Senate Engrossed

 

 

 

 

State of Arizona

Senate

Forty-eighth Legislature

First Regular Session

2007

 

 

SENATE BILL 1291

 

 

 

AN ACT

 

amending sections 32-3601, 32-3602, 32-3603, 32-3604, 32-3605, 32-3607 and 32-3608, Arizona Revised Statutes; amending title 32, chapter 36, article 1, Arizona Revised Statutes, by adding section 32-3609; amending sections 32‑3611, 32-3614, 32-3615, 32-3617, 32-3618, 32-3619, 32-3621, 32-3622, 32‑3625 and 32-3626, Arizona Revised Statutes; amending title 32, chapter 36, article 2, Arizona Revised Statutes, by adding sections 32-3627 and 32-3628; amending sections 32-3631, 32-3636, 32-3652 and 32-3654, Arizona Revised Statutes; amending title 32, chapter 36, article 4, Arizona Revised Statutes, by adding section 32-3656; amending sections 43-1089.02 and 43-1181, Arizona Revised Statutes; relating to the state board of appraisal.

 

 

(TEXT OF BILL BEGINS ON NEXT PAGE)

 



Be it enacted by the Legislature of the State of Arizona:

Section 1.  Section 32-3601, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3601.  Definitions

In this chapter, unless the context otherwise requires:

1.  "Appraisal" or "real estate appraisal" means a statement independently and impartially prepared by an individual setting forth an opinion as to the market value of real property as of a specific date and supported by the presentation and analysis of relevant market information any of the following:

(a)  the act or process of developing an opinion of value.

(b)  An opinion of value.

(c)  Pertaining to appraising and related functions such as appraisal practice or appraisal services.

2.  "Appraisal assignment" means an engagement for which a real estate appraiser is employed or retained to act, or would be perceived by third parties or the public in acting, as a disinterested third party in rendering an unbiased analysis, opinion or conclusion relating to the nature, quality, value or utility of specified interests in or aspects of identified real estate.

3.  "Appraisal foundation" means the appraisal foundation incorporated as an Illinois not‑for‑profit corporation on November 30, 1987.

4.  "Appraisal report" means any communication, written or oral, of an appraisal.

5.  "Appraisal review" means the act of reviewing or the report that follows a review of an appraisal assignment or appraisal report in which a real estate appraiser forms an opinion as to the adequacy and appropriateness of the report being reviewed.

6.  "Appraisal standards board" means the appraisal standards board appointed by the board of trustees of the appraisal foundation to develop, interpret and amend the uniform standards of professional appraisal practice.

6.  7.  "Appraisal subcommittee" means the subcommittee of the federal financial institutions examination council created pursuant to 12 United States Code section 3310 and chapter 34A, as amended.

7.  8.  "Appraiser qualifications board" means the appraiser qualifications board appointed by the board of trustees of the appraisal foundation to establish the minimum education, experience and examination requirements for real estate appraisers.

8.  9.  "Board" means the state board of appraisal.

9.  "Certified appraisal" or "certified appraisal report" means an appraisal or appraisal report given or signed and certified as such by a state certified appraiser.

10.  "Complex one to four residential units" means property that is atypical for the marketplace.  Atypical factors may include architectural style, age of improvements, size of improvements, size of lot, neighborhood land use, potential environmental hazard liability, leasehold interests, limited readily available comparable sales data or other unusual factors.

11.  "Course review approval" means the act of the board reviewing course materials to form an opinion as to the adequacy and appropriateness of the course for licensing pursuant to section 32-3613, certification pursuant to section 32-3614 and continuing education as prescribed in section 32‑3625 in accordance with the appraiser qualifications board and this chapter.

12.  "Federal financial institutions examination council" means that agency of the federal government created pursuant to 12 United States Code chapters 34 and 34A, as amended.

13.  "Federally related transaction" means any real estate related financial transaction that a federal financial institution's regulatory agency or the resolution trust corporation engages in, contracts for or regulates and that requires an appraisal.

14.  "Licensed appraisal" or "licensed appraisal report" means an appraisal or appraisal report given or signed by a state licensed appraiser.

15.  14.  "Property tax agent" means an individual who is designated by a person or is an employee of an entity designated as an agent pursuant to section 42‑16001, who acts on behalf of a person who owns, controls or possesses property valued by a county assessor and who receives a fee for the analysis of any matter relating to the review of the valuation of the person's property before the assessor.  Property tax agent does not include a person who is admitted to practice law in this state, an employee of the person owning, controlling or possessing the property or an employee of an entity designated pursuant to section 42‑16001, if the employee is performing a secretarial, clerical or administrative support function.

16.  15.  "Real estate" means an identified parcel or tract of land, including improvements, if any.

17.  16.  "Real estate related financial transaction" means any transaction involving the sale, lease, purchase, investment in or exchange of real property, including interests in property or the financing of property, the refinancing of real property or interests in real property and the use of real property or interests in property as security for a loan or investment including mortgage‑backed securities.

18.  17.  "Real property" means one or more defined interests, benefits and rights inherent in the ownership of real estate.

19.  18.  "Review appraiser" means a person who engages in the activity of reviewing and evaluating the appraisal work of others from the perspective of an appraiser, generally for compensation as a separate skill.  This includes the function of reviewing an appraisal report or a file memorandum setting forth the results of the review process.

20.  19.  "Standards of professional appraisal practice" means the uniform standards of professional appraisal practice adopted by the board.

21.  20.  "State licensed or state certified appraiser" means a person who develops and communicates appraisals and who holds a current, valid license or certificate issued to him under the provisions of this chapter.

22.  "Valuation" means an estimate of the value of property.

21.  "Value" means the monetary relationship between properties and those who buy, sell or use those properties. END_STATUTE

Sec. 2.  Section 32-3602, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3602.  Applicability of chapter

This chapter does not apply to:

1.  A real estate broker or salesperson who is licensed in this state and who, when acting as such, gives an opinion as to the price of real estate for the purpose of prospective listing or sale if this opinion is not referred to as an appraisal.

2.  A natural person, a corporation through its officers or a partnership through its partners that deals in gives an opinion of value of that person's or its own property and does not receive special compensation for the transaction if this opinion is not referred to as an appraisal.

3.  An attorney in the performance of that person's duties as an attorney.

4.  A mortgage banker, mortgage broker or commercial mortgage banker who is licensed in this state and who, when acting as such, prepares a report analyzing real property if the report is not made for the primary purpose of establishing the sale or market value of the property.

5.  An individual who is otherwise subject to licensing or certification by law and whose duties require appraisal of real property for purposes of tax assessment.

