of section 35-190 relating to lapsing of appropriations. On notice from the board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

D. The appropriated monies shall only be used for the designated purposes specified in statute.

§ 41-6014 Natural resource conservation district fund; exemption; annual report

A. The natural resource conservation district fund is established consisting of legislative appropriations, grants, federal monies and other contributions. The board shall administer the fund. Monies in the fund are continuously appropriated and exempt from the provisions of section 35-190 relating to the lapsing of appropriations.

B. On notice from the board, the state treasurer shall invest and divest monies in the fund as provided by section 35-313, and monies earned from investment shall be credited to the fund.

C. The board shall do all of the following:

Establish criteria for the use of monies in the fund.
Establish and revise, as necessary, the grant application process.
Review and evaluate all submitted grant applications.
Award grants to natural resource conservation districts and soil and water conservation districts to conduct projects that further the purpose of the district. Grants awarded pursuant to this section are exempt from chapter 23 of this title.

D. Monies in the fund may not be used to acquire property.

E. Up to ten percent of the monies in the fund may be used by the board for the administration of the fund.

F. On or before December 31, 2025 and each year thereafter, the board shall submit a report describing the grants awarded from the fund during the previous fiscal year to the governor's office of strategic planning and budgeting, the president of the senate, the speaker of the house of representatives, the chairperson of the senate natural resources, energy and water committee, or its successor committee, and the chairperson of the house natural resources, energy and water committee, or its successor committee, and shall provide a copy of this report to the secretary of state.

Article 3 Formation, Change in Boundaries and Dissolution

§ 41-6031 Petition for creation of district

Twenty-five or more owners of land, but not less than twenty percent of the owners of land lying within the limits of a proposed district, or if there are fewer than twenty-five owners of land in the proposed district, not less than twenty-five percent of all such owners, may petition the board requesting that a district be organized. The petition shall contain:

The proposed name of the district.
A declaration that there is need, in the interest of preservation of property, health, safety and public welfare, for a district in the territory described.
A description of the exterior boundaries of the territory proposed to be organized.
A request that the board:

(a) Determine that the district be created.

(b) Define the boundaries of the proposed district.

§ 41-6032 Hearing on petition; notice

A. Within ninety days after a petition has been accepted by the board, notice of a hearing shall be given by publication in at least two issues, at intervals of not less than six days, of a newspaper of general circulation within the area affected. If there is no such newspaper, the publication shall be in a newspaper of general circulation within the county or the district shall post the notice on the district's website. The hearing shall include:

The desirability and necessity, in the interest of preservation of property, health, safety and public welfare, of the creation of such district.
The appropriate boundaries to be assigned to the district.
The propriety of the petition and other proceedings taken.
All related questions.

B. All owners of land within the limits of the territory described in the petition and of lands within any territory considered for addition to the described territory, and all other interested parties, may attend and be heard at such hearing.

C. If it appears on the hearing that it is desirable to include within the proposed district territory outside the area described in the petition, the hearing shall be adjourned and notice of further hearing given, in the manner provided by this section, in the entire area considered for inclusion in the district.

§ 41-6033 Determination by the board

A. If, after final hearing on a petition, the board determines on the facts presented and other relevant information that a district within the territory considered is in the public interest, the board shall record such determination and define the boundaries of the district. In defining the boundaries, the board shall consider:

The topography of the area.
The character of soils.
The distribution of erosion.
Prevailing land use practices.
The desirability and necessity of including within the boundaries of the district the particular lands under consideration and the benefits to be received by such inclusion.
The relation of the proposed area to existing watersheds and agricultural regions, and to other districts already organized or proposed for organization.
Such other physical, geographical and economic factors as are relevant.

B. In defining the boundaries of the district, the board shall not include therein any area, land or property of any person or persons who do not desire to have such area, land or property included in such district. Notwithstanding any provision of this chapter to the contrary, lands held under certificate of purchase or lease from this state shall not be included in any district if the holder or holders of certificates of purchase or the leases therefor do not desire such lands included.

C. If the board determines that it is not in the public interest for a district to function in the territory considered, the board shall record such determination and deny the petition.

D. Eighteen months after the date of entry of a determination by the board that operation of a proposed district is not administratively and economically feasible, and denial of a petition pursuant to that determination, petitions may again be filed and action taken in accordance with this chapter.

§ 41-6034 Referendum; election of supervisors

A. Within a reasonable time after the board has recorded its determination that it is in the public interest that a district be organized, and has defined the boundaries thereof, the board shall hold a referendum within the proposed district on the question of the creation of the district, and an election to elect three supervisors. The board shall adopt rules for the conduct of such referendum and election and prescribe a procedure for the determination of persons eligible to vote. The referendum and election of supervisors shall be conducted by separate ballots.

