2017 Legislative Update

In mid-July, a number of new bills affecting Arizona landlords and tenants became law.

1. Eviction forms

HB2237 prohibits the courts from adopting standardized forms and notices that landlords and tenants must use in an eviction proceeding.  If the forms and notices used meet statutory requirements, the court cannot reject them.

2. Real estate brokers acting as mobile home dealers

HB2072 permits licensed real estate brokers to act as dealers in the sale of mobile homes located in mobile home parks.

3. Towing abandoned resident vehicles

HB2159 prohibits the towing of vehicles parked by residents in areas set aside by the landlord as designated parking spots unless there is evidence the vehicle has been abandoned.  Lapsed registration may be considered evidence of abandonment, but that alone is not enough to fully determine if the vehicle has been abandoned.

4. Apartment finders fees

HB2039 makes changes to the law controlling finders fees for tenants who refer new residents to an apartment complex.  The finders fee was capped at $200 per referral and limited the number of times per year a landlord could issue the credit.   There is also no longer any limit to the number of referrals any single tenant can make in a calendar year or the amount of rent credit a landlord can issue, but the referral fee must be paid as a rent credit to the tenant’s account and not in any other form.  This law only applies to tenants at the apartment providing the finders fee.  Leasing agents and managers are still prohibited from receiving a finder fee, though the law does not prohibit them from receiving a bonus pursuant to A.R.S. 32-2121.  Further, tenants are still restricted from 1) showing rental units to a prospective new lessee, 2) discussing terms or conditions of leasing an apartment, and 3) participating in negotiating a lease of the unit.  Finally, a potential finder fee recipient under this section is still prohibited from advertising or promoting her ability to help new renters find units to lease.

The remainder of the law works the same as before the amendments.  Keep in mind that a violation of the finders fee statute may result in suspension or revocation of professional license or the imposition of a civil penalty.  Also, do not forget that 1099 tax forms are required for any tenant receiving over $600 in finders fees.  

5. Americans with Disability Act

SB1406 modifies the litigation process for parties filing suit under the Arizona Americans with Disability Act (Arizona ADA).  Parties filing suit under the Arizona ADA must now give private party defendants notice of the supposed violation and 30 days to correct the violation before filing suit unless a building permit is required.  If a building permit is required, then the private party defendant subject to the claim must submit a corrective action plan to the aggrieved party and apply for a building permit within 30 days.

6. Short term rentals

SB1350 prohibits cities, towns, or counties from banning or restricting vacation rentals or short-term rentals except for public health and safety reasons.  It also allows taxing entities to more efficiently collect a transaction privilege tax on such rentals.  This law does not include HOA’s or other private entities.

7. Dog breed regulation

SB1248 permits cities and towns to regulate the control of dogs as long as the regulation is not breed specific.  Unless an apartment complex is owned by a city or town, this law should not affect the apartment industry because it does not apply to private entities.

8. Interest rate

The legal interest rate on judgments is now 5.25%.