6.  A professional An engineer or architect registered in this state or a contractor or insurance producer licensed in this state who, when acting as such, prepares a report analyzing real property if the report utilizes the specialized knowledge of the registered professional engineer or architect or the licensed contractor or insurance producer.

7.  A property tax agent who is registered in this state and who, when acting as such, prepares a report analyzing real estate if the report is made for purposes of tax assessment or tax valuation of the real estate.

8.  An individual appraising real property only for the purpose of providing an opinion of value in a judicial proceeding or an individual providing an opinion in a judicial proceeding.  An individual providing an opinion under the exemption of this paragraph shall not represent or imply in any report or testimony that the individual testifying is licensed or certified under this chapter.  This paragraph does not apply to a person who is licensed or certified pursuant to this chapter. END_STATUTE

Sec. 3.  Section 32-3603, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3603.  License or certificate use; exception

A.  All real estate appraisals and appraisal reviews performed on real property in this state shall be performed only by individuals licensed or certified in accordance with the requirements of this chapter.  No person, other than a state licensed or state certified appraiser, may assume or use that title or any title, designation or abbreviation likely to create the impression of licensure or certification as an appraiser by this state.

B.  No person other than a state licensed or state certified appraiser may receive a fee for a real estate appraisal or an appraisal review of real property in this state. END_STATUTE

Sec. 4.  Section 32-3604, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3604.  State board of appraisal

A.  A state board of appraisal is established and is composed of nine members who are appointed by the governor pursuant to section 38‑211.

B.  The membership of the board consists of:

1.  Four Five members who are state certified or state licensed appraisers under this chapter, one two of whom is a are state certified general appraiser, one appraisers, two of whom is a are state certified residential appraiser, one of whom is a state licensed appraiser appraisers and one of whom is any state certified or state licensed appraiser. Membership in a professional appraisal organization or association is not a prerequisite to service on the board.

2.  Three Two public members who are not related within the third degree of consanguinity or affinity to any real estate appraiser.

3.  A registered property tax agent.

4.  One member, who is not a certified or licensed appraiser, who is employed by a lending institution that purchases or makes use of either commercial or residential appraisals and whose position of employment relates to the use of appraisals by that institution.

C.  Members shall serve for staggered terms of three years.

D.  No person may serve as a member of the board for more than two consecutive terms.  Not more than two persons from the same professional appraisal organization or association may serve on the board concurrently. The governor may remove a member for cause.  No person may serve as a member of the board for more than two consecutive terms unless both of the following apply:

1.  The person is appointed to serve the remainder of some other board member's term of office after that board member's seat is declared vacant.

2.  The person's service for the remainder of the vacated term does not exceed eighteen months.

E.  The public members of the board shall not be engaged in the practice of appraising or be the owner or employee of any proprietary business involving appraisal education or testing of appraisers.

F.  The board shall meet at least once each calendar quarter to conduct business.  Places of future meetings shall be decided by the vote of members at meetings.  By order of the chairman and if necessary to meet the requirements of this chapter, the board may hold special meetings or emergency meetings including meetings using conference telephone or other similar communications equipment in such a manner that the voices of all members participating in the meeting are simultaneously audible to all other members participating in the meeting.

G.  The board shall meet to elect a chairman annually from among its members.

H.  A majority of the members constitutes a quorum.

I.  Each member of the board is eligible to receive compensation not to exceed one hundred fifty dollars for each day or seventy‑five dollars for each part of a day consisting of less than four hours actually spent in the conduct of the business of the board, plus reimbursement for all expenses pursuant to title 38, chapter 4, article 2.

J.  The auditor general shall conduct a performance audit or a special audit of the board pursuant to section 41‑1279.03 on or before December 31, 2004 and at least once every ten years thereafter.  The auditor general shall also conduct performance audits or special audits of the board when directed to do so by the joint legislative audit committee. END_STATUTE

Sec. 5.  Section 32-3605, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3605.  State board of appraisal; duties

A.  The board shall adopt rules in aid or in furtherance of this chapter.

B.  The state board of appraisal shall:

1.  In prescribing standards of professional appraisal practice, adopt standards that at a minimum are equal to the standards prescribed by the appraiser qualifications board appraisal standards board.

2.  In prescribing criteria for certification, adopt criteria that at a minimum are equal to the minimum criteria for certification adopted by the appraisal subcommittee appraiser qualifications board.

3.  In prescribing criteria for licensing, adopt criteria that at a minimum are equal to the minimum criteria for licensing adopted by the appraisal subcommittee appraiser qualifications board.

4.  Further define by rule with respect to state licensed or state certified appraisers appropriate and reasonable educational experience, appraisal experience and equivalent experience that meets the statutory requirement of this chapter.

5.  Establish the examination specifications for state certified appraisers, provide or procure appropriate examination questions and answers, administer examinations and establish procedures for grading examinations consistent with and equivalent to the criteria adopted by the appraisal subcommittee appraiser qualifications board.

6.  Establish the examination specifications for state licensed appraisers, provide or procure appropriate examination questions and answers, administer examinations and establish procedures for grading examinations consistent with and equivalent to the criteria adopted by the appraisal subcommittee appraiser qualifications board.

7.  Establish administrative procedures for approving or disapproving applications for licensure and certification and issuing licenses and certificates.

8.  Define by rule, with respect to state licensed and certified appraisers, the continuing education requirements for the renewal of licenses or certificates that satisfy the statutory requirements provided in this chapter.

9.  Periodically review the requirements for the development and communication of appraisals provided in this chapter and adopt rules explaining and interpreting the requirements.

10.   Define and explain by rule each stage and step associated with the administrative procedures for the disciplinary process pursuant to this chapter including:

(a)  Prescribing minimum criteria for accepting a complaint against a licensed or certified appraiser.

(b)  Defining the process and procedures used in investigating the allegations of the complaint.

(c)  Defining the process and procedures used in hearings on the complaint, including a description of the rights of the board and any person who is alleged to have committed the violation.

(d)  Establishing criteria to be used in determining the appropriate actions for violations.

11.  Communicate information that is useful to the public and appraisers relating to actions for violations.

12.  Censure, suspend, and revoke or deny licenses and certificates pursuant to the disciplinary proceedings provided for in section 32‑3631.

13.  At least monthly transmit to the appraisal subcommittee a roster listing individuals who have received a state certificate or license in accordance with this chapter.

14.  Report on the disposition of any matter referred by the appraisal subcommittee or any other federal agency or instrumentality or federally recognized entity reporting any action of a state licensed or state certified appraiser that is contrary to this chapter.