B. The ballot for the referendum shall:

Describe the boundaries of the proposed district as determined by the board.
Contain the propositions: "For the creation of a district" and "against the creation of a district", with a square after each proposition.
An instruction to mark an X in the square after the proposition for which the voter wishes to vote.

C. Only owners of land lying within the boundaries of the territory described shall be eligible to vote on the referendum, but any such owner who is not a qualified elector of the district, or any owner who is a qualified elector but is unable because of illness or absence from the district to appear at the polls, may appoint in writing, on a form prescribed by the board, a qualified elector of the district as the owner's agent or proxy. The appointment of agent or proxy shall be presented to the board of election, and if it is found to be bona fide and in proper form, the holder thereof shall be allowed to vote in behalf of the owner executing the appointment on the question of creation of the district only. The appointment shall be filed with the ballots and other election returns.

D. Candidates for supervisor shall file nomination petitions with the board in the manner prescribed by the board. Any qualified elector of the proposed district may sign the petitions of not more than three candidates. The names of candidates shall appear on the election ballot in alphabetical order by surnames, with a square opposite each name, and an instruction to mark an X in the squares opposite the names of not more than three candidates for whom the voter wishes to vote.

E. No informality in the conduct of any referendum or election held under this chapter, or in any matter relating thereto, shall invalidate the result thereof if notice has been given substantially as prescribed in section 41-6032, and the referendum and election have been fairly conducted. All expenses of a referendum and election shall be paid by the board.

§ 41-6035 Proclamation of result of referendum and election; terms of supervisors

A. If not less than sixty-five percent of the landowners voting at the referendum and the owners of not less than fifty percent of the land, other than publicly owned, lying within the proposed district vote in favor of the creation thereof, the board shall declare the district organized. Otherwise the board shall declare the proposal defeated.

B. The three candidates receiving the highest number of votes at the election for supervisors shall be declared elected. Their terms shall begin on the date of filing the oath of office with the secretary of state. The term of the candidate receiving the largest number of votes shall terminate on May 31 of the third even-numbered year, of the candidate receiving the next largest number of votes on May 31 of the second even-numbered year, and of the candidate receiving the next largest number of votes on May 31 of the first even-numbered year following the election.

§ 41-6036 Proceedings to organize district; certificate of organization

A. A district shall be organized and shall be a body corporate on taking the following steps:

The supervisors elected as provided in section 41-6035 shall present to the secretary of state an application, signed and acknowledged by each supervisor, setting forth:

(a) That a petition for the creation of the district was approved by the board pursuant to this chapter.

(b) The name and official residence of each supervisor, and a certified copy of their notification of election.

(d) The location of the proposed office of the supervisors of the district.

The application shall be accompanied by a certificate of the board that shall set forth:

(a) The boundaries of the district as determined by the board.

(b) That a petition was filed, notice was issued and a hearing was held as prescribed by law.

(d) That notice was given and a referendum on the question of the creation of the district and an election of supervisors were held.

(e) That the results of the referendum showed not less than sixty-five percent of the votes cast, representing not less than fifty percent of the owners of land, to be in favor of the creation of the district.

(f) That the supervisors signing the application are the duly elected supervisors of the district.

The secretary of state shall examine the application and statement and, if the secretary of state finds that the name proposed for the district is not identical or so similar to that of any other district as to lead to confusion, the secretary of state shall record them. If the name proposed is identical or so similar to another district as to lead to confusion, the secretary of state shall certify that fact to the board, which shall submit another name. On receipt of a new name, free from defects, the secretary of state shall record the application and statement.

B. The secretary of state shall issue to the supervisors a certificate, under the seal of this state, certifying the organization of the district, and record the certificate with the application and statement. The district shall include the territory as determined by the board, but it shall not include any area within the boundaries of another district and shall not include any area, land or property of or lands held under certificate of purchase or lease from the state by any person or persons, which area, land, property or leaseholds lie within the geographical limits of such district but the owners or holders of certificates of purchase or lessees of which do not desire to come within the district.

C. In any action or proceeding involving the validity or enforcement of, or relating to, any contract, proceeding or action of the district, the district shall be deemed to have been established in accordance with this chapter on proof of the issuance of the certificate of organization by the secretary of state. A copy of the certificate certified by the secretary of state shall be admissible in evidence in any action or proceeding, and shall be proof of the filing and contents thereof. In like manner, any district combined, and consolidated with an adjacent district or districts, and reorganized and renamed before June 20, 1968 shall be deemed to have been established on proof of certifications and official maps filed with the secretary of state by the board.

