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ARIZONA HOUSE OF REPRESENTATIVES57th Legislature, 2nd Regular Session |
House: COM DPA/SE 8-1-1-1 |
HB 2999: municipal improvement districts; technical correction
S/E: infrastructure finance districts
Sponsor: Representative Weninger, LD 13
Caucus & COW
Summary of the Strike-Everything to HB 2999
Overview
Enables the formation of an infrastructure finance district (District).
History
A municipality and a county are authorized to assess development fess to offset costs associated with providing necessary public services to a development, including the costs of infrastructure, improvements, real property, engineering and architectural services, financing and professional services required for the preparation or revision of a development, including the relevant portion of the infrastructure improvements plan (A.R.S. §§ 9-463.05, 11-1102)
Special taxing districts are usually created to fill a need and to enable the provision of services in an area that might otherwise be limited from receiving those services for various reasons, including size, location, financial limitations or unavailability of other government support. The formation of a special taxing district creates a funding stream to pay for the desired or needed services by placing the responsibility on those who benefit from that service.
Title 48 of the Arizona Revised Statutes currently allows and outlines the process for the formation of various types of special taxing districts including fire districts, irrigation districts, hospital districts, pest abatement districts and power districts. Although the specific process depends on the type of district created, the formation in many cases requires the submission of petitions to the county board of supervisors followed by a public hearing. Sometimes an election may be required to form a district.
Provisions
Infrastructure Finance Districts
1. Authorizes individuals and entities having fee-title ownership of all real property in the proposed district to petition the Arizona Finance Authority (Authority) to form a District. (Sec. 3)
2. Detail the contents of the petition. (Sec. 3)
3. Specifies any financial burden of a District and any liability, judgment or claim against a District is the sole responsibility of the District. (Sec. 3)
4. Provides requirements for a filing notice of the petition to the Authority regarding the formation of the District. (Sec. 3)
Infrastructure Finance Districts Formation
5. Declares a District is formed only on the issuance of a formation order by the Authority. (Sec. 3)
6. Instructs the Authority to review the petition to evaluate outlined criteria. (Sec. 3)
7. Instructs the Authority to approve the formation of the District and issue a formation order within 60 days after submission of the petition provided specified requirements are met. (Sec. 3)
8. Outlines the contents of the formation order. (Sec. 3)
9. Limits the Authority's review to confirming that the statutory requirements are satisfied and provides specified factors for petition rejection. (Sec. 3)
10. Provides requirements relating to failure to issue the formation order within 60 days and recording the formation order in the county's real property records. (Sec. 3)
11. Declares the District is a special purpose district, a tax levying public improvement district and a municipal corporation in accordance with constitutional and statutory provisions. (Sec. 3)
12. Instructs the District's board of directors to make a good faith effort to implement the general plan for the public infrastructure of the District. (Sec. 3)
13. Prescribes limitation and requirements relating to fees and other charges assessed by the Authority in connection with the District. (Sec. 3)
Infrastructure Finance Districts Governance
14. Specifies the District is governed by a board of directors consisting of three directors. (Sec. 3)
15. Prescribes the qualifications, terms, responsibilities and vacancies of the board. (Sec. 3)
16. Outlines the records that must be keep and open to public inspection by the board. (Sec. 3)
17. Delineates the powers of the District. (Sec. 3)
18. Prevent a District from exercising land use or zoning authority, and adopting or enforcing zoning ordinances or similar land use regulations. (Sec. 3)
19. Asserts public infrastructure other than personalty may be located only in or on lands owned by this state, a county, a municipality or the district or dedicated or otherwise designated as public roadways, highways, streets, thoroughfares, easements or rights-of-way, whether in or out of the district or a municipality. (Sec. 3)
20. Outlines the contents an agreement may include. (Sec. 3)
21. Declares a person does not have authority to compel the issuance or sale of the bonds of the District or the exercise of any taxing power of the District to make repayment under any agreement. (Sec. 3)
Infrastructure Finance Districts Revenue
22. Specifies the projects to be constructed or acquired as shown in the general plan may be financed from the following sources of revenue:
a. proceeds received from the sale of bonds of the district;
b. monies of a municipality or Indian tribe or community that are contributed to the district;
c. assessments;
d. ad valorem taxes;
e. private contributions;
f. user, landowner and other fees and charges;
g. proceeds of loans or advances; and
h. any other monies available to the district by law. (Sec. 3)
Infrastructure Finance Districts Project Approval
23. Instructs and outlines the requirements for the board of directors to conduct a study of the feasibility and benefits of the project prior to constructing or acquiring any public infrastructure. (Sec. 3)
24. Directs the board of directors to provide outlined information, in addition to the study, to the Authority. (Sec. 3)
25. Requires the Authority to review the information to confirm that all information required has been submitted and that the construction or acquisition of the public infrastructure, complies with the formation order and the general plan and does not otherwise violate District provisions. (Sec. 3)
26. Instructs the Authority to notify the District if the submitted information is incomplete or has not been submitted or if the submitted information indicates that the construction or acquisition of the public infrastructure does not comply with the formation order or the general plan or does not otherwise comply with District provisions. (Sec. 3)