15.  14.  Make a determination and finding if there exists a scarcity of state certified or state licensed appraisers to perform appraisals in connection with federally related transactions in this state and issue resident temporary licenses and certificates pursuant to section 32‑3626.

16.  15.  Transmit the annual national registry fee collected pursuant to section 32‑3607 to the federal financial institutions examination council appraisal subcommittee.

17.  16.  Establish the fees in accordance with the limits established in section 32‑3607.

18.  17.  Perform such other functions and duties as may be necessary to carry out this chapter.

C.  The board may employ an executive director and other personnel and designate their duties.  The executive director shall serve at the pleasure of the board.

D.  The executive director shall not change or amend actions of the board. END_STATUTE

Sec. 6.  Section 32-3607, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3607.  Fees

A.  The board shall charge and collect fees that are sufficient to fund the activities necessary to carry out this chapter.  These include:

1.  An application fee for licensure or certification of not more than four hundred dollars.

2.  An application fee for a resident temporary license or certificate of not more than four hundred dollars.

3.  An examination fee of not more than one hundred dollars.

4.  A reexamination fee, not more than one hundred dollars.

5.  4.  A fee for renewal of a license, certificate or resident temporary license or certificate of not more than four hundred twenty‑five dollars.

6.  5.  A delinquent renewal fee in addition to the renewal fee of not more than twenty‑five dollars the fee for renewal of a license or certificate.

6.  A late renewal application fee in addition to the renewal fee of not more than one hundred fifty dollars.

7.  A two year federal national registry fee of not to exceed the actual cost of twice the current annual federal national registry fee.

8.  A nonresident temporary license or certification fee of not more than one hundred fifty dollars.

9.  A fee for an extension to renew a license or certification of not more than six months, not more than twenty dollars.

9.  A fee for an inactive license or certificate of not more than one hundred fifty dollars.

10.  A fee to reactivate an inactive license or certificate of not more than one hundred fifty dollars.

10.  11.  A course review approval fee of not more than five hundred dollars.

12.  A fee to change an instructor for a course already approved by the board of not more than fifty dollars.

13.  A fee for a duplicate license or certificate of not more than thirty-five dollars.

14.  A fee for a letter of good standing or a history letter of not more than thirty-five dollars.

B.  If the appraisal subcommittee raises the federal national registry fee during the second year of a biennial license or certificate, state licensed and state certified appraisers shall pay the additional federal national registry fee on demand by the board.  Failure to pay the additional fee within thirty days of notice by the board subjects the licensee license or certificate holder to a penalty of twice the amount owed but not to exceed twenty dollars.  The board shall not renew a license or certificate until all outstanding obligations of the licensee license or certificate holder are paid. END_STATUTE

Sec. 7.  Section 32-3608, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3608.  Board of appraisal fund

A.  A board of appraisal fund is established.  Except as provided in subsection C of this section, pursuant to sections 35‑146 and 35‑147, the board shall deposit ten per cent of the monies in the state general fund and deposit the remaining ninety per cent in the board of appraisal fund.

B.  Except as provided in subsection C of this section, all monies deposited in the board of appraisal fund are subject to section 35‑143.01.

C.  The federal national registry fee collected pursuant to section 32‑3607, subsection A, paragraph 7 shall be deposited in the board of appraisal fund pending transmittal to the federal financial institutions examination council on direction by the board appraisal subcommittee.  These monies are not subject to section 35‑143.01.  END_STATUTE

Sec. 8.  Title 32, chapter 36, article 1, Arizona Revised Statutes, is amended by adding section 32-3609, to read:

START_STATUTE32-3609.  Confidential records

Except as otherwise provided by law, the following records are confidential:

1.  Questions contained in any examination administered by or for the board or in any examination submitted to the board for course approval.

2.  Questions asked and the answers of individual examinees, except that the board shall provide the grades of each examinee for public inspection and copying.

3.  Appraisal reports or appraisal reviews and supporting documentation deemed confidential under the uniform standards of professional appraisal practice edition adopted by the board.

4.  All documents associated with a complaint until the complaint is resolved. END_STATUTE

Sec. 9.  Section 32-3611, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3611.  Licensure and certification process

A.  Applications for original licensure or certification, renewals and examinations shall be made in writing to the executive director on forms approved by the board.

B.  Appropriate fees, as fixed by the board pursuant to section 32‑3607, shall accompany all applications for original licensure or certification, renewal and examination.

C.  At the time of filing an application for licensure or certification, each applicant shall sign a pledge to comply with the standards set forth in this chapter and shall state that he the applicant understands the types of misconduct for which disciplinary proceedings may be initiated against a state licensed or state certified appraiser, as set forth in this chapter.

D.  Except as otherwise provided in this chapter, the executive director shall require such other proof and request such documents, through the application or otherwise, as the board deems necessary for the interests of the public and to verify the honesty, truthfulness, reputation and competency of the applicant and shall require that the applicant for licensure or certification:

1.  Be at least eighteen years of age and a citizen of the United States or a qualified alien as defined in 8 United States Code section 1641 legal resident alien.

2.  Shall not have had a license or certificate denied pursuant to this chapter within one year immediately preceding the application.

3.  Shall not have had a license or certificate revoked pursuant to this chapter within two years immediately preceding the application.

4.  State whether or not he the applicant has ever been convicted in a court of competent jurisdiction in this or any other state of a felony or of forgery, theft, extortion or conspiracy to defraud or any other offense crime involving dishonesty or moral turpitude.

E.  Applications for licensure or certification by persons who are charged or under indictment for fraud involving appraisal of real property may be denied pending final disposition of the charge or indictment.  Upon final disposition, the board shall review the proceedings and act upon the application. END_STATUTE

Sec. 10.  Section 32-3614, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3614.  Application and qualification requirements for certification

A.  An application for certification and examination shall be made on forms prescribed by the board and accompanied by the required fees.

B.  Those persons filing for certification shall meet the minimum criteria for certification established by the board under section 32‑3605, subsection B, paragraph 2 and section 32‑3615.

C.  No person may be a state certified real estate appraiser unless the person has achieved a passing grade on a suitable examination administered by the board.

D.  Persons presenting evidence showing successful completion of the requirements of this section shall be recognized as having met the qualifications as a state certified real estate appraiser. END_STATUTE

Sec. 11.  Section 32-3615, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3615.  Experience requirement for licensure or certification

A.  An original certificate as a state certified real estate appraiser shall not be issued to any person who does not possess either:

1.  Two years of experience as an appraiser in real estate appraisal supported by adequate written reports or filed memoranda.  This experience shall have been acquired during any period within five years immediately preceding the filing of the application for certification.