D. The board shall appoint two supervisors from a panel of candidates compiled by the elected supervisors and presented by the temporary chairman of the elected supervisors. Candidates for the office of appointed supervisors shall be qualified electors of the state. Appointed supervisors shall continue to serve until May 31 of the next even-numbered year or until their successors are otherwise appointed.

§ 41-6037 Addition of territory

A. Territory adjacent to an organized district may be included in the district on a petition signed by seventy-five percent of the owners of land, other than publicly owned land, within the territory proposed for addition filed with the district supervisors, requesting the inclusion of their lands in the district.

B. The supervisors shall hold a public hearing on the advisability and feasibility of including the additional territory, notice of which shall be given by posting at least two weeks before the date of the hearing in the office of the supervisors and such other public notice as the supervisors may deem proper. If, after such hearing, the supervisors recommend and the board, on a review of the findings of the supervisors, approves, the additional land shall become a part of the district. The board shall certify the action to the secretary of state, and the certificate shall be filed with the original certificate of organization of the district.

C. No area, land, property of or lands held by any person under lease or certificate of purchase from the state shall be included in any territory added to any district if the owner or owners of such area, lands, property, certificate of purchase or leaseholds do not desire them to be included in such district.

§ 41-6038 Dissolution of district

A. At any time after five years following the organization of a district, any twenty-five owners of land or not less than twenty percent of the owners of land lying within the boundaries of the district may file a petition with the board praying that the operations of the district be terminated and its existence discontinued. The board shall conduct such public meetings and hearings on the petition as may be necessary to assist in the consideration thereof.

B. Within sixty days after filing of the petition, the board shall give notice of the holding of a referendum, and shall supervise the referendum and issue appropriate regulations governing the conduct thereof. The question shall be submitted by ballots on which the propositions, "For terminating the existence of the (name of district)" and "against terminating the existence of the (name of district) "shall be printed, with a square after each proposition and an instruction to mark an X in the square following the proposition for which the voter desires to vote. Only owners of lands lying within the boundaries of the district shall be eligible to vote on the referendum. No informality in the conduct of the referendum or in any matter relating thereto shall invalidate the referendum or the result thereof, if due notice thereof has been given substantially as provided in this chapter and the referendum has been fairly conducted.

C. If sixty-five percent of the landowners voting thereon vote to terminate the existence of a district, the board shall advise the supervisors to conclude the affairs of the district. The supervisors shall dispose of all property belonging to the district at public auction and shall transmit the proceeds of the sale to the state treasurer for deposit, pursuant to sections 35-146 and 35-147.

D. After disposing of the property and transmitting the proceeds of the sale pursuant to subsection C of this section, the supervisors shall file a verified application with the secretary of state for discontinuance of the district, together with the certificate of the board setting forth the determination of the board that the continued operation of the district is not administratively feasible. The application shall recite that the property of the district has been disposed of and the proceeds paid over as provided in this section, and shall include a full accounting of the properties and the proceeds of the sale. The secretary of state shall issue to the supervisors a certificate of dissolution, and shall record the certificate in the secretary of state's office.

E. The board shall not entertain a petition for the discontinuance of any district, nor conduct a referendum thereon, nor make any determination pursuant thereto, more than once in five years.

§ 41-6039 Status following dissolution

On the issuance of a certificate of dissolution as provided in section 41-6038, the ordinances and regulations theretofore in force within the district shall be of no further effect. Any contract theretofore entered into to which the district or supervisors are parties shall remain in force for the period provided therein, and the board shall be substituted for the district or supervisors as a party thereto. The board shall be entitled to all benefits and subject to all liabilities under any such contract and shall have the same right and liability to perform, require performance, sue and be sued thereon, and to modify or terminate the contract by mutual consent or otherwise, as the supervisors of the district would have had. Dissolution shall not affect the lien of any judgment entered under this chapter, nor the pendency of any action instituted thereunder, and the board shall succeed to all the rights and obligations of the district or supervisors as to such liens and actions.

§ 41-6040 Change in boundaries; combination or division of districts; change in name of districts

A. Petitions for a change in the boundaries of existing districts, or the combination of two or more existing districts may be filed with the state natural resource conservation board by a majority of supervisors of the board or boards of supervisors of the district or districts to be affected. In the case of a proposed combination of two or more existing districts, the petition shall state the proposed boundaries of the new combined district, the proposed name, and shall propose a method, which has been mutually agreed on by all boards of supervisors of affected districts, as to the future terms of office of existing district supervisors, and how such terms will be determined. The state natural resource conservation board may require such hearings as the state natural resource conservation board deems appropriate to enable the state natural resource conservation board to make a determination as to the desirability of the proposed changes. If the state natural resource conservation board makes a determination in favor of the changes, the state natural resource conservation board shall certify the fact of such change to the secretary of state and shall notify the board of supervisors of the district, or districts, setting out in such notice the new boundaries and the name of the district and confirmation of terms of the supervisors. The secretary of state shall make and issue a corrected certificate of organization on receipt of such certification from the state natural resource conservation board.

