Chapter 0335 - 531R - H Ver of SB1218

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

Section 1. Section 28-2063, Arizona Revised Statutes, is amended to read:

START_STATUTE28-2063. Mobile home certificate of title; exceptions; fee

A. The department shall issue a certificate of title for a mobile home that is customarily kept in this state and the fee required under section 28‑2003 shall be paid except for:

1. A mobile home that is owned and held by a dealer solely for purposes of sale.

2. A mobile home that is owned and operated exclusively in the public service by the United States, by this state or by any political subdivision of this state, except that it shall have a certificate of title.

3. A mobile home that is permanently affixed, as defined in section 42‑15201, and for which an affidavit of affixture has been recorded pursuant to section 33‑1501. The owner shall surrender the original certificates of title or manufacturer's statements of origin to permanently affixed mobile homes to the department in the manner prescribed by the department. The department shall issue a receipt for the documents surrendered pursuant to this paragraph.

B. The issuance of a certificate of title for a mobile home shall be as provided by law for the issuance of a certificate of title for motor vehicles, except that in the case of a mobile home that consists of two or more separate sections, each section shall have a separate certificate of title.

C. A mobile home is subject to all applicable provisions of this title, except those relating to registration.

D. If a certificate of title is applied for on a mobile home entering this state for sale or installation, a certificate of compliance or waiver issued by the office of manufactured Arizona department of housing is required and shall be submitted with the certificate of title application. END_STATUTE

Sec. 2. Section 33-1501, Arizona Revised Statutes, is amended to read:

START_STATUTE33-1501. Affidavit of affixture for mobile home in mobile home park

A. Notwithstanding any other statute, a person who owns a mobile home that is located in a mobile home park on real property that is not owned by that person may file an affidavit of affixture with the county recorder of the county in which the real property is located if all of the following conditions are met:

1. The mobile home has been installed on the real property with all wheels and axles removed in compliance with applicable state and local mobile home installation standards.

2. The owner of the mobile home has entered into a lease for the real property on which the mobile home is located for a primary term of at least twenty years and the lease specifically permits the recording of an affidavit of affixture.

3. Before filing the affidavit of affixture, a memorandum of lease is recorded that includes all of the following:

(a) The names and addresses of the landlord and the tenant.

(b) The duration of the primary term of the lease.

(d) The make, year, size, manufacturer's list price and vehicle identification numbers of the mobile home.

(e) The legal description of the real property on which the mobile home is located.

(f) The acknowledged signatures of both the landlord and the tenant. A memorandum of lease is not valid unless the signatures of both the landlord and the tenant are included on the memorandum and are acknowledged.

B. For a mobile home park, a legal description of the real property is sufficient as follows:

1. For a mobile home park that has a subdivision plat recorded with the county recorder that identifies the individual lots, the description shall refer to the lot, the name of the community as shown on the plat and the recording information for the plat of record.

2. A mobile home park may record a leasehold map of the mobile home park. A leasehold map shall, at a minimum, set forth the legal description of the land comprising the mobile home park, show the location of all rental spaces of the mobile home park and assign each space a unique identifying number. To qualify as a leasehold map, the map shall identify the mobile home park by name and contain a certification by the owner of the land that it accurately depicts the location and dimensions of all mobile home spaces in the mobile home park. Leasehold maps shall be recorded as maps by the county recorder and shall conform to size and other restrictions applicable to the recording of maps. For a mobile home park that has recorded a leasehold map, the legal description is sufficient if it refers to the space number of the mobile home space as shown on the leasehold map and refers to the recording data pertaining to the leasehold map.

3. For a mobile home park that does not have a plat recorded with the county recorder that identifies individual lots, the description shall comply with any of the following:

(a) A metes and bounds description of the real property that is subject to the lease. This description shall also serve as the legal description of the mobile home lot in the lease.

(b) A reference to a lot number that is contained in an unrecorded plat of the mobile home park if a legible copy of the plat is attached to both the memorandum of lease and the affidavit of affixture and each copy of the unrecorded plat sets forth the exact dimensions of the mobile home lot. The location of the lot shall be shown on the plat so that the lot can be located with certainty.

(c) A reference to a lot number that is contained in a development plan that has been reviewed and approved by the county or municipal planning department that has jurisdiction over the land depicted in the development plan. The description is sufficient if it contains the name and date of the development plan, the lot number of the designated lot and the actual or approximate date of approval of the development plan by the planning department. A legible copy of the development plan lot shall be attached to both the memorandum of lease and the affidavit of affixture and each copy of the development plan lot shall set forth the exact dimensions of the mobile home lot and shall show its exact location.

C. An affidavit of affixture that is filed pursuant to this section shall contain all of the following:

1. The make, year, size, manufacturer's list price and vehicle identification numbers of the mobile home.

2. The legal description of the real property to which the mobile home has been affixed.

3. A statement that the mobile home has not previously been assessed and taxed in this state as personal property or the name and address of the persons to whom the last tax statement for the mobile home was sent and the location of the mobile home when it was last taxed.

4. The name of the holder of any security interests in the mobile home that are not terminated by the consent of the secured party that is contained in the affidavit of affixture pursuant to subsection E of this section and the original principal amount that is secured by the security interest.

D. The department of transportation's receipt that is issued pursuant to section 28‑2063, subsection A, paragraph 3 shall be filed with the assessor in the county the affidavit of affixture is recorded.

E. The recording of an affidavit of affixture does not impair the rights of any holder of a perfected security interest in the mobile home unless the affidavit of affixture contains the acknowledged consent of the secured party to the termination of the security interest. If a secured party so consents, that security interest terminates when the affidavit of affixture is recorded.

F. If an affidavit of affixture is submitted for recording on a mobile home that enters this state for sale or installation, a certificate of compliance or waiver that is issued by the office of manufactured Arizona department of housing is required and shall be submitted with the affidavit of affixture.

G. The landlord under the lease who is also the owner of the real property on which the mobile home is located may record a notice and affidavit that terminates an affidavit of affixture of a mobile home on the landlord's real property if the lease has been terminated before its expiration. In that event, the landlord shall attach to the notice and affidavit one of the following:

1. An agreement executed by both the landlord and the tenant in which both parties agree to the termination of the lease.

2. A copy of a judgment for forcible detainer that is entered by a court of competent jurisdiction, that upholds the termination of the lease and that awards possession of the real property to the landlord.

3. An affidavit of the landlord stating that the mobile home has been removed from the real property.

H. At any time after the landlord records a notice and affidavit terminating an affidavit of affixture pursuant to subsection G of this section, the department of transportation shall retitle the mobile home to the owner of the mobile home on presentation of a copy of the notice and affidavit that terminates the affidavit of affixture, together with a document that contains a tax clearance from the county treasurer's office, and on satisfaction of other requirements that the department of transportation imposes.

I. The mobile home and the leasehold interest to which it is affixed shall be treated as real property. The provisions of This chapter apply applies to the relationship between the landlord and the owner of the mobile home as tenant.

J. If there is a change in the identity of the owner of the mobile home during the term of any lease for which an affidavit of affixture has been recorded pursuant to this section, the landlord and the new owner of the mobile home as successor tenant shall execute an amended memorandum of lease that identifies the successor tenant and that refers to the affidavit of affixture by date and recording information. On the recording of the amended memorandum of lease, the successor tenant succeeds to the rights and obligations of the owner under the affidavit of affixture. END_STATUTE

Sec. 3. Section 36-1639, Arizona Revised Statutes, is amended to read:

START_STATUTE36-1639. Exemptions

This article does not apply to:

1. Manufactured homes as defined in section 41‑4001 that were manufactured from and after June 15, 1976.

2. Factory‑built buildings as defined by section 41‑4001 that display an insignia of approval a certificate from the Arizona department of housing, office of administration. END_STATUTE

Sec. 4. Section 41-3953, Arizona Revised Statutes, is amended to read:

START_STATUTE41-3953. Department powers and duties

A. The department is responsible for establishing policies, procedures and programs that the department is authorized to conduct to address the affordable housing issues confronting this state, including housing issues of low income families, moderate income families, housing affordability, special needs populations and decaying housing stock. Among other things, the department shall provide to qualified housing participants and political subdivisions of this state financial, advisory, consultative, planning, training and educational assistance for the development of safe, decent and affordable housing, including housing for low and moderate income households. The department is responsible for maintaining and enforcing standards of quality and safety for manufactured homes, mobile homes and factory‑built buildings.

B. Under the direction of the director, the department shall:

1. Establish guidelines applicable to the programs and activities of the department for the construction and financing of affordable housing and housing for low and moderate income households in this state. These guidelines shall meet or exceed all applicable state or local building and health and safety code requirements and, if applicable, the national manufactured home construction and safety standards act of 1974 and title VI of the housing and community development act of 1974 (P.L. 93‑383, as amended by P.L. 95‑128, 96‑153 and 96‑339). Guidelines established pursuant to this paragraph do not apply to the department's activities prescribed in section 35‑726, subsection E.

2. Accept and allocate any monies as from time to time may be appropriated by the legislature for the purposes set forth in this article.

3. Perform other duties necessary to administer this chapter.

4. Perform the duties prescribed in sections 35‑726 and 35‑728.

5. Stimulate and encourage all local, state, regional and federal governmental agencies and all private persons and enterprises that have similar and related objectives and purposes, cooperate with the agencies, persons and enterprises and correlate department plans, programs and operations with those of the agencies, persons and enterprises.

6. Conduct research on its own initiative or at the request of the governor, the legislature or state or local agencies pertaining to any department objectives.

7. Provide information and advice on request of any local, state or federal agencies, private persons and business enterprises on matters within the scope of department activities.

8. Consult with and make recommendations to the governor and the legislature on all matters concerning department objectives.

9. Make annual reports to the governor and the legislature on its activities, including the geographic location of its activities, its finances and the scope of its operations.

10. Maintain and enforce standards of quality and safety for manufactured homes, mobile homes and factory‑built buildings and enforce rules adopted by the board pursuant to section 41‑4010.

C. Under the direction of the director, the department may:

1. Assist in securing construction and mortgage financing from public and private sector sources.

2. Assist mortgage financing programs established by industrial development authorities and political subdivisions of this state.

3. Assist in the acquisition and use of federal housing assistance programs pertinent to enhance the economic feasibility of a proposed residential development.

4. Assist in the compliance of a proposed residential development with applicable federal, state and local codes and ordinances.

5. Prepare and publish planning and development guidelines for the establishment and delivery of housing assistance programs.