2.  Four years of experience as an appraiser in real estate appraisal supported by adequate written reports or filed memoranda.  This experience shall have been acquired during any period within ten years immediately preceding the filing of the application for certification.

A.  Each applicant for licensure or certification shall have experience that was acquired within ten years immediately preceding the filing of the application for licensure or certification.

B.  Each applicant for licensure or certification shall furnish under oath a detailed listing of the real estate or other appraisal reports, review reports or filed memoranda for each year for which experience is claimed by the applicant.  On request, the applicant shall make available to the board for examination copies of appraisal reports which the applicant has prepared in the course of his the applicant's appraisal practice experience. END_STATUTE

Sec. 12.  Section 32-3617, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3617.  Nonresident temporary licensure or certification

A.  Every applicant for nonresident temporary licensure or certification under this chapter who is not a resident of this state shall submit, with the application for nonresident temporary licensure or certification, an irrevocable consent that service of process on the applicant may be made by delivery of the process to the secretary of state if, in an action against the applicant in a court of this state arising out of the applicant's activities as a nonresident temporary state licensed or state certified appraiser, the plaintiff cannot effect, in the exercise of due diligence, personal service on the applicant.

B.  A nonresident of this state who has complied with subsection A may obtain a nonresident temporary license or certificate as a nonresident temporary state licensed or state certified appraiser by conforming to all of the requirements of this chapter relating to state licensed or state certified appraisers.

C.  A nonresident of this state who is licensed or certified in another state is entitled to nonresident temporary license licensure or certification from the board, which shall be valid until the completion of each appraisal assignment but not for a period of more than one year from the date of issuance, if:

1.  The properties to be appraised are federally related.

2.  The nonresident appraiser's business in this state is of a temporary nature.

3.  The nonresident appraiser applies with the board on forms prepared by the board.

4.  The nonresident appraiser pays the nonresident temporary license licensure or certification fee required by the board. END_STATUTE

Sec. 13.  Section 32-3618, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3618.  Nonresident licensure or certification by reciprocity

If, in the determination of the board, another state is deemed to have substantially equivalent licensing and or certification requirements and the board has entered into a reciprocity agreement with that state, an applicant who is licensed or certified under the laws of the other state may obtain a license or certificate as a state licensed or state certified appraiser in this state on such terms and conditions as may be determined by the board. END_STATUTE

Sec. 14.  Section 32-3619, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3619.  Renewal of license or certificate; fees; military duty exception

A.  Except as otherwise provided in this section, to renew a license or certificate as a state licensed or state certified appraiser, the holder of a current, valid license or certificate shall make an application and pay the prescribed fee to the board not earlier than one hundred twenty ninety days nor later than thirty days before the expiration date of the license or certificate then held.  With the application for renewal, the state licensed or state certified appraiser shall present evidence in the form prescribed by the board of having completed the continuing education requirements for renewal specified in section 32‑3625.  The renewal application shall be mailed to the last known address of record not more than ninety days nor less than sixty days before the renewal date.

B.  If the board determines that an applicant has failed to meet the requirements for renewal of a license or certificate through mistake, misunderstanding or circumstances beyond the control of the applicant, the board may extend the term of the license or certificate for a period of not more than six months, on payment by the applicant of a prescribed fee for the extension.

C.  At the time of the first renewal, the licensee shall have fully completed the requirements of section 32‑3613, subsection C and section 32‑3625, subsection A.

D.  If the applicant satisfies the requirements for renewal during the extended term of licensure or certification, the beginning date of the renewal license or certificate is the day after the expiration of the license or certificate previously held by the applicant.

E.  If a person fails to renew a license or certificate as a state licensed or state certified appraiser before its expiration or within a period of extension granted by the board pursuant to this chapter, the person may obtain a renewal license or certificate by satisfying all of the requirements for renewal and by the payment of a late renewal fee.

B.  The board may accept a Renewal application less than thirty days before the expiration date of the license or certificate but shall assess a late renewal application fee in addition to the renewal fee.

C.  The board may accept a renewal application after the expiration date and within ninety days of the date of expiration but shall assess a delinquent renewal fee in addition to the renewal fee.

D.  A person deployed outside of the United States on active military duty with the United States armed forces and whose license or certificate has expired during such active military duty outside of the United States may file a renewal application within one hundred eighty days of returning home from active military duty and shall not be required to pay a late renewal application fee or a delinquent renewal fee.  Evidence of the renewal applicant's dates and locations of deployment must be submitted with a renewal application filed under this subsection.  In addition, the renewal applicant must provide evidence of completion of the continuing education requirements for which the renewal applicant would have otherwise been required to meet during the period preceding the renewal application.

E.  An appraiser who fails to seek renewal within the time period specified in subsection A, B, C or D of this section must reapply for licensure or certification and meet all of the requirements of this chapter.

F.  An appraiser shall not engage in, advertise or purport to engage in real estate APPRAISAL activity in this state after a license or certificate has expired and before the renewal of the expired license or certificate.

G.  The board may deny a renewal application on any of the grounds prescribed in this chapter for the denial of any application for licensure or certification.

H.  Notwithstanding section 41-1092.11, a license or certificate expires on its expiration date.END_STATUTE

Sec. 15.  Section 32-3621, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3621.  Principal place of business

A.  Each state licensed or state certified appraiser shall advise the board of the address of his the appraiser's principal place of business and all other addresses at which he the appraiser is currently engaged in the business of preparing real property appraisal reports.

B.  If a state licensed or state certified appraiser changes a place of business, he shall give written notification within ten days of the change to the board and shall apply for an amended license or certificate.

C.  B.  Every state licensed or state certified appraiser shall notify the board of his the appraiser's current residence address.  Residence addresses on file with the board are exempt from disclosure as public records.

C.  Every state licensed or state certified appraiser shall provide a daytime telephone number to the board.

D.  If a state licensed or state certified appraiser changes a place of business or residence or the appraiser's daytime telephone number, the appraiser shall give written notification of the change within ten days after the change to the board. END_STATUTE

Sec. 16.  Section 32-3622, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3622.  Licenses and certificates

A.  A license or certificate issued under this chapter shall bear the signatures or facsimile signatures of the members be signed on behalf of the board and shall bear the license or certificate number assigned by the board.