B. The board of supervisors of any one or more districts organized under this section may submit to the state natural resource conservation board a petition signed by a majority of the members of the board of supervisors of each district affected requesting a division of a district, a combination of two or more districts, or a transfer of land from one district to another. The state natural resource conservation board shall make a determination as to the practicability and feasibility of the proposed change, giving due regard to the same considerations as provided in this section for changes in district boundaries by other methods. If the state natural resource conservation board determines that the proposed change of district boundaries is not administratively practicable and feasible, the state natural resource conservation board shall record such determination and deny the petition. If the state natural resource conservation board determines that the proposed change is administratively practicable and feasible, the state natural resource conservation board shall record such determination and proceed with the reorganization of the district or districts affected in the same manner as provided in this section for changes in district boundaries by other methods.

C. Petitions for a change in the name of a district may be submitted to the state natural resource conservation board by a majority of supervisors of the board of supervisors of a district. If the state natural resource conservation board approves the change of name, the state natural resource conservation board shall certify the fact of such change of name to the secretary of state and shall notify the board of supervisors of the district of such change, setting out in such notice the new name of the district. The secretary of state shall make and issue a corrected certificate of organization on receipt of such certification from the state natural resource conservation board.

Article 4 Administration

§ 41-6051 District supervisors; term of office; biennial election

A. The governing body of a district shall consist of five supervisors, three of whom are to be elected and two appointed by the board from a list of nominees selected by the elected supervisors. Except as to the first supervisors, whose election and terms are prescribed in section 41-6035, the term of each elected supervisor shall be six years, beginning on June 1 following the supervisor's election. As prescribed in section 41-6036, the terms of the two supervisors appointed by the board shall be until May 31 of the next even-numbered year, or until their successors are otherwise appointed.

B. An election shall be held on the first Saturday in May of each even-numbered year, at which one supervisor of the district shall be elected. Any person desiring to be a candidate shall file with the board a nomination petition in such form as the board prescribes, at least ten days before the election, containing the signatures of not less than one-half of one percent of the qualified electors of the district or five qualified electors of the district, whichever is higher. No person shall be eligible to be a candidate for supervisor unless the person is a qualified elector of the district. The names of candidates shall appear on the ballot in alphabetical order by surnames, with a square after each name and an instruction to mark an X in the square after the name of the voter's choice. The governing body of a district may provide a mail ballot to a qualified district elector for which the district governing body has a first class mailing address. Qualified electors of a district who wish to vote by mail ballot shall file a first class mailing address with the district governing body at least thirty days before the date of the election. Qualified district electors who receive ballots in proper form from the district governing body may cast their votes by mail. Mail ballots, to be counted, shall be received at the place designated, and within the time prescribed by the district supervisors and clearly specified in the notice of election. Only qualified electors of the district shall have the right to vote. The district governing body shall provide at least one polling place in the district for qualified voters who wish to vote in person. If two or more candidates receive the same number of votes, the successful candidate shall be determined by lot. If only one person files a nominating petition for an election to fill a position on the district board for which the term of office is to expire, the board may cancel the election for that position and instead may appoint the person who filed the nominating petition to fill the position. If no person files a nominating petition for an election to fill a district office, the board may cancel the election for the offices and the office shall be filled as otherwise provided by law. A person who is appointed pursuant to this subsection is fully vested with the powers and duties of the office as if elected to that office.

§ 41-6052 Organization of supervisors; vacancies

A. At the first meeting of the supervisors following an election, they shall organize by electing a chairman and a vice chairman and such other officers as are deemed necessary from among their number to serve for the ensuing two years.

B. If a vacancy occurs in the office of an elected supervisor otherwise than by expiration of term, the board may appoint a qualified elector of the district to serve until June 1 of the next even-numbered year, when a successor shall be elected for the remainder of the term.

C. District supervisors may employ a secretary and such other agents, employees and technical or professional experts as they may from time to time require, and may determine qualifications, compensation and duties applicable to any agent, employee or expert engaged.

§ 41-6053 Powers and duties of supervisors

A. The supervisors shall:

Provide for the keeping of a record of all policies, proceedings, resolutions, regulations and orders issued or adopted.
Furnish to the board copies of such ordinances, rules, regulations, orders, contracts, forms or other documents adopted or employed, audits of the district or education center and such information concerning their activities as the board requests.

