Legislative Update

The Arizona Legislature was very active this session.  They posted 1158 bills and passed 282 of them.  The Governor vetoed 24 and has signed 2454 into law or allowed them to become effective by not vetoing them within a timely window.  Most of these laws will go into effect September 13, 2013.  So which of these new bills are relevant to landlords?

1. Small Claims Jurisdiction (ARS § 22-503): Does not go into effect until January 1, 2014.

The small claims jurisdictional limit was raised from $2500.00 to $3500.00.

2. Peace Officer’s Early Termination of Lease (ARS § 33-1318.01):

This law essentially allows a person who meets the statutory definition of a peace offer to terminate his lease early under specific requirements that are similar to the domestic violence early termination clause.  The one major difference between the two provisions is that this law requires the tenant to pay back any rent concessions they actually received prior to the early termination request.

3. Foreclosure Notification (ARS § 33-1331):

The landlord is now required to notify the tenant in writing of the landlord’s knowledge that a Notice of Trustee’s Sale has been issued if a lease has already been entered into.  This notice must be given within five (5) days of when the landlord receives the first notice that the property has gone into the foreclosure process.  This new law expands the previously law that requires the landlord to include a written provision in the lease that the home is presently set for a Trustee’s Sale and to include the specifics (date, place and name of Trustee) of that Sale in the terms of the lease.  As a reminder, the Protecting Tenants at Foreclosure Act is still in effect and protects a tenant’s leasehold rights if they qualify under the Act.  A tenant may potentially give the landlord a 10-day breach of lease notice alleging that the act of allowing the home to go into foreclosure is a breach that, if not resolved within ten (10) days, would allow tenant to terminate the lease and cause the landlord to have liability for the breach.  A landlord must provide the tenant with “reasonable assurances” that the Trustee’s Sale will either be cancelled because the landlord will resolve the issue with the lender or that the tenant’s rights will be protected after the sale because the landlord will take steps to notify the new owner that this tenant is a bona-fide tenant and current with their rent.

4. Transaction Privilege Tax (HB2111): Does not go into effect until January 1, 2015

This bill was one of the most hotly contested issues in the session.  This bill changed a number of aspects of the TPT system including prime contracting.  One of the biggest impacts on landlords is that it eventually allows them to pay on-line to the State of Arizona one tax and eliminate the requirement to pay each city a TPT.  There are also changes involving contractors’ and subcontractors’ obligations regarding TPT.

5. New Tempe Nuisance Ordinance

The city of Tempe has updated their Nuisance Party Ordinance with some elements that affect both apartment complexes and single owners. This new ordinance allows police to cite partiers on the first response of officers to the gathering. Officers can also post the citation on the door of the residence. This new ordinance does allow the city of Tempe to hold landlord accountable, but only if they hosted the party or did not take responsible action to prevent future occurrences. There is an appeal process for disputing the payment of fees.
Officers can now provide the citation through personal service, posting and certified mailing, return receipt requested.

  1. Landlords are required to provide names of any and all occupants on leasing documents for locations police responded for nuisance parties upon request.
  2. An owner will not be charged a nuisance fee unless they were present of had knowledge of the nuisance party or took no reasonable action to prevent it, police respond to another occurrence that takes place within ninety (90) days of the first notice, or the owner/landlord fails to provide requested leasing information.
  3. The city of Tempe can waive the fee if proof is provided reasonable steps were taken to prevent the nuisance party before or after (to prevent future occurrences).