B.  Each state licensed or state certified appraiser shall place his the appraiser's license or certificate number adjacent to or immediately below the title "state licensed appraiser" or "state certified appraiser" and the number shall be included in an appraisal report or in a contract or other instrument used by the license or certificate holder in conducting appraisal activities. END_STATUTE

Sec. 17.  Section 32-3625, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3625.  Continuing education

A.  As a prerequisite to renewal of a license or certificate, a state licensed or state certified appraiser shall present evidence satisfactory to the board of having met the continuing education requirements of either subsection B or C.

B.  The basic continuing education requirement for renewal of a license or certificate is the completion by the applicant, during the immediately preceding term of the license or certificate, of courses or seminars which are approved by the board.

C.  An applicant for relicensing or recertification may satisfy all or part of the continuing education requirements by presenting evidence of the following which shall be approved by the board:

1.  Completion of an education program of study determined by the board to be equivalent, for continuing education purposes, to courses approved by the board pursuant to subsection B.

2.  Participation other than as a student in educational processes and programs which are approved by the board and which relate to appropriate appraisal theory, practices or techniques, including teaching, program development and preparation of textbooks, monographs, articles and other instructional materials, not to exceed fifty per cent of an applicant's continuing education requirements and not for the same course in consecutive renewal periods.

D.  The board shall adopt rules to assure that persons renewing their licenses or certificates as state licensed or state certified appraisers follow practices and techniques which provide a high degree of service and protection to those members of the public with whom they deal in the professional relationship under the authority of the license or certificate. The rules shall include the following:

1.  Policies and procedures for obtaining board approval of courses and instruction pursuant to subsection B.

2.  Standards, policies and procedures to be applied by the board in evaluating an applicant's claims of equivalency in accordance with subsection C.

3.  Standards, monitoring methods and systems for recording attendance to be employed by course sponsors as a prerequisite to board approval of courses for credit.

E.  In adopting rules pursuant to subsection D, paragraph 1, the board shall give consideration to courses of instruction, seminars and other appropriate appraisal educational courses or programs previously or hereafter developed by or under the auspices of professional appraisal organizations and utilized by those associations for purposes of designation, or indicating compliance with the continuing education requirements of such organizations. No person who offers these courses may discriminate in the opportunity to participate in these courses on the basis of membership or nonmembership in an appraisal organization.

F.  No amendment or repeal of a rule adopted by the board pursuant to this section may operate to deprive a state licensed or state certified appraiser of credit toward renewal of a license or certificate for any course of instruction either completed by the applicant or enrolled in by the applicant before the amendment or repeal of the rule which would have qualified for continuing education credit under the rule as it existed before the repeal or amendment.

G.  A license or certificate as a state licensed or state certified appraiser that has been revoked as a result of disciplinary action by the board shall not be reinstated unless the applicant presents evidence of completion of the continuing education required by this chapter.  This requirement of evidence of continuing education shall not be imposed on an applicant for reinstatement who has been required to successfully complete the examination for state licensed or state certified appraiser as a condition of reinstatement of a license or certificate. END_STATUTE

Sec. 18.  Section 32-3626, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3626.  Scarcity determination; resident temporary licenses and certificates; exemption

A.  No later than November 1 of each year, the board shall determine and make a finding whether there is a scarcity of state certified or state licensed appraisers in an area within the state to perform appraisals in federally related transactions.

B.  In determining whether a scarcity exists, the board shall follow procedures in accordance with the provisions governing scarcity in 12 United States Code section 3348 and regulations adopted pursuant to that section as of September 30, 1992.

C.  If the board makes a finding of scarcity, within fifteen days after the finding, the board shall apply to the appropriate federal agency for a temporary waiver of the state certification or licensing requirements.

D.  If a waiver request has been approved by the federal agency authorized to issue waivers, the board may thereafter issue resident temporary licenses or certificates to applicants consistent with the reduction in application requirements of this chapter for licenses and certificates as authorized by the waiver.  A resident temporary license or certificate shall be subject to all provisions of this chapter not inconsistent with the provisions of the waiver.

E.  A person obtaining a resident temporary license or certificate under this section is required to comply with all of the provisions of this chapter except for those provisions of this chapter for which a temporary waiver has been approved and shall indicate on all appraisals performed by the person that the appraisal is not an appraisal done by a state certified or state licensed appraiser and the person performing the appraisal is a resident temporary licensee license or certificate holder.  A person holding a resident temporary license or certificate may perform appraisals only in areas within the state where it has been determined by the board that a scarcity exists.

F.  The board is exempt from title 41, chapter 6, article 10 in making the determination and finding and in issuing resident temporary licenses and certificates in accordance with the waiver in subsection D of this section and section 32‑3605, subsection B, paragraph 14.END_STATUTE

Sec. 19.  Title 32, chapter 36, article 2, Arizona Revised Statutes, is amended by adding sections 32-3627 and 32-3628, to read:

START_STATUTE32-3627.  Inactive license or certificate status; reactivation application; renewal application and fee; continuing education

A.  Any license or certificate holder may request that the license or certificate be placed on inactive status by filing with the board an application that includes all of the following:

1.  The license or certificate holder's name.

2.  The license or certificate number.

3.  A request for inactive status.

4.  The fee prescribed by section 32-3607.

B.  The period a license or certificate is on inactive status under this section may not exceed two years.

C.  A license or certificate holder who is on inactive status shall not do either of the following:

1.  Represent that the license or certificate holder is an active appraiser licensed or certified in this state.

2.  Perform real estate appraisals or appraisal reviews on real estate in this state.

D.  A license or certificate holder on inactive status under this section must file with the board an application for reactivation of the license or certificate before resuming real estate appraisal activity.

e.  To return to active status, an inactive license or certificate holder shall do all of the following:

1.  File with the board an application for reactivation of the license or certificate.

2.  Pay the applicable reactivation fee prescribed by section 32-3607.

3.  Provide evidence of completion of the required continuing education for which the license or certificate holder would have been required to meet during the period when the license or certificate holder's license or certificate was on inactive status.

F.  If the holder of an inactive license or certificate under this section does not file an application for reactivation within a two year period, that person must reapply for licensure or certification pursuant to the requirements of this chapter.

G.  A license or certificate holder who is on inactive status pursuant to this section remains on inactive status until the board approves the application for reactivation of the license or certificate.

H.  The board may take disciplinary or remedial action against a license or certificate holder who is on inactive status pursuant to this section.