B. The supervisors may appoint additional advisory members to the district governing body and delegate to the chairman or any member, or to any agent or employee, such powers and duties as they deem proper.

C. District supervisors shall require and provide for the execution of a corporate surety bond in suitable penal sum for, and to cover, any person entrusted with the care or disposition of district monies or property.

D. The compensation of the district supervisors shall be determined by the supervisors meeting as the governing body of the district but shall not exceed the compensation prescribed by section 38-611, plus actual and necessary expenses of attending district meetings, and a per diem subsistence allowance and actual and necessary expenses while engaged in official business by order of the supervisors.

§ 41-6054 Powers of district

A. This state recognizes the special expertise of the districts in the fields of land, soil, water and natural resources management within the boundaries of the district. A district is empowered to:

Conduct surveys, investigations and research relating to the character of the soil, soil erosion prevention within a farm or ranch, methods of cultivation, farm and range practices, seeding, eradicating noxious growths and invasive vegetation and any other measures that will aid farm and range operations, disseminate information and educate landowners pertaining thereto, and carry on research programs with or without the cooperation of this state or its agencies or the United States or its agencies.
Create and administer a soil health program that promotes implementation of soil health practices, research projects, demonstration projects, educational projects or other activities appropriate to promote the continuing capacity for soil to function as a vital living biological system that sustains plants, animals and humans, increased soil organic matter, improved soil structure, water-holding and nutrient-holding capacity or nutrient cycling.
Conduct demonstration projects within the district on lands owned or controlled by the state or any of its agencies with the consent and cooperation of the agency having jurisdiction of the land, and on any other lands within the district on obtaining the consent of the landowner or the necessary rights or interests in the land, in order to demonstrate by example the means, methods and measures by which water, soil and soil resources may be conserved and soil erosion and soil washing may be prevented and controlled.
Cooperate, coordinate and enter into agreements with a landowner, an operator or any agency or subdivision of the state or federal government to carry on programs of watershed improvement, soil erosion prevention, methods of cultivation, cropping practices, land leveling and improvement on agricultural lands, and programs limited to methods of proper range land use, reseeding and eradicating noxious growth and invasive vegetation on grazing lands, all within the limits of an individual farm or ranch and subject to the conditions the supervisors deem necessary.
Acquire, by purchase, exchange, lease or otherwise, any property, real or personal, or rights or interest in any property, maintain, administer and improve any properties acquired, receive income from any property or right or interest in property and expend it in carrying out the purposes of this chapter, and sell, lease or otherwise dispose of any property or interest in property in furtherance of the purposes of this chapter.
Make available, on the terms it prescribes to landowners within the district, agricultural and engineering machinery and equipment, fertilizer, seed and other material or equipment as will assist the landowners to carry on operations on their lands for the purposes and programs authorized by this chapter.
Develop, publish and bring to the attention of landowners within the district comprehensive plans for conserving soil and water resources within the district that specify in such detail as may be feasible the acts, procedures, performances and avoidances necessary or desirable to effect the plans.
Apply for, receive and spend monies from the Arizona water protection fund pursuant to title 45, chapter 12 to be used in individual districts or in cooperation with other districts, persons, cities, towns, counties, special districts and Indian communities for projects consistent with title 45, chapter 12.
Employ agents, engineers, attorneys or other employees not readily available from existing state agencies.
Sue and be sued in the name of the district, have a seal, which shall be judicially noticed, have perpetual succession unless terminated as provided in this chapter, make and execute contracts and other instruments necessary or convenient to exercise its powers and make, amend and repeal rules not inconsistent with this chapter to effect its purposes and powers.
Apply for grants and accept donations, gifts and contributions in monies, services, materials or otherwise, and use or expend them in carrying on its operations.
Organize and establish an education center to increase the knowledge of natural resources in this state through the following methods:

(a) Offering technical guidance and training to agricultural producers.

(b) Publishing scholarly materials.

(d) Conducting or sponsoring scientific studies that affect natural resources in this state.

(e) Increasing public awareness of water conservation statewide, including water conservation methods and best management practices.

(f) Increasing public awareness of soil health practices statewide.

Apply for, receive and spend monies from the water infrastructure finance authority of Arizona pursuant to title 49, chapter 8 to be used in individual districts or in cooperation with other districts and cities, towns, counties, special districts, Indian communities and other persons for projects consistent with title 49, chapter 8.

B. A provision of law with respect to acquiring, operating or disposing of property by other public bodies is not applicable to a district organized under this chapter unless specifically stated therein.

C. After the formation of any district under this chapter, all participation thereunder shall be voluntary, notwithstanding any provision of this chapter to the contrary.