6. Contract with a federal agency to carry out financial work on the federal agency's behalf and accept payment for the work.

7. Subcontract for the financial work prescribed in paragraph 6 of this subsection and make payments for that subcontracted work based on the expectation that the federal agency will pay for that work.

8. Accept payment from a federal agency for work prescribed in paragraph 6 of this subsection and deposit those payments in the Arizona department of housing program fund established by section 41‑3957.

9. Contract for the services of outside advisers, consultants and aides reasonably necessary or desirable to enable the department to adequately perform its duties.

10. Contract for and incur obligations reasonably necessary or desirable within the general scope of department activities and operations to enable the department to adequately perform its duties.

11. Use any media of communication, publication and exhibition in the dissemination of information, advertising and publicity in any field of its purposes, objectives or duties.

12. Adopt rules deemed necessary or desirable to govern its procedures and business.

13. Contract with other agencies in furtherance of any department program.

14. Use monies, facilities or services to provide contributions under federal or other programs that further the objectives and programs of the department.

15. Accept gifts, grants, matching monies or direct payments from public or private agencies or private persons and enterprises for the conduct of programs that are consistent with the general purposes and objectives of this article and deposit these monies in the Arizona department of housing program fund established by section 41‑3957.

16. Establish and collect fees and receive reimbursement of costs in connection with any programs or duties performed by the department and deposit the fees and cost reimbursements in the Arizona department of housing program fund established by section 41‑3957.

17. Provide staff support to the board of manufactured housing.

D. For the purposes of this section, the department is exempt from chapter 23 of this title.

E. The department is the designated state public housing agency as defined in the United States housing act of 1937 (42 United States Code sections 1401 through 1440) for the purpose of accepting federal housing assistance monies and may participate in the housing assistance payments program. Federal monies may be secured for all areas of this state subject only to the limitations prescribed in subsection F of this section.

F. For areas of this state where an existing public housing authority has not been established pursuant to section 36‑1404, subsection A, the department acting as a public housing agency may undertake all activities under the section 8 tenant‑based rental housing assistance payment program, except that the department shall not undertake a section 8 tenant‑based rental housing assistance payment program within the boundaries of a city, town or county unless authorized by resolution of the governing body of the city, town or county. If the department accepts monies for a section 8 tenant‑based rental housing assistance payment program for areas of this state where an existing public housing authority has been established pursuant to section 36‑1404, subsection A, the department shall only accept and secure federal monies to provide housing for the seriously mentally ill or other populations with disabilities. The department may accept and secure federal monies for undertaking all contract administrator activities authorized under a section 8 project‑based rental housing assistance payment program in all areas of this state and this participation does not require the authorization of any local governing body.

G. The department shall not itself directly own, construct, operate or rehabilitate any housing units, except as may be necessary to protect the department's collateral or security interest arising out of any department programs.

H. Notwithstanding any other provision of this section, the department may obligate monies as loans or grants applicable to programs and activities of the department for the purpose of providing housing opportunities for low or moderate income households or for housing affordability or to prevent or combat decaying housing stock. Unless otherwise required by federal or state law, any loan repayments shall be deposited in the Arizona department of housing program fund established by section 41‑3957.

I. For any construction project financed by the department pursuant to subsection C of this section, except for contract administration activities in connection with the project‑based section 8 program, the department shall notify a city, town, county or tribal government that a project is planned for its jurisdiction and, before proceeding, shall seek comment from the governing body of the city, town, county or tribal government or an official authorized by the governing body of the city, town, county or tribal government. The department shall not interfere with or attempt to override the local jurisdiction's planning, zoning or land use regulations.

J. The department has the administrative responsibility through its hearing officer function concerning alleged violations of the Arizona mobile home parks residential landlord and tenant act under title 33, chapter 11.

K. The department shall act consistently with the minimum standards of the United States department of housing and urban development as so to be designated the "state inspector" for manufactured homes and related industries. The department shall implement all existing laws and regulations established by the federal government, its agencies and this state for that purpose. END_STATUTE

Sec. 5. Section 41-4001, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4001. Definitions

In this chapter, unless the context otherwise requires:

1. "Accessory structure" means the installation, assembly, connection or construction of any one‑story habitable room, storage room, patio, porch, garage, carport, awning, skirting, retaining wall, evaporative cooler, refrigeration air conditioning system, solar system or wood decking attached to a new or used manufactured home, mobile home or residential single family factory‑built building.

2. "Act" means the national manufactured home housing construction and safety standards act of 1974 and title VI of the housing and community development act of 1974 (P.L. 93‑383, as amended by P.L. 95‑128, 95‑557, 96‑153 and 96‑339).

3. "Alteration" means the replacement, addition, modification or removal of any equipment or installation after the sale by a manufacturer to a dealer or distributor but prior to before the sale by a dealer to a purchaser, which may affect compliance with the standards, construction, fire safety, occupancy, plumbing or heat‑producing or electrical system. Alteration does not mean the repair or replacement of a component or appliance requiring plug‑in to an electrical receptacle if the replaced item is of the same configuration and rating as the component or appliance being repaired or replaced. Alteration also does not mean the addition of an appliance requiring plug‑in to an electrical receptacle if such appliance is not provided with the unit by the manufacturer and the rating of the appliance does not exceed the rating of the receptacle to which such appliance is connected.

4. "Board" means the board of manufactured housing.

5. "Broker" means any person who, on behalf of another, sells, exchanges, buys, offers or attempts to negotiate or acts as an agent for the sale or exchange of a used manufactured home or mobile home except as exempted in section 41‑4028.

6. "Certificate" means a numbered or serialized label or seal that is issued by the director as certification of compliance with this chapter.

6. 7. "Component" means any part, material or appliance that is built‑in as an integral part of the unit during the manufacturing process.

7. 8. "Consumer" means either a purchaser or seller of a unit regulated by this chapter who utilizes the services of a person licensed by the department.

8. 9. "Consummation of sale" means that a purchaser has received all goods and services that the dealer or broker agreed to provide at the time the contract was entered into, or the transfer of title or the filing of an affidavit of affixture, if applicable, to the sale. Consummation of sale does not include warranties.

9. 10. "Dealer" means any person who sells, exchanges, buys, offers or attempts to negotiate or acts as an agent for the sale or exchange of factory‑built buildings, subassemblies, manufactured homes or mobile homes except as exempted in section 41‑4028. A lease or rental agreement by which the user acquired ownership of the unit with or without additional remuneration is considered a sale under this chapter.

10. 11. "Defect" means any defect in the performance, construction, components or material of a unit that renders the unit or any part of the unit unfit for the ordinary use for which it was intended.

11. 12. "Department" means the Arizona department of housing.

12. 13. "Director" means the director of the department.

13. 14. "Earnest monies" means all monies given by a purchaser or a financial institution to a dealer or broker before consummation of the sale.

14. 15. "Factory‑built building":

(a) Means a residential or nonresidential commercial building including a dwelling unit or habitable room thereof that is:

(i) Either wholly or in substantial part manufactured at an off‑site location to be assembled and transported for installation or completion, or both, on‑site, .

(ii) Constructed in compliance with adopted codes, standards and procedures.

(iii) Installed temporarily or permanently.

(b) except that it Does not include a manufactured home, recreational vehicle, or mobile home as defined in this section panelized building or domestic or light commercial storage building.

15. 16. "HUD" means the United States department of housing and urban development.

16. 17. "Imminent safety hazard" means an imminent and unreasonable risk of death or severe personal injury.

17. "Insignia of approval" means a numbered or serialized label or seal issued by the director as certification of compliance with this chapter.

18. "Installation" means:

(a) Connecting new or used mobile homes, manufactured homes or factory‑built buildings to on‑site utility terminals or repairing these utility connections.

(b) Placing new or used mobile homes, manufactured homes, accessory structures or factory‑built buildings on foundation systems or repairing these foundation systems.

19. "Installer" means any person who engages in the business of performing installations of manufactured homes, mobile homes or residential single family factory‑built buildings.

20. "Installer of accessory structures" means any person who engages in the business of installing accessory structures.

21. "Listing agreement" means a document that contains the name and address of the seller, a description of the unit to be listed and the terms, including the period of time the year, manufacturer and serial number of the listed unit, the beginning and ending dates of the time period that the agreement is in force, the name of the lender and lien amount, if applicable, the price the seller is requesting for the unit, the commission to be paid to the licensee and the signatures of the sellers and the licensee who obtains the listing.

22. "Local enforcement agency" means a zoning or building department of a city, town or county or its agents.

23. "Manufactured home" means a structure built in accordance with the act.

24. "Manufacturer" means any person engaged in manufacturing, assembling or reconstructing any unit regulated by this chapter.

25. "Mobile home" means a structure built prior to before June 15, 1976, on a permanent chassis, capable of being transported in one or more sections and designed to be used with or without a permanent foundation as a dwelling when connected to on‑site utilities. except mobile home does not include recreational vehicles and factory‑built buildings.

26. "Office" means the office of manufactured housing within the department.

27. "Purchaser" means a person purchasing a unit in good faith from a licensed dealer or broker for purposes other than resale.

28. "Qualifying party" means a person who is an owner, employee, corporate officer or partner of the licensed business and who has active and direct supervision of and responsibility for all operations of that licensed business.

29. "Reconstruction" means construction work performed for the purpose of restoration or modification of a unit by changing or adding structural components or electrical, plumbing or heat or air producing systems.

30. "Recreational vehicle" means a vehicular type unit that is:

(a) A portable camping trailer mounted on wheels and constructed with collapsible partial sidewalls that fold for towing by another vehicle and unfold for camping.

(b) A motor home designed to provide temporary living quarters for recreational, camping or travel use and built on or permanently attached to a self‑propelled motor vehicle chassis or on a chassis cab or van that is an integral part of the completed vehicle.

(c) A park trailer built on a single chassis, mounted on wheels and designed to be connected to utilities necessary for operation of installed fixtures and appliances and has a gross trailer area of not less than three hundred twenty square feet and not more than four hundred square feet when it is set up, except that it does not include fifth wheel trailers.

(d) A travel trailer mounted on wheels, designed to provide temporary living quarters for recreational, camping or travel use, of a size or weight that may or may not require special highway movement permits when towed by a motorized vehicle and has a trailer area of less than three hundred twenty square feet. This subdivision includes fifth wheel trailers. If a unit requires a size or weight permit, it shall be manufactured to the standards for park trailers in a 119.5 of the American national standards institute code.