I.  A license or certificate holder who places the holder's license or certificate on inactive status must pay the renewal fee and complete an application for renewal as prescribed in section 32-3619.  a license or certificate holder on inactive status is not required to provide evidence of completion of the continuing education requirements until the application for reactivation is filed pursuant to suBSECTION E of this section.END_STATUTE

START_STATUTE32-3628.  Inactive license or certificate status during military duty; reactivation application; renewal application and fee; continuing education

A.  A license or certificate holder who is ordered to active military duty with the United States armed forces may request that the license or certificate be placed on inactive status by filing with the board an application that includes all of the following:

1.  The license or certificate holder's name.

2.  The license or certificate number.

3.  The date that the active military duty begins.

4.  A request for inactive status.

5.  The fee prescribed by section 32-3607.

b.  The license or certificate is deemed to be on inactive status while the license or certificate holder is on active military duty but the period of inactive status may not exceed three years.

C.  A license or certificate holder who is on inactive status pursuant to this section shall not do either of the following:

1.  Represent that the holder is an active appraiser licensed or certified in this state.

2.  Perform real estate appraisals or appraisal reviews on real estate in this state.

D.  A license or certificate holder on inactive status must file with the board an application for reactivation of the license or certificate within thirty days after returning home from active military duty and pay the applicable reactivation fee prescribed by section 32-3607.

E.  If the holder of an inactive license or certificate timely files an application for reactivation of the license or certificate, the license or certificate is returned to active status on the board's approval of the application for reactivation.  The time period for completion of the continuing education requirements that the license or certificate holder would otherwise have been required to meet during the period when the license or certificate was on inactive status is extended for a period not to exceed one hundred eighty days after return from active military duty.  The license or certificate holder must submit proof of completion of any continuing education requirements to the board no later than thirty days after completion.

F.  If the holder of an inactive license or certificate under this section does not make a timely application for reactivation as required by subsection D of this section, the holder must reapply for licensure or certification meeting all of the requirements of this chapter.

G.  A license or certificate holder who is on inactive status pursuant to this section remains on inactive status until the board approves the application for reactivation of the license or certificate.

H.  The holder of an inactive license or certificate holder applying for reactivation of the license or certificate under this section shall include with the application for reactivation a copy of the documentation from the armed forces showing the period of time that the holder of the inactive license or certificate was on active military duty.

I.  Any license or certificate holder who places the holder's license or certificate on inactive status under this section must pay the renewal fee prescribed in section 32-3607 and complete an application for renewal pursuant to section 32-3619.  a license or certificate holder on inactive status pursuant to this section who files an application for reactivation is required to provide evidence of completion of the continuing education requirements pursuant to subsection E of this section.

J.  For the purposes of this SECTION, active military duty does not include service persons performing weekend drill and annual training.END_STATUTE

Sec. 20.  Section 32-3631, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3631.  Disciplinary proceedings

A.  The rights of an applicant or a holder under a license or certificate as a state licensed or state certified appraiser may be revoked or suspended or the holder of the license or certificate may otherwise be disciplined or an application may be denied in accordance with this chapter on any of the grounds set forth in this section.  The board may investigate the actions of a state licensed or state certified appraiser and may revoke or suspend the rights of a license or certificate holder or otherwise discipline a state licensed or state certified appraiser for any of the following acts or omissions:

1.  Procuring or attempting to procure a license or certificate pursuant to this chapter by knowingly making a false statement, submitting false information, refusing to provide complete information in response to a question in an application for a license or certificate or committing any form of fraud or misrepresentation.

2.  Failing to meet the minimum qualifications established by this chapter.

3.  Paying or offering to pay money or other considerations other than as provided by this chapter to any member or employee of the board to procure a license or certificate under this chapter.

4.  A conviction, including a conviction based on a plea of guilty, of a crime which is substantially related to the qualifications, functions and duties of a person developing appraisals and communicating appraisals to others, or convicted of any felony or any crime involving moral turpitude.

5.  An act or omission involving dishonesty, fraud or misrepresentation with the intent to substantially benefit the license or certificate holder or another person or with the intent to substantially injure another person.

6.  Violation of any of the standards of the development or communication of appraisals as provided in this chapter.

7.  Negligence or incompetence in developing an appraisal, in preparing an appraisal report or in communicating an appraisal.

8.  Willfully Wilfully disregarding or violating any of the provisions of this chapter or the rules of the board for the administration and enforcement of this chapter.

9.  Accepting an appraisal assignment if the employment itself is contingent on the appraiser reporting a predetermined estimate, analysis or opinion or if the fee to be paid is contingent on the opinion, conclusion or valuation value reached or on the consequences resulting from the appraisal assignment.

10.  Violating the confidential nature of any records to which he the appraiser gains access through employment or engagement as an appraiser.

11.  Entry of a final civil judgment against the person on grounds of fraud, misrepresentation or deceit in the making of any appraisal.

B.  In a disciplinary proceeding based on a civil judgment, the state licensed or state certified appraiser shall be afforded an opportunity to present matters in mitigation and extenuation.

C.  B.  The board may issue subpoenas for the attendance of witnesses and the production of books, records, documents and other evidence necessary and relevant to an investigation or hearing. END_STATUTE

Sec. 21.  Section 32-3636, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3636.  Contingent fees

A.  A state licensed or state certified appraiser may not accept a fee for an appraisal assignment that is contingent on the appraiser reporting a predetermined estimate, analysis or opinion or that is contingent on the opinion, conclusion or valuation value reached or on the consequences resulting from the appraisal assignment.

B.  A state licensed or state certified appraiser who enters into an agreement to perform specialized services may be paid a fixed fee or a fee that is contingent on the results achieved by the specialized services.

C.  If a state licensed or state certified appraiser enters into an agreement to perform specialized services for a contingent fee, this provision shall be clearly stated in each written or oral report.  In each written report, this provision shall be clearly stated in a prominent location in the report, in each letter of transmittal and in the certification statement made by the appraiser in the report. END_STATUTE

Sec. 22.  Section 32-3652, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3652.  Registration; renewal; fees

A.  An individual who wishes to act as a property tax agent shall apply for registration by submitting to the board a completed application form prescribed by the board with the initial registration fee.  The applicant shall also file with the board an affidavit stating whether the applicant has been convicted of a felony or any misdemeanor involving dishonesty or moral turpitude in this or any other state within the last ten years.  The board may review the affidavit and issue or deny the registration based on its findings.

B.  Registration is valid for two years.  An individual may renew a registration by submitting to the board a renewal form prescribed by the board with the renewal fee on or before the date the registration expires.

C.  An appraiser licensed or certified pursuant to this chapter may register and renew registration as a property tax agent without paying the fee prescribed by this section.

D.  C.  The board shall issue a certificate of registration to an individual, if the individual complies with this section and the individual is not prohibited from registering pursuant to section 32‑3654.