D. A district may send to the board and the Arizona water protection fund commission established by title 45, chapter 12 written recommendations for geographic areas to be emphasized, issues of concern and measures to implement title 45, chapter 12. A district that sends written recommendations to the commission shall request information from at least the following:

The director of the department of water resources and the board.
The federal and state fish, wildlife, recreation and natural resource agencies.
County and municipal entities.
The public.

E. The district shall develop procedures to ensure adequate participation in the public involvement process prescribed by subsection D of this section.

§ 41-6055 Limitation of powers

A. This chapter does not affect existing water rights and does not in any manner contravene the provisions of title 37.

B. No district or public body shall undertake or cooperate in the planning, construction, improvement or maintenance of any structure, dike or channel for the storage, spreading, diversion or conveyance of water resulting in the consumptive use of water, on any watershed or drainage area that supplies or contributes water for the irrigation of lands within any irrigation district or for the irrigation of other lands having established rights in such water, without first submitting the plans therefor to the governing body of such irrigation district or districts. Such governing body shall within forty-five days after receipt of such plans either approve or reject them. The approval may be given for rangeland soil conservation practices by agreement on an annual or continuing basis between the governing bodies of the affected irrigation districts and the supervisors of such natural resource conservation districts. If the governing body fails to approve or reject the plans within forty-five days, it shall be deemed to have approved them. If the governing body rejects the plans, the district or public body proposing such plans may appeal to the board. The appeal shall be taken within forty-five days after such decision. The board shall review the decision, and may approve the plans only if after an investigation and hearing the board finds that the work proposed to be done will not result in the consumptive use of water. An appeal from the decision of the board may be taken by either party pursuant to title 41, chapter 6, article 10. This subsection does not preclude the use of any other legal remedy otherwise available to any person or interested party.

C. The diversion, application or use of water by means of any improvement constructed, maintained or operated under this chapter is not an appropriation of or does not vest any right to the use of public water.

§ 41-6056 Cooperation between districts

The supervisors of any two or more districts organized under the provisions of this chapter may cooperate in the exercise of any power conferred in this chapter.

§ 41-6057 Cooperation by state agencies

Agencies of this state which have jurisdiction over or are charged with the administration of any state-owned lands, and of any county or other governmental subdivision of the state which have jurisdiction over, or are charged with the administration of, any county owned or other publicly owned lands lying within the boundaries of any natural resource conservation district, may cooperate fully with the supervisors of such districts in the effectuation of programs and operations undertaken by the supervisors under the provisions of this chapter. The supervisors of any district organized under the provisions of this chapter may cooperate with any municipality within the boundaries of the district on matters relating to soil conservation or land use planning.

Chapter 59 Independent Correctional Oversight Office

Article 1 General Provisions

§ 41-7001 Definitions

In this chapter, unless the context otherwise requires:

"Department" means the state department of corrections.
"Director" means the director of the independent correctional oversight office.
"Office" means the independent correctional oversight office.
"Record" has the same meaning prescribed in section 41-1371.

§ 41-7002 Independent correctional oversight office; director; appointment; term; qualifications; powers and duties; annual report

A. The independent correctional oversight office is established. The governor shall appoint a qualified person pursuant to section 38-211 of sound judgment, objectivity and integrity who has experience in corrections-related law and policy to serve as the director of the office. The director shall serve full-time and for a term of five years and shall be a public officer subject to title 38, chapter 3, article 8 relating to conflicts of interest. The director is eligible to receive compensation pursuant to section 38-611. The legislature, by concurrent resolution receiving a two-thirds majority vote of the members of each house, or the governor may remove the director only for neglect of duty, misconduct or the inability to perform duties. Any vacancy must be filled by similar appointment pursuant to this subsection for the remainder of the unexpired term.

B. A person is not eligible for appointment to the office pursuant to subsection A of this section if the person or the person's spouse meets any of the following criteria:

Is or has been employed by or participates in the management of a business or other organization that received monies from the department within the previous ten years.
Owns or controls, directly or indirectly, any interest in a business or other organization that received monies from the department within the previous five years.
Uses or receives any amount of tangible goods, services or monies from the department.
Is required to register as a lobbyist on behalf of a profession related to the operation of the department.