(e) A portable truck camper constructed to provide temporary living quarters for recreational, travel or camping use and consisting of a roof, floor and sides designed to be loaded onto and unloaded from the bed of a pickup truck.

31. "Safety" means the performance of a unit in such a manner that the public is protected against any unreasonable risk of the occurrence of accidents due to the design or construction of such unit, or any unreasonable risk of death or injury to the user or to the public if such accidents occur.

32. 31. "Salesperson" means any person who, for a salary, commission or compensation of any kind, is employed by or acts on behalf of any dealer or broker of manufactured homes, mobile homes or factory‑built buildings to sell, exchange, buy, offer or attempt to negotiate or act as an agent for the sale or exchange of an interest in a manufactured home, mobile home or factory‑built building.

33. 32. "Seller" means a natural person who enters into a listing agreement with a licensed dealer or broker for the purpose of resale.

34. 33. "Site development" means the development of an area for the installation of the unit's or units' locations, parking, surface drainage, driveways, on‑site utility terminals and property lines at a proposed construction site or area.

35. 34. "Statutory agent" means an adult person who has been a bona fide resident of this state for at least three years and has agreed to act as agent for a licensee a person who is on file with the corporation commission as the statutory agent.

36. "Subassembly" means a prefabricated wall, floor, ceiling, roof or similar combination of components.

37. 35. "Title transfer" means a true copy of the application for title transfer that is stamped or validated by the appropriate government agency.

38. 36. "Unit" means a manufactured home, mobile home, factory‑built building, subassembly or accessory structures.

39. 37. "Used unit" means any unit that is regulated by this chapter and that has been sold, bargained, exchanged or given away from a purchaser who first acquired the unit that was titled in the name of such purchaser.

40. 38. "Workmanship" means a minimum standard of construction or installation reflecting a journeyman quality of the work of the various trades. END_STATUTE

Sec. 6. Section 41-4002, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4002. Office of manufactured housing; purpose

The purpose of the office of manufactured housing within the department is to maintain and enforce standards of quality and safety for manufactured homes, factory‑built buildings, mobile homes and accessory structures and installation of manufactured and mobile homes, factory‑built buildings and accessory structures. The affairs of the office of manufactured housing shall be conducted consistently with minimum standards of the United States department of housing and urban development so as to be designated the "state inspector" for manufactured homes and related industries. The office shall implement all existing laws and regulations mandated by the federal government, its agencies and this state for such purposes. END_STATUTE

Sec. 7. Section 41-4004, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4004. Powers and duties of department; work by unlicensed person; inspection agreement; permit

A. The deputy director under the authority and direction of the director shall administer the provisions of this article and the rules adopted by the board.

B. A. The deputy director department shall:

1. Establish a state inspection and design approval bureau within the office department.

2. Enter into reciprocity agreements and compacts with other states or private organizations that adopt and maintain standards of construction reasonably consistent with those adopted pursuant to this article on determining that such standards are being enforced. The deputy director may void such agreements on determining such standards are not being maintained.

3. Authorize affixment of insignia Issue a certificate to indicate compliance with the construction and installation requirements of this article.

4. Enter and inspect or investigate premises at reasonable times, after presentation of credentials by the deputy director or personnel of the office or under contract with the office, where units regulated by this article are manufactured, sold or installed, to determine if any person has violated this article chapter or the rules adopted pursuant to this article chapter.

5. Enter into agreements with local enforcement agencies to enforce the installation standards in their jurisdiction provided the deputy director is monitoring their performance to be consistent with the installation standards of the office.

6. If an inspection reveals that a mobile home entering this state for sale or installation is in violation of this chapter, order its use discontinued and the mobile home or any portion of the mobile home vacated. The order to vacate shall be served on the person occupying the mobile home and copies of the order shall be posted at or on each exit of the mobile home. The order to vacate shall include a reasonable period of time in which the violation can be corrected.

7. If an inspection of a new installation of any mobile home or manufactured home reveals that the natural gas or electrical connections of the installation do not conform to the installation standards promulgated pursuant to this article chapter and the nonconformance constitutes an immediate danger to life and property, the inhabitants of the home shall be notified immediately and in their absence a notice citing the violations shall be posted in a conspicuous location. The deputy director may order that the public service corporation, municipal corporation or other entity or individual supplying the service to the unit discontinue such service. If the danger is not immediate, the deputy director shall allow at least twenty‑four hours to correct the condition before ordering any discontinuation of service.

8. If construction, installation, rebuilding or any other work is performed in violation of this chapter or any rule adopted pursuant to this chapter, order the work stopped. The order to stop work shall be served on the person doing the work or on the person causing the work to be done. The person served with the order shall immediately cease the work until authorized by the office to continue.

9. Verify written complaints filed with the office by purchasers within one year after the date of purchase or installation of units. Complaints shall be accepted from consumers which that allege violations by any dealer, broker, salesperson, installer or manufacturer of this chapter or the rules adopted pursuant to this chapter.

10. On verification of a complaint pursuant to paragraph 9 of this subsection, serve notice to the dealer, broker, salesperson, installer or manufacturer that such verified complaint shall be satisfied as specified by the office.

C. B. Any dealer, broker, salesperson, installer or manufacturer licensed by the office shall respond within thirty days to a notice served pursuant to subsection B A, paragraph 10 of this section. Failure to respond is grounds for disciplinary action pursuant to section 41‑4039.

D. C. If an inspection or an investigation reveals that any work that is required to be performed by a licensee was performed by an unlicensed person required to be licensed pursuant to this chapter, the deputy director, an employee or a person under contract with the office may cite the unlicensed person. The citation may be issued and served pursuant to section 13‑3903. The action shall be filed in the justice court in the precinct where the unlicensed activity occurred.

E. D. The deputy director may enter into agreements with acceptable qualified building inspection personnel or inspection organizations for enforcement of inspection requirements provided the deputy director is monitoring their performance to be consistent with this article chapter, rules adopted pursuant to this article chapter and the established procedures of the office. If the deputy director determines that the person's or organization's performance is not consistent with this article chapter, rules adopted pursuant to this article chapter and the established procedures of the office, the person or organization may not enforce the contract and the aggrieved person shall be entitled to a refund of the consideration paid under the agreement.

F. E. If a mobile or manufactured home or factory‑built building is installed without first obtaining an installation permit, the deputy director shall send a written notice to the purchaser specifying that a permit is required. If a permit is not obtained within thirty days after receipt of the written notice, the department shall issue and serve by personal service or certified mail a citation on the purchaser. Service of the citation by certified mail is complete after forty‑eight hours after the time of deposit in the mail. On failure of the purchaser to comply with the citation within twenty days after its receipt, the deputy director shall file an action in the justice court in the precinct where installation occurred for violation of this subsection. END_STATUTE

Sec. 8. Section 41-4005, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4005. Submission of construction, reconstruction or alteration plans by manufacturers; approval; revocation

A. Prior to Before the construction of any new model of factory‑built building or subassembly, each manufacturer who intends to manufacture for delivery or sell such unit in this state shall submit to the director for approval detailed plans of each model and shall have obtained such approval.

B. Prior to Before reconstruction of any factory‑built building, including those for which the director has not approved plans before construction, the licensee shall submit to the director for approval detailed plans of the factory‑built building that indicate conformance with this state's adopted codes as certified by an engineer who is registered pursuant to title 32, chapter 1.

C. Prior to Before installation of a factory‑built building or accessory structure, each licensee who intends to accomplish the construction shall submit to the director for approval detailed plans for each project and shall obtain the director's approval.

D. The office or a third party third‑party inspector who is authorized by the deputy director to verify compliance with the approved plans shall inspect the factory‑built building.

E. A plan approval may be immediately suspended by the written notice of the deputy director if the deputy director has reasonable cause to believe that the licensee is not complying with the plan as approved or that the licensee has used inferior materials or workmanship in construction. This notice shall be served by personal service to an in‑state licensee and by certified mail to an out‑of‑state licensee. Service of process by certified mail is complete after forty‑eight hours from the time of deposit in the mail. END_STATUTE

Sec. 9. Section 41-4006, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4006. Preemption of local building codes; responsibility for maintenance of utility connections

A. No building code or local enforcement agency or its adopted building codes may require, as a condition of entry into or sale in any county or municipality, that any unit which that has been certified pursuant to this article chapter be subjected to any local enforcement inspection to determine compliance with any standard covering any aspect of the unit which that is inspected pursuant to this article.

B. Except where a local enforcement agency participates in the office permit and insignia certificate issuance program for the installation of manufactured homes, mobile homes, factory‑built buildings and accessory structures and inspection of such installations, no local enforcement agency shall subject any unit installed to any local inspections or charge a fee for any services provided pursuant to this article.

C. A local enforcement agency in any county or municipality shall recognize the minimum standards of the act as equal to any nationally accepted or locally adopted building code standard.

D. Nothing in subsection A, B or C of this section shall prevent the application of local codes and ordinances governing zoning requirements, fire zones, building setback, maximum area and fire separation requirements, site development and property line requirements and requirements for on‑site utility terminals for factory‑built buildings, manufactured homes and mobile homes.

E. Notwithstanding any other provision of this section, the owner of a manufactured home or mobile home located in a park subject to title 33, chapter 11 is responsible for the maintenance of utility connections from any outlets furnished by the landlord pursuant to section 33‑1434 to the unit, except that the landlord is responsible for the maintenance of connections for any distance greater than twenty‑five feet to the point at which the utility connections are the property of the providing utility company if the outlet is located outside the lot line of the owner's unit and is more than twenty‑five feet from the unit. A local enforcement agency that determines that local code requirements are not being met or that maintenance or safety activities are needed for utility connections may not require anyone except the responsible party to perform or pay for such activities. END_STATUTE

Sec. 10. Section 41-4009, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4009. Board of manufactured housing; members; meetings

A. There is established a The board of manufactured housing is established. The board shall consist of nine members appointed by the governor pursuant to section 38‑211. One member shall represent the manufacturers of manufactured homes, one shall represent the installer industry, one shall represent manufactured home park owners, one shall represent financial institutions, one shall represent the manufacturers of residential factory-built buildings, one shall represent the dealers and brokers and three members of the public, at least one of whom has as his residence a mobile or manufactured home and is a resident of a mobile home park or manufactured home park, shall represent the consumers of this state. Each member shall be appointed for a term of three years. The governor may remove any member from the board for incompetency, improper conduct, disability or neglect of duty. Members are eligible to receive compensation pursuant to section 38‑611 and are eligible for reimbursement for expenses incurred while attending meetings called by the board pursuant to title 38, chapter 4, article 2.