E.  D.  A person shall not act as a property tax agent if the person is not registered pursuant to this section.

F.  E.  The board shall collect from each individual a fee of:

1.  Two hundred dollars for an initial registration.

2.  One hundred dollars for a renewal.

3.  Five dollars for a duplicate registration certificate.

G.  F.  The board shall deposit, pursuant to sections 35‑146 and 35‑147, monies collected pursuant to subsection F  E of this section in the board of appraisal fund. END_STATUTE

Sec. 23.  Section 32-3654, Arizona Revised Statutes, is amended to read:

START_STATUTE32-3654.  Disciplinary actions

A.  On the complaint of any person or on its own motion, the board shall investigate any suspected violation of this article by a property tax agent.  If the board finds a violation it may issue a letter of concern.

B.  If the board finds that the property tax agent committed any of the following violations, it shall revoke or suspend the agent's registration:

1.  Secured registration by fraud or deceit.

2.  Committed an act or is responsible for an omission involving fraud or knowing misrepresentation with the intent to obtain a benefit.

3.  Knowingly violated section 32‑3653.

C.  The board shall:

1.  Suspend the agent's registration for not less than six months on the first finding of a violation pursuant to subsection B of this section.

2.  Suspend the agent's registration for not less than twelve months on the second finding of a violation pursuant to subsection B of this section.

3.  Revoke the agent's registration on a third or subsequent finding of a violation pursuant to subsection B of this section.

D.  The board shall not impose discipline until the agent has been provided an opportunity for a hearing before the board pursuant to title 41, chapter 6, article 10.  The board shall notify the agent of the charges and the date and time of the hearing. The notice may be personally served or sent by certified mail to the agent's last known address.  The board may assess the costs of the investigation and hearing against a person who is found guilty of violating this article.  Except as provided in section 41‑1092.08, subsection H, the final decision of the board is subject to judicial review pursuant to title 12, chapter 7, article 6.

E.  The board shall not renew an agent's registration during the time the registration is suspended or revoked.  If the agent is not registered or the agent's registration expires, the board shall not issue a new registration to the agent during the time the registration is suspended or revoked. END_STATUTE

Sec. 24.  Title 32, chapter 36, article 4, Arizona Revised Statutes, is amended by adding section 32-3656, to read:

START_STATUTE32-3656.  Confidential records

Except as otherwise provided by law, all documents associated with a complaint pursuant to this article are confidential until the complaint is resolved. END_STATUTE

Sec. 25.  Section 43-1089.02, Arizona Revised Statutes, is amended to read:

START_STATUTE43‑1089.02.  Credit for donation of school site

A.  A credit is allowed against the taxes imposed by this title in the amount of thirty per cent of the value of real property and improvements donated by the taxpayer to a school district or a charter school for use as a school or as a site for the construction of a school.

B.  To qualify for the credit:

1.  The real property and improvements must be located in this state.

2.  The real property and improvements must be conveyed unencumbered and in fee simple, except that:

(a)  The conveyance must include as a deed restriction and protective covenant running with title to the land the requirement that as long as the donee holds title to the property the property shall only be used as a school or as a site for the construction of a school, subject to the provisions of subsection I or J of this section.

(b)  In the case of a donation to a charter school, the donor shall record a lien on the property as provided by subsection J, paragraph 3 of this section.

3.  The conveyance shall not violate the provisions of section 15‑341, subsection D and section 15‑183, subsection V.

C.  For purposes of this section, the value of the donated property is the property's fair market value as determined in a certified an appraisal as defined in section 32‑3601 that is conducted by an independent party and that is paid for by the donee.

D.  If the property is donated by co-owners, including partners in a partnership and shareholders of an S corporation, as defined in section 1361 of the internal revenue code, each donor may claim only the pro rata share of the allowable credit under this section based on the ownership interest.  If the property is donated by a husband and wife who file separate returns for a taxable year in which they could have filed a joint return, they may determine between them the share of the credit each will claim.  The total of the credits allowed all co-owner donors may not exceed the allowable credit.

E.  If the allowable tax credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the taxpayer may carry the amount of the claim not used to offset the taxes under this title forward for not more than five consecutive taxable years' income tax liability.

F.  The credit under this section is in lieu of any deduction pursuant to section 170 of the internal revenue code taken for state tax purposes.

G.  On written request by the donee, the donor shall disclose in writing to the donee the amount of the credit allowed pursuant to this section with respect to the property received by the donee.

H.  A school district or charter school may refuse the donation of any property for purposes of this section.

I.  If the donee is a school district:

1.  The district shall notify the school facilities board established by section 15‑2001 and furnish the board with any information the board requests regarding the donation.  A school district shall not accept a donation pursuant to this section unless the school facilities board has reviewed the proposed donation and has issued a written determination that the real property and improvements are suitable as a school site or as a school.  The school facilities board shall issue a determination that the real property and improvements are not suitable as a school site or as a school if the expenses that would be necessary to make the property suitable as a school site or as a school exceed the value of the proposed donation.

2.  The district may sell any donated property pursuant to section 15‑342, but the proceeds from the sale shall only be used for capital projects.  The school facilities board shall withhold an amount that corresponds to the amount of the proceeds from any monies that would otherwise be due the school district from the school facilities board pursuant to section 15-2041.

J.  If the donee is a charter school:

1.  The charter school shall:

(a)  Immediately notify the sponsor of the charter school by certified mail and shall furnish the sponsor with any information requested by the sponsor regarding the donation during the ten year period after the conveyance is recorded.

(b)  Notify the sponsor by certified mail, and the sponsor shall notify the state treasurer, in the event of the charter school’s financial failure or if the charter school:

(i)  Fails to establish a charter school on the property within forty‑eight months after the conveyance is recorded.

(ii)  Fails to provide instruction to pupils on the property within forty-eight months after the conveyance is recorded.

(iii)  Establishes a charter school on the property but subsequently ceases to operate the charter school on the property for twenty‑four consecutive months or fails to provide instruction to pupils on the property for twenty-four consecutive months.

2.  The charter school, or a successor in interest, shall pay to the state treasurer the amount of the credit allowed under this section, or if that amount is unknown, the amount of the allowable credit under this section, if any of the circumstances listed in paragraph 1, subdivision (b) of this section subsection occur.  If the amount is not paid within one year after the treasurer receives notice under paragraph 1, subdivision (b) of this subsection, a penalty and interest shall be added, determined pursuant to title 42, chapter 1, article 3.

