AMA bill on abandoned property signed into law
By Courtney Levinus & Jake Hinman
As far as excitement goes, the 2018 Legislative Session has not been a disappointment. At the time of our last update we knew about the State’s plans for investing in K-12 education, combatting the opioid crisis, and reducing prison recidivism rates. What we did not know was that Yuma Representative Don Shooter would be expelled from the House, Debbie Lesko would win the Republican Congressional Primary, and the Legislature would find itself in a tizzy over how to use increased state revenues.
As for AMA, we began the 2018 session with two primary policy goals: protecting the multi-housing industry from harmful regulations and preserving key development incentives for the industry. We believe that we are well on our way to achieving those goals.
This year we placed the majority our focus on two policy areas: The Landlord Tenant Act and Government Property Lease Excise Tax (GPLET).
S.B. 1376: Landlord Tenant Act; Personal Property
We are pleased to report that the AMA’s proactive bill, SB1376, related to abadoned property, has been signed into law by Governor Doug Ducey and will become effective 90 days after the end of the session. Be on the lookout for a member guidance memo.
The bill modifies the Landlord Tenant Act in several ways:
The Government Property Lease Excise Tax (GPLET) is a tax incentive agreement negotiated between a private party and a local government. It was established by the State of Arizona in 1996 as a way to stimulate development in commercial districts by temporarily replacing a building’s property tax with an excise tax. GPLET is levied on property that is owned by a city, town, county or stadium district and leased to a private entity. The tenant, or prime lessee, pays an excise tax based on size and use instead of property tax based on value.
The session kicked off with the introduction of three House bills that would have had a detrimental effect on GPLET. These bills triggered months of tough negotiations between Representative Vince Leach, the AMA, various other development stakeholders and the cities and towns.
After all of the long meetings and difficult phone calls we are happy to say that two bills are dead and an agreement has been reached on H.B.2126. Our amendment to H.B. 2126 will allow the bill reform GPLET while preserving it as the primary development incentive for the State of Arizona.
The bill has passed the full House and is now awaiting committee consideration in the Senate.
The AMA is also monitoring many other bills that have a direct or indirect impact on the apartment industry.
H2263: LANDLORD TENANT; SECURITY DEPOSITS
Summary: If a tenant does not dispute the deductions from a security deposit or the amount due and payable to the tenant within 45 days after termination of the tenancy, the amount due the tenant is final and any further claims are waived.
H2454: SEXUAL ASSAULT; RENTAL AGREEMENT TERMINATION
Summary: A tenant is permitted to terminate a rental agreement if the tenant provides to the landlord written notice that the tenant was the victim, in the tenant’s dwelling, of sexual assault.
HB2568: AFFORDABLE HOUSING TAX CREDIT
Summary: Establishes a credit against individual and corporate income taxes and insurance premium taxes for projects that qualify for the federal low-income housing tax credit and that are placed in service from and after June 30, 2019. The credit is equal to the amount of the federal low-income housing credit for the qualified project. To claim the credit, a taxpayer is required to apply to the Arizona Department of Housing and receive an eligibility statement. If the amount of the credit exceeds taxes due, the taxpayer may carry the unused amount forward for up to five consecutive taxable years.
HB2126: GOVERNMENT PROPERTY; ABATEMENT; SLUM; BLIGHT
Summary: For the purpose of statute allowing municipalities to abate taxes for government property improvements in a single central business district, the definition of “central business district” is modified to require the geographical area to be not larger than the greater of 2.1 percent of the total land area within the exterior boundaries of the municipality or 960 acres, instead of not larger than the greater of 5 percent of the total land area or 640 acres. Modifies the requirements for leases between a prime lessee and a government lessor to require the government lessor to determine that a public benefit to the state and the county or municipality in which the improvement is located will occur because one or more of a list of specified slum or blight-related circumstances exist.
Courtney LeVinus is a principal, and Jake Hinman leads legislative affairs, for Capitol Consulting. They can be reached at 602-712-1121.
Click for the digital version
SUPPORT OUR SPONSORS