C. The office shall:

Monitor the conditions of confinement and assess the department's compliance with any applicable federal and state rules, policies and best practices that relate to inmate health, safety, welfare and rehabilitation.
Provide information, as appropriate, to inmates, inmates' family members, inmate representatives, department employees and contractors and any other persons regarding the rights of inmates.
Promote public awareness and understanding of the rights and responsibilities of inmates.
Create a secure telephone hotline that is available to all department employees, contractors and inmates to file complaints and make inquiries regarding issues on their behalf.
Create secure online forms for all department employees, inmates and inmates' family members to submit complaints electronically on the office's website.
Establish priorities for the use of the office's limited resources.
Monitor and participate in any legislative and policy developments affecting correctional facilities in this state.
Establish a statewide uniform reporting system to collect and analyze data related to complaints received by the department.
Inspect each correctional facility at least once every two years.
Adopt any rules necessary to implement this section.
Establish procedures to gather stakeholder input into the office's activities and priorities, including scheduling quarterly stakeholder meetings.
On or before December 31 of each year, submit a report to the president of the senate, the speaker of the house of representatives, the minority leader of the senate, the minority leader of the house of representatives, the chairperson of the senate judiciary and elections committee, or its successor committee, and the chairperson of the house of representatives judiciary committee, or its successor committee, that includes all of the following:

(a) The budget and expenditures of the office.

(b) The number of complaints received and resolved by the office.

(c) A description of significant systemic or individual investigations or outcomes achieved by the office during the previous year.

(d) The number of inmate deaths while the inmate was in custody and the manner and cause of death, if known, including suicides and the number of suicide attempts while the inmate was in custody.

(e) The number of inmates with a completed medical power of attorney on file.

(f) The number of inmates who were transported for medical treatment or to the emergency room or who were hospitalized while in custody, including the duration of the stay in the emergency room or the hospital.

(g) The number of drug overdoses, including fatal and nonfatal drug overdoses, per inmate while in custody.

(h) The number of inmates who have a mental health assessment score of three or higher or who are designated as seriously mentally ill and the security classification and housing status of each inmate who has a mental health assessment score of three or higher or who is designated as seriously mentally ill, including the number of inmates placed in isolation or restrictive housing for any duration of time in each facility.

(i) Any outstanding or unresolved concerns or recommendations of the office.

(j) All of the following information from the department:

(i) The number of physical and sexual assaults in custody.

(ii) The number of inmates who were placed in restrictive housing, administrative segregation or solitary confinement and the duration of stay in restrictive housing, administrative segregation or solitary confinement in each facility.

(iii) The number of facility lockdowns that lasted twenty-four hours or longer.

(iv) The number of staff, the tenure of each staff member, the staff turnover rate, staff vacancies and the staff compensation at each facility.

(v) The number of inmates at each facility.

(vi) The inmate-to-staff ratio at each facility.

(vii) The number of in-person visits that were made for each inmate at each facility.

(viii) The number of in-person visits that were denied for each inmate at each facility.

(ix) The number of inmate complaints or grievances that were submitted to the department, the department's resolution of the complaint or grievance pursuant to the administrative remedies process and the amount of time it took the department to resolve each complaint or grievance.

(x) An overview of the department's current inmate classification scoring system, including the criteria and scoring matrix used to assign inmate custody levels, and any changes made to the inmate classification scoring system since the last report.

(xi) The number of inmates who are housed in a facility or unit with a custody level above or below the inmate's assigned classification level.

(k) The department's compliance with all of the following:

(i) The transition program established pursuant to section 31-281.

(ii) The release and reporting provisions prescribed in section 31-285.

(iii) The requirement as prescribed in section 41-1602 to provide rehabilitation, and the number of inmates who enroll, participate in and complete the department's rehabilitative self-improvement and treatment programs by institution and a description of each program.

(iv) The earned release credit program pursuant to sections 41-1604.06, 41-1604.07 and 41-1604.10.

(v) The reporting requirement pursuant to section 41-1604.14.

(vi) The department's own policies regarding industry-recommended reporting guidelines.

D. On or before October 31 of each year, the department shall provide all of the information required by subsection C, paragraph 12, subdivisions (d), (e), (f), (g), (h) and (j) of this section to the office.

§ 41-7003 Scope of investigations; complaints; investigative authority

A. The office may initiate and attempt to resolve an investigation on its own initiative or after receiving a complaint from an inmate, inmates' family member, inmate representative or department employee or contractor or any other person regarding any of the following that may adversely affect inmate health, safety, welfare or rights:

Abuse or neglect.
Conditions of confinement.
Department decisions or administrative actions.
Department inactions or omissions.
Department policies, rules or procedures.
Alleged violations of law by department staff.

B. The office may decline to investigate any complaint. If the office does not investigate a complaint, the office shall notify the complainant in writing of the decision not to investigate and the reasons for the decision.

C. The office may not investigate either of the following complaints:

A complaint that relates to an inmate's underlying criminal conviction.
A complaint from a department employee or contractor that relates to the employee's or contractor's employment relationship with the department unless the complaint relates to inmate health, safety, welfare or rehabilitation.