B. The board annually shall select from its membership a chairperson for the board.

C. The board shall meet on call of the chairperson or on the request of at least four members. END_STATUTE

Sec. 11. Section 41-4010, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4010. Powers and duties of board

A. The board shall:

1. Adopt rules imposing minimum construction requirements for factory‑built buildings, subassemblies and components thereof that are reasonably consistent with nationally recognized and accepted publications or generally accepted manufacturing practices pertinent to the construction and safety standards for such item to be manufactured. These standards shall include minimum requirements for the safety and welfare of the public.

2. Adopt rules imposing requirements for body and frame design and construction and installation of plumbing, heating and electrical systems for manufactured homes that are consistent with the rules and regulations for construction and safety standards adopted by the United States department of housing and urban development.

3. Adopt rules relating to plan approvals as to requirements for the design, construction, alteration, reconstruction and installation of units or accessory structures as deemed necessary by the board to carry out this chapter.

4. Establish a schedule of fees, payable by persons, licensees or owners of units regulated by this chapter, for inspections, licenses, permits, plan reviews, administrative functions and insignia certificates so that the total annual income derived from such fees will not be less than ninety‑five percent and not more than one hundred five percent of the anticipated expenditures for the operation of the office of manufactured housing administration of the activities described in this subsection.

5. Adopt rules relating to the inspection throughout the state by the director department of the installation of manufactured homes, mobile homes, factory‑built buildings and accessory structures included as part of a sales contract for a new or used mobile or manufactured home, mobile home or factory‑built building or part of included in an agreement to move a new or used mobile or manufactured home, mobile home or factory‑built building.

6. Establish and maintain licensing standards and bonding requirements for all manufacturers of manufactured homes, and factory‑built buildings and subassemblies regulated pursuant to this chapter.

7. Establish and maintain licensing standards and bonding requirements for all dealers and brokers of manufactured homes, mobile homes, and factory‑built buildings and subassemblies thereof who sell or arrange the sale of such products within this state.

8. Establish and maintain licensing standards and bonding requirements for all installers of manufactured homes, mobile homes and accessory structures and certified standards for all persons who repair these homes and structures under warranties and who are not employees of the manufacturer.

9. Establish and maintain licensing standards for all salespersons of manufactured homes, mobile homes and factory‑built buildings. These standards shall not include educational requirements.

10. Adopt rules consistent with the United States department of housing and urban development procedural and enforcement regulations and enter into such contracts necessary to administer the federal manufactured home regulations.

11. Adopt rules imposing minimum fire and life safety requirements in the categories of fire detection equipment, flame spread for gas furnace and water heater compartments, egress windows, electrical system and gas system for mobile homes entering this state.

12. Adopt rules for inspections and permits for minimum fire and life safety requirements and establish fees for such inspections and permits for mobile homes entering this state.

13. Adopt such other rules as the board deems necessary for the director department to carry out this chapter and, to the extent not authorized by other provisions of this section, adopt rules as necessary to interpret, clarify, administer or enforce this article and article 4 of this chapter.

14. Adopt rules relating to the installation of manufactured homes, mobile homes, factory‑built buildings and accessory structures included as part of a sales contract for a new or used mobile home, or new or used manufactured home or new or used factory‑built building or part of an agreement to move a new or used mobile home, or new or used manufactured home or new or used factory‑built building. This paragraph does not apply to:

(a) Single wide factory‑built buildings that are used for construction project office purposes and that are not used by the public.

(b) Storage buildings of less than one hundred sixty‑eight square feet that are not used by the public.

15. Adopt rules relating to acceptable workmanship standards.

16. Adopt rules relating to issuing permits to licensees, owners of units or other persons for the installation of manufactured homes, mobile homes, factory‑built buildings and accessory structures.

17. Adopt rules including a requirement that a permit shall be obtained before the installation of a mobile or manufactured home.

18. Establish standards for the permanent foundation of a manufactured home, mobile home or factory‑built building.

B. In adopting rules pursuant to subsection A, paragraph 3 of this section, the board shall consider for adoption any amendments to the codes and standards referred to in subsection A, paragraphs 1 and 2 of this section. If the board adopts the amendments to such codes and standards, the director department shall notify the manufacturers licensed pursuant to article 4 of this chapter ninety or more days prior to before the effective date of such amendments.

C. Chapter 6 of this title does not apply to the setting of fees under subsection A, paragraph 4 of this section.

D. Rules adopted pursuant to subsection A, paragraph 14 of this section shall be standard throughout this state and may be enforced by the local enforcement agencies on installation to ensure a standard of safety. The board may make an exception to the standard if, on petition by a local jurisdiction participating in the installation inspection program, local conditions justify the exemption or it is necessary to protect the health and safety of the public. On its own motion, the board may revise or repeal any exception. END_STATUTE

Sec. 12. Repeal

Section 41-4021, Arizona Revised Statutes, is repealed.

Sec. 13. Section 41-4023, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4023. General powers and duties

The director shall appoint the deputy director who shall, under the authority and direction of the director:

1. Administer the provisions of this article.

2. Provide personnel, clerical, accounting, fiscal and budget support for the department and other functions designated by the director.

3. 1. Establish licensing and regulation procedures in accordance with this article and issue certification documents for compliance with the licensing and bonding requirements of this article.

4. 2. Issue certification insignia certificates to indicate compliance with the construction and installation requirements of article 2 3 of this chapter.

5. 3. Provide for investigative support, enforcement, penalty procedures, hearings and rehearings in accordance with this chapter.

6. 4. Establish field offices for the department as required.

7. 5. Issue permits to licensees, owners of units and other persons for the installation of manufactured homes, mobile homes and factory‑built buildings and the rehabilitation of mobile homes. END_STATUTE

Sec. 14. Repeal

Section 41-4024, Arizona Revised Statutes, is repealed.

Sec. 15. Section 41-4025, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4025. Qualifications and requirements for license

A. A manufacturer, dealer, broker, salesperson or installer license shall be issued by the director.

B. The director shall:

1. Classify and Qualify applicants for a license.

2. Conduct such investigations as the director deems necessary.

3. Establish and administer written examinations for the applicable class license classifications.

C. The director may establish experience requirements for installers of manufactured homes, mobile homes, residential factory‑built buildings and accessory structures.

D. To obtain a license pursuant to this article, the applicant shall submit to the director a notarized application on forms prescribed by the office department together with the required license fee. Such application shall contain the following information:

1. A designation of the classification of license sought by the applicant.

2. The name, birth date and address of an individual applicant.

3. If the applicant is a partnership, the name, birth date and address of all partners with a designation of any limited partners.

4. If the applicant is a corporation, association or other organization, the names, birth dates and addresses of the president, vice‑president vice president, secretary and treasurer.

5. For all licenses, except those for salespersons, the name, birth date and address of the qualifying party. The qualifying party must reside within the state of the principal place of the licensee's business and shall not act in the capacity of a qualifying party for more than one license in the same classification.

6. If the applicant is a corporation, association or other organization, evidence that the corporation, association or other organization is in good standing with the Arizona corporation commission.

7. Whether the owner, if the applicant is a sole proprietorship, all partners, if the applicant is a partnership, all officers, if the applicant is a corporation or other type of association, the managers or managing members, if the applicant is a limited liability company, the general partner, if the applicant is a limited partnership, or the individual, if the applicant is a salesperson, has ever been charged or convicted of a felony, or has ever received an adverse final decision in a civil action alleging fraud or misrepresentation, and, if so, the nature of the action and the final disposition of the case.

8. For corporations, the name and address of a statutory agent appointed by the licensee on whom legal notices, summonses or other processes may be served, which service shall be deemed personal service on the licensee.

9. If it is an application for a salesperson's license, the applicant shall designate an employing dealer or broker and the application shall include the signature of the qualifying party or the qualifying party's designee.

10. Other information as the director may deem necessary.

E. Prior to Before the issuance of any license pursuant to this article, the owner, if the applicant is a sole proprietorship, all partners, if the applicant is a partnership, the general partner, if the applicant is a limited partnership, the president, vice‑president vice president, secretary, and treasurer, if the applicant is a corporation or other type of association, the manager or managing members, if the applicant is a limited liability company, the individual, if the applicant is a salesperson, and the qualifying party shall be of good character and reputation and shall submit a fingerprint card for background analysis. Lack of good character and reputation may be established by showing that such person has committed any act which that, if committed by any licensee, would be grounds for suspension or revocation of such license.

F. To obtain a license pursuant to this article, a person shall not have had a license refused or revoked within one year prior to before the date of the application nor have engaged in the business without first having been licensed nor shall a person act as a licensee between the filing of the application and actual issuance of the license. For the purposes of this subsection, "person" means an applicant, an individual, a qualifying party, any partner of a partnership, any manager or managing member of a limited liability company, or any officer, director, qualifying party or owner of forty percent or more of the stock or beneficial interest of a corporation.

G. Prior to Before issuance of a dealer, broker or installer license, the qualifying party, in addition to meeting the requirements provided in subsection D of this section, shall successfully show, by written examination within three attempts, qualification in the kind of work or business in which the applicant proposes to engage. Before the issuance of an installer license, the qualifying party shall also provide the department with evidence of successful completion of the online installer course that is administered by the manufactured housing educational institute and proof of three years of practical or field experience or training that is deemed acceptable by the department.

H. No A license shall not be issued to a minor or to any partnership in which one of the partners is a minor.

I. Every salesperson who holds an active license shall maintain on file with the office department a current residence address and shall notify the office department within five working days of any change of address, of any discontinued employment, and where, if anywhere, the salesperson is currently working.

J. The license of a salesperson who is no longer employed by the dealer of record is deemed inactive., and The salesperson shall turn in the license to into the office department until the salesperson is employed by another dealer and a written notification of the change has been received by the office department. On notification, the office department shall return the license to the salesperson. END_STATUTE

Sec. 16. Section 41-4026, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4026. Issuance of a license

A. On receipt by the director of the nonrefundable fee required by this article and an application furnishing complete information as required by the director and on the applicant taking and passing the applicable examination required by section 41‑4025, the director shall issue a conditional license to the applicant, pending completion of the background analysis, permitting the applicant to engage in business pursuant to this article for one year.