3.  A tax credit under this section constitutes a lien on the property, which the donor must record along with the title to the property to qualify for the credit.  The amount of the lien is the amount of the allowable credit under this section, adjusted according to the average change in the GDP price deflator, as defined in section 41-563, for each calendar year since the donation, but not exceeding twelve and one-half per cent more than the allowable credit.  The lien is subordinate to any liens securing the financing of the school construction.  The lien is extinguished on the earliest of the following:

(a)  Ten years after the lien is recorded.  After that date, the charter school, or a successor in interest, may request the state treasurer to release the lien.

(b)  On payment to the state treasurer by the donee charter school, or by a successor in interest, of the amount of the allowable credit under this section, either voluntarily or as required by paragraph 2 of this subsection. After the required amount is paid, the charter school or successor in interest may request the state treasurer to release the lien.

(c)  On conveyance of fee simple title to the property to a school district.

(d)  On enforcement and satisfaction of the lien pursuant to paragraph 4 of this subsection.

4.  The state treasurer shall enforce the lien by foreclosure within one year after receiving notice of any of the circumstances described in paragraph 1, subdivision (b) of this subsection.

5.  Subject to paragraphs 3 and 4 of this subsection, the charter school may sell any donated property.END_STATUTE

Sec. 26.  Section 43-1181, Arizona Revised Statutes, is amended to read:

START_STATUTE43-1181.  Credit of donation of school site

A.  A credit is allowed against the taxes imposed by this title in the amount of thirty per cent of the value of real property and improvements donated by the taxpayer to a school district or a charter school for use as a school or as a site for the construction of a school.

B.  To qualify for the credit:

1.  The real property and improvements must be located in this state.

2.  The real property and improvements must be conveyed unencumbered and in fee simple except that:

(a)  The conveyance must include as a deed restriction and protective covenant running with title to the land the requirement that as long as the donee holds title to the property the property shall only be used as a school or as a site for the construction of a school, subject to subsection I or J of this section.

(b)  In the case of a donation to a charter school, the donor shall record a lien on the property as provided by subsection J, paragraph 3 of this section.

3.  The conveyance shall not violate section 15‑341, subsection D or section 15‑183, subsection U.

C.  For the purposes of this section, the value of the donated property is the property's fair market value as determined in a certified an appraisal as defined in section 32‑3601 that is conducted by an independent party and that is paid for by the donee.

D.  If the property is donated by co‑owners, including corporate partners in a partnership, each donor may claim only the pro rata share of the allowable credit under this section based on the ownership interest.  The total of the credits allowed all co-owner donors may not exceed the allowable credit.

E.  If the allowable tax credit exceeds the taxes otherwise due under this title on the claimant's income, or if there are no taxes due under this title, the taxpayer may carry the amount of the claim not used to offset the taxes under this title forward for not more than five consecutive taxable years' income tax liability.

F.  The credit under this section is in lieu of any deduction pursuant to section 170 of the internal revenue code taken for state tax purposes.

G.  On written request by the donee, the donor shall disclose in writing to the donee the amount of the credit allowed pursuant to this section with respect to the property received by the donee.

H.  A school district or charter school may refuse the donation of any property for purposes of this section.

I.  If the donee is a school district:

1.  The district shall notify the school facilities board established by section 15‑2001 and furnish the board with any information the board requests regarding the donation.  A school district shall not accept a donation pursuant to this section unless the school facilities board has reviewed the proposed donation and has issued a written determination that the real property and improvements are suitable as a school site or as a school.  The school facilities board shall issue a determination that the real property and improvements are not suitable as a school site or as a school if the expenses that would be necessary to make the property suitable as a school site or as a school exceed the value of the proposed donation.

2.  The district may sell any donated property pursuant to section 15‑342, but the proceeds from the sale shall only be used for capital projects.  The school facilities board shall withhold an amount that corresponds to the amount of the proceeds from any monies that would otherwise be due the school district from the school facilities board pursuant to section 15‑2041.

J.  If the donee is a charter school:

1.  The charter school shall:

(a)  Immediately notify the sponsor of the charter school by certified mail and shall furnish the sponsor with any information requested by the sponsor regarding the donation during the ten year period after the conveyance is recorded.

(b)  Notify the sponsor by certified mail, and the sponsor shall notify the state treasurer, in the event of the charter school’s financial failure or if the charter school:

(i)  Fails to establish a charter school on the property within forty‑eight months after the conveyance is recorded.

(ii)  Fails to provide instruction to pupils on the property within forty-eight months after the conveyance is recorded.

(iii)  Establishes a charter school on the property but subsequently ceases to operate the charter school on the property for twenty-four consecutive months or fails to provide instruction to pupils on the property for twenty-four consecutive months.

2.  The charter school, or a successor in interest, shall pay to the state treasurer the amount of the credit allowed under this section, or if that amount is unknown, the amount of the allowable credit under this section, if any of the circumstances listed in paragraph 1, subdivision (b) of this subsection occur.  If the amount is not paid within one year after the treasurer receives notice under paragraph 1, subdivision (b) of this subsection, a penalty and interest shall be added, determined pursuant to title 42, chapter 1, article 3.

3.  A tax credit under this section constitutes a lien on the property, which the donor must record along with the title to the property to qualify for the credit.  The amount of the lien is the amount of the allowable credit under this section, adjusted according to the average change in the GDP price deflator, as defined in section 41‑563, for each calendar year since the donation, but not exceeding twelve and one-half per cent more than the allowable credit.  The lien is subordinate to any liens securing the financing of the school construction.  The lien is extinguished on the earliest of the following:

(a)  Ten years after the lien is recorded.  After that date, the charter school, or a successor in interest, may request the state treasurer to release the lien.

(b)  On payment to the state treasurer by the donee charter school, or by a successor in interest, of the amount of the allowable credit under this section, either voluntarily or as required by paragraph 2 of this subsection. After the required amount is paid, the charter school or successor in interest may request the state treasurer to release the lien.

(c)  On conveyance of fee simple title to the property to a school district.

(d)  On enforcement and satisfaction of the lien pursuant to paragraph 4 of this subsection.

4.  The state treasurer shall enforce the lien by foreclosure within one year after receiving notice of any of the circumstances described in paragraph 1, subdivision (b) of this subsection.

5.  Subject to paragraphs 3 and 4 of this subsection, the charter school may sell any donated property. END_STATUTE

Sec. 27.  Requirements for enactment; two-thirds vote

Pursuant to article IX, section 22, Constitution of Arizona, this act is effective only on the affirmative vote of at least two-thirds of the members of each house of the legislature and is effective immediately on the signature of the governor or, if the governor vetoes this act, on the subsequent affirmative vote of at least three-fourths of the members of each house of the legislature.