First Regular Session H.B. 2213
COMMITTEE ON FINANCE
SENATE AMENDMENTS TO H.B. 2213
(Reference to House engrossed bill)
Page 1, between lines 1 and 2, insert:
"Section 1. Section 42-6202, Arizona Revised Statutes, is amended to read:
42-6202. Commercial government property lease excise tax; database
A. A government lessor shall levy and the county treasurer shall collect an annual excise tax on each prime lessee for the use or occupancy of each government lessor's government property improvement.
B. A government lessor may not own or operate a government property improvement unless one of the following applies:
1. The improvement is subject to the government property lease excise tax under this article with respect to the improvement.
2. The improvement is exempt from tax under section 42‑6208.
3. Tax on the improvement has been abated under section 42‑6209.
C. Within thirty days after entering into a lease for the occupancy of a government property improvement, the government lessor shall:
1. Record a memorandum of lease in the office of the county recorder in the county in which the government property improvement is located. The memorandum of lease must include the basic lease terms, including the names of the parties, the leased property, the lease term, including the beginning and ending dates, and any options to renew the lease or to purchase any of the government property improvement or government owned land.
2. Submit to the county treasurer and the department of revenue copies of the lease or an abstract of the lease.
D. The department of revenue government lessor shall maintain a public database by county, city and town AS APPLICABLE, OR POST ITS LEASE AGREEMENTS ON A COUNTY, CITY OR TOWN WEBSITE WHERE THE GOVERNMENT PROPERTY IMPROVEMENT IS LOCATED, of all government property leases that are subject to the tax under this article.
E. THE GOVERNMENT LESSOR SHALL SUBMIT A CURRENT LINK TO THE PUBLIC DATABASE AS DESCRIBED IN SUBSECTION D OF THIS SECTION TO THE DEPARTMENT OF REVENUE AND NOTIFY THE DEPARTMENT WHEN THE DATABASE NO LONGER CONTAINS ANY ACTIVE LEASES.
F. THE DEPARTMENT OF REVENUE SHALL PLACE LINKS TO ALL OF THE GOVERNMENT LESSORS’ DATABASES WITH ACTIVE LEASES ON THEIR WEBSITE.
E. G. If a county assessor becomes aware of a government property improvement that is or should be subject to the tax under this article, the assessor shall notify the county treasurer and the department of revenue government lessor for confirmation that the improvement is included in their databases database."
Renumber to conform
Page 1, line 12, after "was" strike remainder of line
Strike line 13, insert "determined by the department of revenue to be in compliance with this subsection:"
Page 6, between lines 18 and 19, insert:
"Sec. 4. Section 42-6206, Arizona Revised Statutes, is amended to read:
42-6206. Leases and development agreements; notice of tax liability; approval requirements; default
A. Each lease or development agreement between a prime lessee and a government lessor entered into after June 30, 1996 shall include:
1. A notice of the tax liability under this article.
2. A provision that failure by the prime lessee to pay the tax after notice and an opportunity to cure is an event of default that could result in divesting the prime lessee of any interest in or right of occupancy of the government property improvement.
B. Except as provided by subsection C of this section, each lease or development agreement between a prime lessee and a government lessor for a government property improvement located in a slum or blighted area that is established pursuant to title 36, chapter 12, article 3, that is entered into from and after May 31, 2010 and that does not meet the conditions provided in section 42‑6203, subsection A:
1. Shall not be approved unless the government lessor:
(a) Notifies the governing bodies of the county and any city, town and school district in which the government property improvement is located at least sixty days before the approval. The notice must include the name and address of the intended prime lessee, the location and proposed use of the government property improvement and the proposed term of the lease or development agreement.
(b) Determines that, within the term of the lease or development agreement, the economic and fiscal benefit to this state and the county, city or town in which the government property improvement is located will exceed the benefits received by the prime lessee as a result of the development agreement or lease on the basis of an estimate of those benefits prepared by an independent third party in a manner and method acceptable to the governing body of the government lessor. The estimate must be provided to the government lessor and the governing bodies of the county and any city, town and school district in which the government property improvement is located at least thirty days before the vote of the governing body. A lease or development agreement between a prime lessee and a government lessor involving residential rental housing is exempt from the economic estimate analysis requirements of this subdivision subsection.
2. Must be approved by a simple majority vote of the governing body without the use of a consent calendar.
C. A lease or development agreement that is subject to subsection B of this section must provide that the lease begins within ten years after approval of the development agreement and the term of the lease does not exceed twenty-five years, including any abatement period authorized under section 42‑6209, and regardless of whether the lease is transferred or conveyed to subsequent prime lessees during that period. As soon as reasonably practicable but within twelve months after the expiration date of the lease the government lessor must convey to the current prime lessee title to the government property improvement and underlying land unless the parcel is in an airport subject to federal regulation. Property conveyed to the prime lessee under this subdivision subsection does not qualify for classification as class six property or for any other discounted assessment regardless of the location or condition of the property.
D. Subsections B and C of this section do not apply if the government lessor is acting as a commercial landlord without a development agreement in a lease for a use ancillary to a government property improvement used for a public purpose.
E. No later than June 30 of each year the government lessor shall provide the county assessor with a complete list of development agreements between the government lessor and the prime lessees, including the commencement and termination dates of the agreements, the names and addresses of the prime lessees and the locations of the properties that are subject to the agreements."
Renumber to conform
Page 8, line 22, strike "a" insert "the"; after "body" insert "of the government lessor"
Line 33, after the period insert "THIS SUBSECTION DOES NOT APPLY TO LEASES OR THE DEVELOPMENT AGREEMENTS FOR THE LEASE OF GOVERNMENT PROPERTY IF A CORRESPONDING RESOLUTION OR ORDINANCE OR SUBMITTED REQUEST FOR PROPOSAL FOR THE LEASE OR INTENT TO LEASE SUCH PROPERTY SUBJECT TO THIS SECTION WAS
APPROVED BY THE GOVERNING BODY OF THE GOVERNMENT LESSOR BEFORE JANUARY 1, 2017."
Amend title to conform