B. Pursuant to the agreement for conditional license, the applicant shall agree to a revocation of the conditional license if it appears, on review of the background analysis, that the applicant has misrepresented its background. The applicant shall also agree to waive any right the applicant may have to a stay of the effectiveness of any order of revocation of the conditional license, the right to notice of hearing and the right to a hearing before the revocation of the license.

C. The agreement for conditional license does not prohibit the applicant from making a written demand for a hearing on the order of revocation pursuant to chapter 6, article 10 of this title. Pending the hearing, the applicant shall not continue to transact business under the conditional license.

D. On completion Depending on the results of the background analysis, the director may issue either a permanent or a probationary license, depending on the results of the background analysis either revoke the conditional license or deem the license as granted without further condition.

E. Licenses License certificates issued pursuant to this article and any annual renewals shall be signed by the director or the director's designated representative and by the licensee. The license is nontransferable and satisfactory evidence of the possession shall be exhibited by the licensee on demand. The license held by the licensee shall be posted in a conspicuous place on the premises where any business is being performed. A license card shall be carried by the person doing the work away from the premises where the license is posted. The license number shall be written on any contract entered into by the licensee.

F. If an application for a license is denied or if the applicant fails to supply complete and correct required information within ninety days or fails to pass the required written examination within ninety days after filing or if an application for renewal is not completed by the expiration date or if any applicant requiring examination after having been notified by letter of the date to appear fails to appear for the examination within ninety days from the date of filing the application, the fee paid by the applicant on filing the application is forfeited and the application is terminated. A reapplication for a license shall be accompanied by the fee prescribed by the director.

G. If, before the issuance of the license, information brought to the attention of the director concerning the qualifications of the applicant is such that in the director's discretion it may be proper to deny the license, the director may notify the applicant that the license is denied and that the applicant may request in writing a hearing if the applicant so desires.

H. The licensee may not engage in the sale of units, either new or used, unless the licensee maintains an office where the records are available for inspection and the location is listed on the license application as the principal place of business. END_STATUTE

Sec. 17. Section 41-4027, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4027. Renewal of licenses; license status

A. Licenses issued under this article shall expire one year after the date of issuance. An application for renewal of any current license with evidence of a valid bond or cash deposit when accompanied by the required fee and received by the director before the expiration date shall authorize the licensee to operate until actual issuance of the renewal license for the ensuing year.

B. A license that expires may be reactivated and renewed within one year of its expiration by filing the required renewal application, signed by the licensee or qualifying party for a business licensee, evidence of a valid bond and payment of a fee of one hundred twenty‑five percent of the amount required for that license class. When a license has been expired for more than one year for failure to renew, a new application for license shall be made and a new license issued pursuant to this article. If the license has been expired for more than one year, the fee required shall be two hundred percent of the fee required for that license class.

C. An applicant for renewal of a license issued pursuant to this article shall not be required to take a written examination.

D. A license is not transferable. Any change in the legal entity of a licensee that includes any change in the ownership of a sole proprietorship or a partner of a partnership or in the creation of a new corporate entity requires a new license.

E. A license may be cancelled canceled on the written request of the owner of a sole proprietorship, a partner of a partnership or, in the case of a corporation or a limited liability corporation, any person with written evidence of his authority to request the cancellation. A salesperson's license may be cancelled canceled on the written request of the salesperson. The director may refuse to accept voluntary cancellation of a license if good cause may exist for disciplinary action.

F. If possible, the licensee shall notify the director in writing of the disassociation of a qualifying party before the action, and in any event no later than five business days after the action. The licensee shall also notify the director as to who will be temporarily responsible for the operation of the business. The absence of a written designated qualifying party for sixty days is grounds for suspension of the license. If a person ceases to be the qualifying party for a licensee, the person shall notify the office department within five days.

G. An application for a new qualifying party shall include the completion of the prescribed forms, fingerprints and testing, if applicable, in accordance with sections 41‑4025 and 41‑4026.

H. A licensee may request the director, on forms prescribed by the director, to inactivate the licensee's current license for a period of not more than two years. In the absence of any disciplinary proceeding or disciplinary suspension and on payment of reasonable fees determined by the board the director may issue an inactive license certificate to the licensee if the licensee has turned in his license. The inactive license certificate may consist of an endorsement on the licensee's license stating that the license is inactive. The director may not refund any of the license renewal fee which a licensee paid before requesting inactive status. A licensee's license which that is not suspended or revoked and is inactive shall be reactivated as an active license on payment of the current year's renewal fee and thirty days' written notice to the director. No aN examination may not be required to reactivate an inactive license. If the license is not reactivated within two years, a new application for licensing must be made and the new license issued pursuant to this chapter. No a licensee may not inactivate the license more than once. The holder of an inactive license shall not work as a licensee until his the licensee's license is reactivated as an active license. The inactive status of a licensee's license does not bar any disciplinary action by the director against a licensee for any of the grounds stated in this chapter. END_STATUTE

Sec. 18. Section 41-4028, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4028. Exemptions

A. Any person engaged in installing manufactured homes, mobile homes or accessory structures and licensed in an appropriate category by the registrar of contractors pursuant to title 32, chapter 10, article 2 is exempt only from the licensing requirements of this article.

B. The requirements of this chapter applicable to dealers and brokers do not apply to persons performing the following transactions:

1. Real estate brokers and real estate salesmen licensed under section 32‑2122 who engage in activities proscribed by this chapter with respect to used manufactured homes, mobile homes, or factory‑built buildings or subassemblies if the manufactured home, mobile home, or factory‑built building or subassembly is listed in a contract for transfer of an interest in real property executed by its owner and is installed on the real property.

2. Receivers, trustees, administrators, executors, guardians or other persons appointed by or acting under the judgment of any court.

3. Public officers while performing their official duties.

4. Banks and other financial institutions, and their subsidiaries, and other corporations qualified to do business in this state, if they are proceeding as repossessors or liquidators, but only to the extent that they finance the sales transaction by which the repossessed property is liquidated or are a holder in due course with respect to the transaction.

5. A purchaser who sells no more than two factory‑built buildings, subassemblies, manufactured homes or mobile homes in any twelve month twelve‑month period.

C. For the purposes of this section, a manufactured home, mobile home, or factory‑built building or subassembly is used if it has been occupied for at least thirty consecutive days for its intended use or function by a bona fide homeowner, renter or other end user. END_STATUTE

Sec. 19. Section 41-4029, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4029. Bonds and cash deposits; requirements; fund

A. Before granting an original license, the director shall require of the applicant, except an applicant for salesperson or broker of manufactured homes, mobile homes or factory‑built buildings designed for use as residential buildings, a surety bond in a form acceptable to the director or a cash deposit pursuant to this section. A separate bond or cash deposit shall be required for each branch location of any licensed manufacturer or installer. No license shall be renewed unless the applicant's surety bond or cash deposit is in full force and effect. A change of location of a licensee's principal place of business requires a rider or endorsement to the existing bond and payment of the administrative function fee. The rider or endorsement shall indicate the new location and acceptance of claims for the previous location.

B. The bonds or cash deposit shall be in amounts prescribed by the board.

C. The surety bonds shall be executed by the applicant as principal with a corporation duly authorized to transact surety business in this state. Evidence of a surety bond shall be submitted to the director in a form prescribed by the director. The applicant may in the alternative establish a cash deposit in the amount of the bond with the state treasurer pursuant to the rules adopted by the director. The bond funds shall be deposited, pursuant to sections 35‑146 and 35‑147, in a special account to be known as the consumer recovery fund. The state treasurer shall invest and divest monies in the fund as provided by section 35‑313, and monies earned from investment shall be credited to the fund. Such cash deposits may be withdrawn, if there are no outstanding claims against them, two years after the termination of the license in connection with which the cash is deposited. The cash deposit may be withdrawn two years after the filing of a commercial surety bond as a replacement to the cash deposit.

D. The bond or deposit required by this section shall be in favor of the state for the benefit of any person covered by this subsection. The bond or deposit shall be subject to claims by:

1. Any consumer of a unit regulated by this chapter who enters into an agreement with any licensee, except a salesperson or broker of manufactured homes, mobile homes or factory‑built buildings designed for use as residential buildings, and is damaged by the failure of the principal to perform a sales or installation agreement or to perform repairs under a warranty.

2. The director, if the principal fails to pay any of the fees or costs which that the principal owes the office department.

E. Any person claiming against the bond or deposit, except the department, may maintain an action against the principal and the surety. Such principal's bond or deposit may be sued on in successive actions until the full amount is exhausted. No suit may be commenced on the bond or deposit after the expiration of two years after the date of sale or installation of the unit, whichever is later, on which the suit is based, except that the time for purposes of the claim for fraud shall be measured pursuant to section 12‑543.

F. The surety bond or deposit shall be continuous in form and shall contain the condition that the total aggregate liability of the surety or depository for all claims shall be limited to the face amount of the bond or depository irrespective of the number of years the bond or depository is in force. If the corporate surety desires to make payment without awaiting court action, the amount of the bond filed shall be reduced to the extent of any payment or payments made by the corporate surety in good faith. Any such payments shall be based on priority of written claims received by the corporate surety prior to court action. The surety bond or depository shall be continuous as long as the corporate surety or the depositor maintains the face amount of the bond or deposit. Failure to maintain the face amount of the bond or deposit constitutes a suspension of such license until the face amount of the bond or deposit is restored.

G. The corporate surety shall notify the director of the intent of the principal to cancel the bond and of any monies paid from the bond. On receipt by the director of notice to cancel a bond by any corporate surety, the director shall immediately notify the licensee who is the principal on the bond of the effective date of cancellation of the bond and that the licensee shall furnish a like bond or make cash deposit on or before the effective date of cancellation or the license shall be suspended. Notice to the licensee shall be by certified mail postage fully prepaid, addressed to the licensee's last address of record with the office department. The license shall be suspended on the date the bond is canceled unless a replacement bond or cash deposit in lieu of a bond is on file with the director.

H. The director and director shall have no personal liability for the performance of duties relating to the bond and cash deposit requirements of this section if such duties are performed in good faith. END_STATUTE

Sec. 20. Section 41-4030, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4030. Trust and escrow requirements; rules; exemptions

A. Beginning July 1, 2012, Each dealer or broker licensed pursuant to this article shall establish an independent escrow account with an independent financial institution or escrow agent authorized to handle such an account in this state as prescribed by title 6, chapter 7 or 8, for each transaction involving:

1. A new manufactured home.

2. A new factory-built building designed for use as a residential dwelling.

3. A manufactured home, mobile home or factory-built building designed for use as a residential dwelling that is previously owned and that has a purchase price of fifty thousand dollars or more.