27. Prohibits the board from holding the required public hearing until 30 days has elapsed since the submission of the information and the District has not received from the Authority the prescribed notice. (Sec. 3)
28. Limits fees and other charges assessed in connection with the review of the submitted information to $15,000 per submission. (Sec. 3)
Infrastructure Finance Districts Tax
29. Prescribes the limitations regarding the total aggregate outstanding amount of bonds and the ad valorem tax rate levied to pay the debt service on all general obligation bonds. (Sec. 3)
30. Authorizes the board to call a general obligation bond election for providing monies for any public infrastructure purposes consistent with the general plan. (Sec. 3)
31. Prescribes requirements for bond issuance and bond refunds. (Sec. 3)
32. Specifies all bonds are secured by a lien on all revenues received in accordance with the ad valorem tax levy and provides stipulations for the lien. (Sec. 3)
Infrastructure Finance Districts Assessment
33. Authorizes the board to levy an assessment of the costs of any public infrastructure purpose or any operation and maintenance of public infrastructure on any land in the District that is based on the benefit determined by the board to be received by the land. (Sec. 3)
34. Outlines requirements for issuing assessment bonds. (Sec. 3)
35. Allows the board to issue and sell assessment bonds, after the adoption of a resolution levying an assessment on property in the District. (Sec. 3)
36. Provides requirements for collection of the assessment and delinquent assessments by the county treasurer. (Sec. 3)
37. Allows the District to issue and sell refunding bonds to refund any assessment bonds of the District. (Sec. 3)
Infrastructure Finance Districts Revenue Bonds
38. Authorizes the board to issue revenue bonds to provide monies for any infrastructure purposes consistent with the general plan. (Sec. 3)
39. Requires the District to prescribe fees and charges to generate revenue sufficient to pay when due the principal and interest of all revenue bonds for the payment of which revenue has been pledged which are to be identified with the annual budget process of the district. (Sec. 3)
40. Outlines restrictions and limitations for revenue bonds. (Sec. 3)
41. Allows the District to issue and sell refunding bonds to refund any revenue bonds of the District. (Sec. 3)
42. Prescribes requirements for the term, denomination, interest rates, selling of bonds and use. (Sec. 3)
Infrastructure Finance Districts O/M Tax
43. Allows the board to call an election to authorize the board to levy an O/M tax on the net limited assessed property valuation of property in the District. (Sec. 3)
44. Outlines the requirements for levying the O/M tax, include the tax rate. (Sec. 3)
Infrastructure Finance Districts Budgets
45. Instructs the treasurer to prepare a proposed budget for the ensuing fiscal year to be submitted to the board for approval. (Sec. 3)
46. Requires the board to indicate its approval of the budget by resolution, which shall provide for a hearing on the budget as approved. (Sec. 3)
47. Allows entities to review and submit comments for its assistance and information in adopting the annual budget. (Sec. 3)
48. Requires the board to adopt a budget before October 1 each year. (Sec. 3)
District Dissolution
49. Requires a District that does not have any outstanding bonds or other obligations to be dissolved 10 years after the date of formation, unless the Authority by resolution extends the District by an additional period of 10 years. (Sec. 3)
50. Outlines the conditions for the Board to dissolve a District. (Sec. 3)
51. Requires the Authority to approve the dissolution provided the outlined conditions are met. (Sec. 3)
52. Subjects all property in the District to the lien for payment of ad valorem taxes levied and to an assessment lien. (Sec. 3)
53. Includes additional conditions for dissolution relating to outstanding bonds. (Sec. 3)
Miscellaneous
54. Prescribes District requirements relating to:
a. displaying ad valorem tax or assessment tax on each property tax bill;
b. notice and conducting any election;
c. recording documents with the county recorder;
d. establishing and maintaining an official website;
e. annual reporting;
f. seller disclosures;
g. changes in District boundaries or general plan; and
h. district improvements. (Sec. 3)
55. Define pertinent terms. (Sec. 3)
56. Includes, to the municipal and county schedule for payment of development fees, the costs identified in the infrastructure improvement plan applicable to a community facilities district or an infrastructure finance district. (Sec. 1, 2)
57. Cites this act as the State Housing Affordability District Act. (Sec. 4)
Amendments
Committee on Commerce
1. Includes the monies collected from the state housing affordability district special assessment fee to the taxpayers' information fund.
2. Authorizes a county treasurer to impose and collect a fee for expenses related to the collection of special assessments for a state housing affordability district.
3. Changes the District's name to the State Housing Affordability Districts.
4. Modifies and includes various definitions.
5. Clarifies the noncontiguous property of the District.
6. Modifies the information content in the petition for formation of a District.
7. Adds all certifications, determinations, actions required to be made by the Authority must be made by the executive Director.
8. Includes a fee cap for filing an application and petition to form a district.
9. Modifies the criteria for rejecting a petition.
10. Adds that the owners of at least 50% of the land in the district may petition to amend the formation order to modify the powers or financial parameters of the District.
11. Provides requirements for review of a petition to amend the formation order.
12. Includes additional conditions for resignation of a director from the board and requirements for vacancies.
13. Modifies the information the board must send to the Authority, which is in addition to the study of the feasibility and benefits of the project.
14. Increases the term of bonds to 30 years.
15. Includes a legislative findings clause.
16. Makes clarifying changes.
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20. Initials HB 2999
21. 2/15/2026 Page 0 Caucus & COW
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