D. The office may refer the complainant and others to appropriate resources or state, tribal or federal agencies.

E. The office may not levy any fees for the submission or investigation of complaints.

F. The office shall remain neutral and impartial and may not act as an advocate for the complainant or the department.

G. After investigating a complaint, the office shall render a public decision on the merits of each complaint, except that the documents supporting the decision are subject to the confidentiality provisions of section 41-7005. The office shall inform the complainant and the department of the decision. The office shall state the office's recommendations and reasoning if, in the office's opinion, the department or any department employee or contractor should do any of the following:

Consider the matter further.
Modify or cancel any action.
Alter a rule, practice or ruling.
Explain in detail the administrative action in question.
Rectify an omission.

H. On the request of the office, the department, within the time specified by the office, shall inform the office in writing about any action taken on the recommendations or the reasons for not complying with the recommendations.

I. If the office believes, based on the investigation, that there has been or continues to be a significant inmate health, safety, welfare or rehabilitation issue, the office shall report the finding within ten business days to the governor, the attorney general, the president of the senate, the speaker of the house of representatives and the director of the department and shall provide a copy of this report to the secretary of state.

J. Before announcing a conclusion or recommendation that expressly or implicitly criticizes a person or the department, the office shall consult with that person or the department. The office may request to be notified by the department, within a specified time, of any action taken on any recommendation presented.

K. The office's action or lack of action on a complaint made pursuant to this chapter is not deemed an administrative procedure required for exhaustion of remedies before bringing an action pursuant to 42 United States Code section 1997e or filing a notice of claim pursuant to section 12-821.01.

§ 41-7004 Inspection; rights and services; information; access

A. The office shall have access, in person and with or without prior notice, to all facilities, including all areas that are used by or are otherwise accessible to inmates, department staff and contractors, to programs for inmates at reasonable times, including access during normal working hours and visiting hours, and to any inmate, department employee, contractor or other person to conduct interviews for the purpose of either of the following:

Providing information about individual rights and the services available from the office, including the name, address and telephone number of the office facilities or staff.
Conducting official inspections.

B. The office may access, inspect and copy all relevant information, records or documents that are in the possession or control of the department and that the director considers necessary in an investigation of a complaint filed or to complete any reporting requirements pursuant to this chapter. The department shall assist the office in obtaining the necessary releases for any documents that are specifically restricted or privileged.

C. Following notification from the office with a written demand for access to department records, the designated department staff shall provide the office with access to the requested documentation not later than twenty business days after the office's written request for the records. If the requested records pertain to an inmate death, threats of bodily harm, including sexual or physical assaults, or the denial of necessary medical treatment, the department shall provide the records within five days, unless the office consents to an extension of that time frame.

D. The office shall work with the department to minimize disruption to the operations of the department due to office activities and shall comply with the department's reasonable security clearance processes, if these processes do not impede the activities allowed by this section.

§ 41-7005 Confidentiality; communications; procedures; information

A. All correspondence and communication between the office and the department are confidential and privileged.

B. The office shall establish confidentiality rules and procedures for all information maintained by the office to ensure that the identity of a complainant remains confidential before, during and after an investigation to the greatest extent practicable. The office may disclose a complainant's identifying information for the sole purpose of carrying out an investigation.

C. To the extent the office believes is reasonably necessary, the office:

Shall reveal information obtained in the course of an investigation to prevent reasonably certain death or substantial bodily harm.
May reveal information obtained in the course of an investigation to prevent the commission of a crime.

D. If the office believes it is necessary to reveal information pursuant to subsection C of this section, the office shall provide a copy of the intended disclosure to the department for review before releasing the information to any other person or entity. If the office receives personally identifying information about a person during the course of an investigation that the office determines is unrelated or unnecessary to the investigation, the office may not further disclose such information.

§ 41-7006 Protections; immunity; exceptions

A. A civil action may not be brought against the director or the staff of the office for any action or omission in performing the duties under this chapter, except for gross negligence or intentional wrongful acts or omissions and except as provided in title 38, chapter 3, article 8.

B. A proceeding or decision of the director may be reviewed in superior court only to determine if it is contrary to this chapter.

C. The director and the staff of the office may not be required to testify in court regarding matters that come to their attention in the exercise of their duties, except as may be necessary to enforce this chapter.

D. Records and files maintained by the director and the staff of the office are not public records and are exempt from title 39, chapter 1.

§ 41-7007 Corrections oversight fund

A. The corrections oversight fund is established consisting of legislative appropriations, federal monies and private grants, gifts, contributions and devises. The office shall administer the fund.

B. The director may accept and spend federal monies and private grants, gifts, contributions and devises to assist in carrying out the purposes of this chapter.

C. Monies in the fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.