B. For the purposes of subsection A of this section, a financial institution or escrow agent is independent if the individual or entity is not controlled by the licensee, a family member of the licensee or a business affiliated with the licensee and the licensee, family member or business affiliate does not have a majority interest in the financial institution or escrow agent.

C. The owner of a mobile home park who also is or owns a dealership licensed pursuant to this article to sell new units may sell a new manufactured home or a new factory-built building designed for use as a residential dwelling as a licensee without complying with subsection A of this section if all of the following apply:

1. The home will be sited in a mobile home park that is owned by the park owner.

2. At the time of the sale, the park owner has on file at the office of manufactured housing department the name and address of all mobile home parks owned by the park owner, the name, address and license number of the licensed dealership and documentation showing to the satisfaction of the office of manufactured housing department that the park owner either holds the license, owns a majority interest in the license or is controlled by an entity that holds a controlling interest in the license.

3. At the time of the sale, the licensed dealership has posted with the office of manufactured housing department a dealer bond in an amount of at least one hundred thousand dollars in a form satisfactory to the office of manufactured housing department covering sales by parks sharing common control.

D. Each dealer or broker who is licensed pursuant to this article and who sells new manufactured homes, mobile homes or factory‑built buildings designed for use as residential dwellings or a manufactured home, mobile home or factory-built building designed for use as a residential dwelling that is previously owned and that has a purchase price of less than fifty thousand dollars shall maintain a licensee's trust account or open an escrow account with a an independent financial institution or escrow agent located in this state and shall deposit all earnest money received for the sale of manufactured homes, mobile homes or factory‑built buildings designed for use as residential dwellings in such account. The department shall conduct an audit of each dealer's or broker's trust or escrow account, including any transactions with an independent escrow account, at least once every two years. Beginning July 1, 2012, A purchaser under this subsection of a mobile home, used manufactured home or used factory‑built building designed for use as a residential dwelling may request that the dealer or broker establish an independent escrow account and if such a request is made in writing no later than the time the purchase contract is signed, and the seller consents, the dealer or broker shall comply with this subsection by complying with subsection A of this section. A licensee handling a transaction under this subsection shall disclose to the purchaser, in writing and before or at the time the purchaser signs the purchase contract, that the purchaser may request in writing the use of an independent escrow account, and that the transaction will otherwise be handled through a trust account controlled by the licensee.

E. All dealers or brokers shall notify the director in writing when the trust or escrow account has been established by indicating the name and number of the account and the name and location of the financial institution used.

F. The dealer or broker, in writing, shall authorize the depository to release any and all information relative to trust or escrow accounts to the director or the director's agent, employee or deputy.

G. The dealer's or broker's earnest money receipt book shall reflect all earnest monies received and shall be at the minimum in duplicate and consecutively numbered.

H. All earnest monies shall be deposited in the escrow account or trust fund account no later than the close of the second banking business day after receipt.

I. The terms or instructions for any escrow account opened under subsection A or D of this section are deemed to be and enforceable as part of the purchase contract. All parties to the purchase contract and the licensee shall sign the terms and instructions. If practicable, the escrow terms or instructions shall be included in the purchase contract or stated in an addendum to the purchase contract. The licensee shall provide a copy of the purchase contract to the escrow agent even if the escrow terms or instructions are contained in a separate document. The licensee shall promptly provide the escrow account information to all parties to the purchase contract once the account is opened.

J. At a minimum, the escrow terms or instructions shall contain:

1. Identification of the escrow agent with information containing at least the name, address and telephone number of the escrow agent.

2. All conditions or requirements that affect or pertain to closing the escrow account and disbursement of the monies in the escrow account.

3. Any conditions or requirements where monies are to be disbursed from the escrow account in advance of the escrow account being closed.

4. Any conditions or requirements where additional monies or documents must be deposited with an escrow agent after the escrow account is opened.

K. A dealer or broker may deposit and maintain up to two hundred dollars in the trust account to offset service charges that may be assessed by the financial institutions institution.

L. Every deposit into a trust account shall be made with a deposit slip that identifies each transaction as follows:

1. The amount of deposit.

2. The names of all parties involved in the transaction. All receipts for monies deposited in escrow shall be made accountable by containing the same information.

M. A complete record shall be retained by the dealer's or broker's office of all earnest monies received. The record shall contain provisions for entering:

1. The amount received.

2. From whom the money was received.

3. The date of receipt.

4. The place of deposit.

5. The date of deposit.

6. The daily balance of the trust fund account deposit of each transaction.

7. When the transaction has been completed.

8. The date and payment for all goods and services the dealer has contracted to provide.

N. All earnest money deposited in the trust or escrow account shall be held in such account until one of the following is completed:

1. An application for title transfer has been made.

2. The transaction involved is consummated or terminated and a complete accounting is made.

1. The consummation of sale.

2. The termination of sale, including a complete accounting of all monies.

O. On completion pursuant to subsection N of this section, the earnest money deposit shall be conveyed to the lending institution or the dealer, broker, purchaser, seller, manufacturer or lienholder, whichever is applicable.

P. The dealer or broker shall retain true copies of the purchase agreements, earnest money receipts, depository receipts, evidence of delivery documents and evidence of consummation of sale or termination of sale for a period of three years.

Q. The deposits referred to in this section shall not be used for any purpose other than the transaction for which they were provided.

R. Notwithstanding any other provision of this section and except that this subsection does not apply to an independent escrow account established pursuant to subsection A of this section, before an event listed under subsection N of this section is completed, a licensed dealer may release trust account earnest monies to pay for flooring or inventory for the unit that is the subject of the transaction for which the earnest monies were provided. Either A licensed dealer or broker may release trust account earnest monies to pay other lawfully imposed interim loan amounts and charges imposed by a financial institution or other bona fide lender on the unit that is the subject of the transaction for which the earnest monies were provided. The dealer or broker shall not make any payment out of trust account monies pursuant to this subsection unless done in compliance with all of the following:

1. The payment is made no more than ten business days before the completion date pursuant to subsection N of this section.

2. The payment is made directly to the financial institution or other bona fide lender.

3. The payment is recorded in the dealer's or broker's records under this section and documented by a receipt, a payment record or any other evidence from the financial institution or lender.

4. If the transaction is terminated, the dealer or broker replaces the amount of the payment in the trust account within three business days after receiving written notification of the termination.

This subsection does not affect any other rights or obligations between the purchaser and the licensed dealer or broker.

S. The board shall adopt separate rules for dealer trust and escrow accounts and broker trust and escrow accounts. At a minimum, these rules shall contain trust and escrow account requirements for the following:

1. Recordkeeping.

2. Administration.

3. Service fees or charges.

4. Deposits.

5. Advances or payments out of trust and escrow accounts.

6. Closing or termination of sales transactions.

7. Auditing or investigation of trust or escrow account complaints.

T. This section shall not apply to a real estate broker or salesperson licensed pursuant to section 32‑2122 and pursuant to this article when the unit is sold in conjunction with real estate. END_STATUTE

Sec. 21. Section 41-4031, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4031. Complaints; citation; failure to respond

A. The office department shall issue a citation on failure to respond or on the verified written complaint of a purchaser pursuant to section 41‑4004, subsection B A, paragraph 9 and shall issue a citation directing the licensee, within ten days after service of the citation on the licensee, to appear by filing with the office department a verified answer to the complaint showing cause why the license should not be revoked or suspended. The director, after conducting an investigation pursuant to section 41‑4039, may issue a citation on the director's own initiative.

B. Failure of the licensee to answer shall be deemed an admission by the licensee of the cited complaint or failure to respond as charged in the citation, and the office department may suspend or revoke such license without a hearing.

C. A person served with a citation or with a cease and desist order by the state fire marshal may request a hearing pursuant to chapter 6, article 10 of this title. END_STATUTE

Sec. 22. Section 41-4036, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4036. Repairs; complaints

A. Within ninety days after the end of the cosmetic complaint period the dealer or manufacturer shall repair or replace cosmetic, superficial or minor matters discovered on the walk‑through unless an item necessary for the repair or replacement is unavailable and written notice of that fact is provided to the purchaser.

B. For cosmetic, superficial or minor matters found after the walk‑through and before the one hundred twenty‑day deadline, the purchaser shall notify the dealer in writing before a complaint may be filed, except if there are extenuating circumstances, such as serious illness, incapacity or death. The dealer or manufacturer shall replace or repair these items within ninety days after the end of the cosmetic complaint period.

C. The board shall adopt rules establishing procedures for scheduling repair and replacement of complaint items.

D. The purchaser may file a complaint with the office of manufactured housing department on matters covered by this section if the complaint is filed within the twelve‑month period prescribed by sections 41‑4004 and 41‑4031 and the licensee failed to repair or replace the items within the repair and replacement period or the repair or replacement does not comply with adopted codes or workmanship standards. END_STATUTE

Sec. 23. Section 41-4039, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4039. Grounds for disciplinary action

The director may, on the director's own motion, and shall, on the complaint in writing of any person, cause to be investigated by the office department the acts of any manufacturer, dealer, broker, salesperson or installer licensed with the office department and may temporarily suspend or permanently revoke any license issued under this article, impose an administrative penalty or place on probation any licensee, if the holder of the license, while a licensee, is guilty of or commits any of the following acts or omissions:

1. Failure in any material respect to comply with this article or article 3 of this chapter.

2. Violation of any rule that is adopted by the board and that pertains to the construction of any unit or of any rule that is adopted by the board and that is necessary to effectively carry out the intent of this article, article 3 of this chapter or the laws of the United States or of this state.

3. Misrepresentation of a material fact by the applicant in obtaining a license.

4. Aiding or abetting an unlicensed person or knowingly combining or conspiring with an unlicensed person to evade this article or article 3 of this chapter, or allowing one's license to be used by an unlicensed person or acting as an agent, partner or associate of an unlicensed person with intent to evade this article or article 3 of this chapter.

5. Conviction of a felony.

6. The doing of a wrongful or fraudulent act by a licensee that relates to this article or article 3 of this chapter, including, beginning July 1, 2012, failure to comply with section 41‑4030, subsection A, or the doing of any other wrongful or fraudulent act in conjunction with the sale, transfer or relocation of a mobile home in this state.

7. Departure from or disregard of any code or any rule adopted by the board.

8. Failure to disclose or subsequent discovery by the office department of facts that, if known at the time of issuance of a license or the renewal of a license, would have been grounds to deny the issuance or renewal of a license.

9. Knowingly entering into a contract with a person not duly licensed in the required classification for work to be performed for which a license is required.

10. Acting in the capacity of a licensee under any license issued under this article in a name other than as set forth on the license.

11. Acting as a licensee while the license is under suspension or in any other invalid status.

12. Failure to respond relative to a verified complaint after notice of such complaint.

13. Violation of title 28, chapter 10 or rules adopted pursuant to title 28, chapter 10, except for the licensing requirements of sections 28‑4334, 28‑4335, 28‑4361, 28‑4362, 28‑4364, 28‑4401 and 28‑4402.

14. False, misleading or deceptive sales practices by a licensee in the sale or offer of sale of any unit regulated by this article or article 3 of this chapter.

15. Failure to remit the consumer recovery fund fee pursuant to section 41‑4042.

16. Acting as a salesperson while not employed by a dealer or broker.

17. As a salesperson, representing or attempting to represent a dealer or broker other than by whom the salesperson is employed.

18. Acting beyond the scope of activity authorized by the salesperson's license classification of the employing dealer.

18. 19. Failure by a salesperson to promptly place all cash, checks and other items of value and any related documents received in connection with a sales transaction in the care of the employing dealer or broker.

19. 20. Failure to provide all agreed on goods and services.

20. 21. Failure to manufacture or install in a workmanlike manner all subassemblies, units and accessory structures that are suitable for their intended purpose.

21. 22. Failure of the licensee to work only within the scope of the license held.

22. 23. An action by a licensee, who is also a mobile home park owner, manager, agent or representative, that restricts a resident's or prospective resident's access to buyers, sellers or licensed dealers or brokers in connection with the sale of a home or the rental of a space, that the department finds constitutes a violation of section 33‑1434, subsection B or section 33‑1452, subsection F or that violates any law or regulation relating to fair housing or credit practices. END_STATUTE

Sec. 24. Section 41-4040, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4040. Reports by dealers to department of revenue and county assessor

A. Every dealer or broker who acquires or sells a previously titled manufactured home or mobile home, as defined in section 42‑19151, shall submit a written report of all such acquisitions and sales to the department of revenue and to the county assessor of the county where such dealer or broker is located. Such report shall be submitted by the fifteenth day of each month for the period of the previous calendar month and shall include:

1. The manufacturer, brand name or model, size, factory list price, total selling price and serial number of such manufactured home or mobile home.

2. The name and address of the person from whom such manufactured home or mobile home was acquired and the last previous location of such manufactured home or mobile home.

3. The name and address of the person to whom such manufactured home or mobile home was sold.

4. The new location of such manufactured home or mobile home if such location is known to the dealer or broker.

B. Every dealer and broker shall comply with the reporting provisions of this section. The information required in subsection A of this section shall be forwarded by dealers and brokers of manufactured homes and factory‑built buildings to the office department by the fifteenth day of the month after the reporting period or a statement that no sales have occurred for that month.

C. Each dealer and broker of manufactured homes shall also make and maintain the records and make the reports required pursuant to this article.

D. Before the sale of a manufactured home each dealer or broker shall convey notice in writing to the prospective buyer that the utility service facilities for manufactured home spaces are not standardized and compatibility between a chosen manufactured home space and a manufactured home to be purchased is the buyer's responsibility. Before the sale of a used manufactured home each dealer or broker shall notify the prospective buyer in writing of the existence and amount of any tax lien on record against the unit.

E. The dealer or broker shall provide a notification form to the buyer, as approved by the board, part of which shall contain the buyer's signature and other information to be completed by the dealer or broker which that when forwarded to the office department constitutes compliance with the reporting requirements of subsection B of this section. END_STATUTE

Sec. 25. Section 41-4041, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4041. Consumer recovery fund

A. The consumer recovery fund is established. The board director shall administer the fund.

B. On notice from the board director, the state treasurer shall invest and divest monies in the fund as provided by section 35‑313, and monies earned from investment shall be credited to the fund.

C. The monies earned from investment can may be used for the same purposes as all other monies deposited in the fund.

D. Recovery from the consumer recovery fund is limited to actual or compensatory damages, including costs but excluding interest or attorney fees.

E. Recovery from the consumer recovery fund is not limited by the consumer's right, if any, to also claim against a holder of a retail sales contract or promissory note which that is secured by the property that is the subject matter of the claim. END_STATUTE

Sec. 26. Section 41-4042, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4042. Funding and assessments

A. A dealer or broker of manufactured homes, mobile homes or factory‑built buildings designed for use as residential dwellings shall pay, in addition to the license or renewal fee, a fee established by the board director of not to exceed fifty dollars for each unit that is sold and that is subject to section 41‑4030, subsection D, for deposit into the consumer recovery fund. The fee is payable to the office department by the fifteenth day of the month following the month in which the sale is consummated.

B. Chapter 6 of this title does not apply to the setting of fees under this section.

C. An amount not to exceed seventy‑five percent of the previous fiscal year's interest earned on the consumer recovery fund may be expended by the director, with the approval of the board. The expenditure shall be used for consumer and licensee education in connection with the manufactured housing and factory‑built building industry, and all monies up to a maximum of fifty thousand dollars remaining unexpended and unencumbered at the end of each fiscal year may be used for consumer and licensee education in succeeding fiscal years and do not revert to the consumer recovery fund. END_STATUTE

Sec. 27. Section 41-4043, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4043. Recovery from fund; claim against licensee; subrogation; appeal; statute of limitations

A. If any consumer who is buying or selling the consumer's home uses the services of a licensed dealer or broker of manufactured homes, mobile homes or factory‑built buildings designed for use as residential buildings and is damaged as a result of an act or omission by a licensed dealer or broker of manufactured homes, mobile homes or factory‑built buildings designed for use as residential buildings that constitutes a violation of section 41‑4030, or rules adopted pursuant to that section, and the sale is subject to section 41‑4030, subsection D, that consumer may file a claim with the office department for payment from the consumer recovery fund. The claim shall be verified by the office department.

B. If any consumer of manufactured homes, mobile homes or factory‑built buildings designed for use as residential buildings is damaged by the failure of the principal to perform a sales agreement or to perform repairs under a warranty the consumer may file a claim with the office department for payment from the consumer recovery fund. The claim shall be verified by the office department.

C. On verification of the claim for payment, the director shall provide for a hearing pursuant to chapter 6, article 10 of this title.

D. The board director shall pay from the consumer recovery fund whatever sum the administrative law judge finds payable on the claim. A decision granting a claim shall include an order suspending the license of the licensee on whose account the claim was filed. Such a license shall remain on suspension suspended until the licensee has repaid in full, plus interest at the rate of ten percent per year, the amount paid from the consumer recovery fund on the licensee's account.

E. Any party aggrieved by the administrative law judge's decision may apply for a rehearing by filing with the director a motion in writing pursuant to chapter 6, article 10 of this title. The filing of a motion for rehearing shall suspend the operation of the administrative law judge's order pending the decision of the director on the rehearing.

F. Except as provided in section 41‑1092.08, subsection H, any person aggrieved by a final administrative decision may seek judicial review pursuant to title 12, chapter 7, article 6.

G. The consumer recovery fund has a claim against the licensee on whose account a claim was granted or any other person who caused or contributed to a claim paid by the consumer recovery fund for the amount paid plus costs, necessary expenses and reasonable attorney fees.

H. The director is subrogated to the claim of the consumer recovery fund against the bond and other assets of the licensee. The director shall deposit any amount recovered into the consumer recovery fund.

I. If, at any time, the money deposited in the consumer recovery fund is insufficient to satisfy any duly authorized claim or portion of a claim, the board director, when sufficient money has been deposited in the consumer recovery fund, shall satisfy such unpaid claims or portions of claims in the order that such claims or portions of claims were originally filed.

J. A consumer pursuant to subsection A or B of this section is barred from commencing an application for payment from the consumer recovery fund later than two years from the date of sale or date of installation, whichever is later. END_STATUTE

Sec. 28. Section 41-4046, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4046. Enforcement powers of director; civil and administrative penalties

A. The director, personnel of the office department and personnel under contract to the office department, on presentation of credentials, shall be permitted to enter and inspect premises where units regulated by this chapter are manufactured, sold or installed as the director may deem appropriate to determine if any person has violated this chapter. No person licensed by the office department may refuse to admit the director or the personnel of the office department or personnel under contract if the proper credentials are presented and the inspection is made at a reasonable time.

B. If the director has reasonable cause to believe a unit is being offered for sale by a party required to be licensed but not licensed as a dealer or broker by the office department or is in violation of this chapter, or the rules, regulations or standards adopted pursuant to this chapter, the office department shall serve on the manufacturer, dealer, broker or installer a notice of violation, which may be affixed to the unit in violation and, if affixed to the unit, shall not be removed by anyone without the authorization of the office department.

C. If there is reasonable cause to believe, from information furnished to the director or from an investigation instituted by the director, that any person is engaged in a business regulated by this article without being licensed as required by law, the director shall issue and serve on the person, by certified mail, a cease and desist order requiring the person immediately, on receipt of the notice, to cease and desist from engaging in such business. On failure of such person to comply with the order, the director shall file an action in the superior court in Maricopa county restraining and enjoining the person from engaging in such business. The court in the action shall proceed as in other actions for injunctions.

D. If in the judgment of the director any person has engaged, or is about to engage, in any acts or practices that constitute, or will constitute, a violation of this chapter, the rules, regulations or standards adopted pursuant to this chapter or an order issued pursuant to this chapter, the director may make application to the appropriate court for an order enjoining such acts or practices. On a showing by the director that such person has engaged in, or is about to engage in, any such acts or practices, an injunction, restraining order or such other order as may be appropriate shall be granted by such court without bond. On a showing by the director that a licensee has wrongfully withdrawn, or is about to wrongfully withdraw, funds required to be held in the licensee's trust account, an injunction, restraining order or such other order as may be appropriate to prevent a licensee from wrongfully withdrawing trust account monies shall be granted by the court. On granting a permanent injunction, the court may impose a civil penalty not exceeding one thousand dollars for each violation.

E. In any investigation, proceeding or hearing that the director may institute, conduct or hold under this article, the director, or a representative designated by the director, may administer oaths, certify to official acts, issue subpoenas for attendance of witnesses and production of books, papers and records and exercise the same powers in this regard as conferred on public officers by section 12‑2212.

F. After any hearing that the director may institute, conduct or hold under this article, the director or a representative designated by the director may impose an administrative penalty in an amount of not to exceed one thousand dollars for each violation. All monies collected pursuant to this subsection shall be deposited in the state general fund.

G. Beginning July 1, 2012, The director may refer to the attorney general or a county attorney for criminal or civil investigation the results of any investigation that indicate the existence of the elements of fraud, including investigative information regarding any person or entity that, although not a licensee under this article, has a business or other relationship to a licensee or to a manufactured home transaction under this article.

H. If an inspection reveals that a mobile home entering this state for sale or installation is in violation of this chapter, the office department may order its use discontinued and the mobile home or any portion of the mobile home vacated. The order to vacate shall be served on the person occupying the mobile home and copies of the order shall be posted at or on each exit of the mobile home. The order to vacate shall include a reasonable period of time in which the violation can be corrected. A person shall not occupy or use a mobile home in violation of an order to vacate.

I. If construction, rebuilding or any other work is performed in violation of this chapter or any rule adopted pursuant to this chapter, the office department may order the work stopped. The order to stop work shall be served on the person doing the work or on the person causing the work to be done. The person served with the order shall immediately cease the work until authorized by the office department to continue. END_STATUTE

Sec. 29. Section 41-4047, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4047. Unlawful acts

It is unlawful for any person to:

1. Manufacture manufactured homes, or factory‑built buildings or subassemblies in this state or for delivery or sale in this state unless such person is licensed as a manufacturer by the office department.

2. Engage in the business of installing manufactured homes, mobile homes or accessory structures unless such person is licensed as an installer by the office department.

3. Engage in the business of a salesperson of manufactured homes, mobile homes or factory‑built buildings unless the person is licensed as a salesperson by the office department.

4. Engage in the business of contracting to sell any new or used unit or subassemblies regulated by this article or otherwise act in the capacity of a dealer or broker unless such person is licensed as a dealer or broker by the office department.

5. Make alterations to or reconstruct any manufactured homes or factory‑built buildings unless such person is licensed or certified. END_STATUTE

Sec. 30. Section 41-4048, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4048. Violation; classification; penalty

A. No A person required to be licensed pursuant to this article may not sell or offer to sell in this state any manufactured home, or factory‑built building or subassembly unless the proper state insignia certificate or HUD label is affixed to such unit.

B. No A person required to be licensed pursuant to this article may not manufacture for delivery, sell or offer to sell in this state any manufactured home, or factory‑built building or subassembly unless the unit and its components, systems and appliances have been constructed and assembled in accordance with the standards and rules adopted pursuant to this chapter.

C. A person shall not occupy or otherwise use a mobile home that has been brought into this state or move a mobile home from one mobile home park in this state to another mobile home park in this state unless it meets the standards adopted pursuant to this chapter and displays the proper state insignia certificate. A mobile home that is rehabilitated in accordance with rehabilitation rules adopted by the department and receives an insignia of approval a certificate shall be deemed by a county or municipality to be acceptable for relocation into an existing mobile home park. This subsection does not apply to a person bringing a mobile home into this state as a tourist.

D. A person shall not advertise or offer for sale a mobile home that has been brought into this state unless it meets the standards adopted pursuant to this chapter and displays the proper state insignia certificate.

E. No A person may not remove or cause to be removed an insignia of approval a certificate or a notice of violation without prior authorization of the office department.

F. A person shall not occupy or use a mobile home in violation of an order to vacate issued pursuant to section 41‑4004, subsection B A, paragraph 6.

G. Except as provided in subsections I and J of this section, a person who violates this chapter, or any such rule or standard, is guilty of a class 2 misdemeanor.

H. The director, after notice and a hearing pursuant to section 41‑4031, subsection A, may deny the issuance of a license or revoke or suspend the license of, impose an administrative penalty on or place on probation any manufacturer, dealer, broker, salesperson or installer who has violated this chapter or any standards and rules adopted pursuant to this chapter.

I. Any manufacturer, dealer, broker, salesperson or installer who knowingly violates this chapter or the rules adopted pursuant to section 41‑4010, subsection A, paragraph 1, 2, 9 or 10 or any person who knowingly provides false information to seek reimbursement of expenses under section 41‑4008 is guilty of a class 1 misdemeanor. Each violation of this chapter shall constitute a separate violation with respect to each failure or refusal to allow or perform an act required by this chapter, except that the maximum fine may not exceed one million dollars for any related series of violations occurring within one year from after the date of the first violation.

J. An individual or a director, officer or agent of a corporation who knowingly violates this chapter or the rules adopted pursuant to this chapter in a manner which that threatens the health or safety of any purchaser is guilty of a class 1 misdemeanor.

K. A manufacturer, dealer, or salesperson or broker shall not knowingly sell a unit regulated by this chapter to an unlicensed person for the purpose of resale, nor shall a dealer offer for sale or sell a new unit manufactured by an unlicensed person.

L. In addition to any other obligations imposed by law or contract during the term of a listing agreement, a licensee who has agreed to act as an agent to offer a mobile home, manufactured home or factory‑built building for sale shall promptly submit all offers to purchase the listed unit from any source to the client. The offers shall be in writing and signed and dated by the party making the offer and the client on receipt. A copy of the executed document shall be maintained as part of the record of sales.

M. No A licensee, owner or other persons may not manufacture, alter, reconstruct or install units regulated by this chapter, unless it is accomplished in a workmanlike manner in accordance with the rules adopted pursuant to this chapter and is suitable for the intended purpose. END_STATUTE

Sec. 31. Repeal

Section 41-4049, Arizona Revised Statutes, is repealed.

Sec. 32. Section 41-4062, Arizona Revised Statutes, is amended to read:

START_STATUTE41-4062. Hearing; rights and procedures; definitions

A. A person that is subject to title 33, chapter 11 or a party to a rental agreement entered into pursuant to title 33, chapter 11 may petition the department for a hearing concerning violations of the Arizona mobile home parks residential landlord and tenant act by filing a petition with the department and paying a nonrefundable filing fee in an amount to be established by the director. All monies collected shall be deposited in the state general Arizona department of housing program fund established by section 41‑3957 and are not refundable.

B. The petition shall be in writing on a form approved by the department, list the complaints, be signed by or on behalf of the persons filing and include their addresses, state that a hearing is desired and be filed with the department.

C. On receipt of the petition and the filing fee, the department shall mail to the named respondent by certified mail a copy of the petition along with notice that a response showing cause, if any, why the petition should be dismissed is required within twenty days after mailing of the petition.

D. After receiving the response, the director or the director's designee shall promptly review the petition for hearing and, if justified, refer the petition to the office of administrative hearings. The director may dismiss a petition for hearing if it appears to the director's satisfaction that the disputed issue or issues have been resolved by the parties.

E. Failure of the respondent to answer is deemed an admission of the allegations made in the petition, and the director shall issue a default decision.

F. Informal disposition may be made of any contested case.

G. Either party or the party's authorized agent may inspect any file of the department that pertains to the hearing if the authorization is filed in writing with the department.

H. At a hearing conducted pursuant to this section, a corporation may be represented by a corporate officer, employee or contractor of the corporation who is not a member of the state bar if:

1. The corporation has specifically authorized the officer, employee or contractor of the corporation to represent it.

2. The representation is not the officer's, employee's or contractor of the corporation's primary duty to the corporation but is secondary or incidental to the officer's, employee's or contractor of the corporation's, limited liability company's, limited liability partnership's, sole proprietor's or other lawfully formed and operating entity's duties relating to the management or operation of the corporation.

I. For the purposes of this section:

1. "Department" means the Arizona department of housing.

2. "Director" means the director of the department. END_STATUTE

Sec. 33. Section 42-15203, Arizona Revised Statutes, is amended to read:

START_STATUTE42-15203. Affidavit of affixture

A. A person who owns a mobile home that is permanently affixed to real property may file an affidavit of affixture with the county recorder of the county in which the real property is located.

B. An affidavit of affixture shall contain all of the following:

1. The vehicle identification numbers of the mobile home.

2. The legal description of the real property to which the mobile home has been affixed.

3. A statement that the mobile home has not previously been assessed and taxed in this state as personal property or the name and address of the person to whom the last tax statement for the mobile home was sent and the location of the mobile home when it was last taxed.

4. The name of the holder of any security interests in the mobile home that are not terminated by consent of the secured party contained on the affidavit of affixture pursuant to subsection C of this section and the original principal amount secured by the security interest.

5. As an attachment, the department of transportation's receipt issued pursuant to section 28‑2063, subsection A, paragraph 3.

C. The recording of an affidavit of affixture does not impair the rights of any holder of a perfected security interest in the mobile home unless the affidavit of affixture contains the acknowledged consent of the secured party to the termination of the security interest. If a secured party so consents, that security interest terminates when the affidavit of affixture is recorded.

D. If an affidavit of affixture is submitted for recording on a mobile home entering this state for sale or installation, a certificate of compliance or waiver issued by the office of manufactured Arizona department of housing is required and shall be submitted with the affidavit of affixture.

E. If a release of a security interest that, according to its terms, recites that it secures an obligation having a stated indebtedness not greater than five hundred thousand dollars exclusive of interest has not been executed and recorded within sixty days of full satisfaction of the obligation secured by the security interest, a title insurer as defined in section 20‑1562 may prepare, execute and record a full release of the security interest. At least thirty days before issuing and recording a release pursuant to this subsection, the title insurer shall mail by certified mail with postage prepaid, return receipt requested, to the holder of the security interest contained in the affidavit of affixture at the last known address shown of record and to any persons who according to the records of the title insurer received payment of the obligation at the address shown in the records, a notice of its intention to release the security interest accompanied by a copy of the release to be recorded. The release shall set forth:

1. The name of the holder of the security interest or any successors in interest of record of the security interest and, if known, the name of any servicing agent.

2. The name of the owner of the property shown on the affidavit of affixture.

3. The name of the current record owner of the property.

4. The recording reference to the affidavit of affixture.

5. The date and amount of payment, if known.

6. A statement that the title insurer has actual knowledge that the obligation secured by the security interest has been paid in full.

F. The release of security interest may be executed by a duly appointed attorney‑in‑fact of the title insurer, but such delegation does not relieve the title insurer from any liability pursuant to this section.

G. A release issued pursuant to subsection E of this section is entitled to recordation and, when recorded, constitutes a full release of security interest.

H. In addition to any other remedy provided by law, a title insurer preparing or recording the release of security interest pursuant to subsection E of this section is liable to any party for actual damage, including attorney fees, that any person may sustain by reason of the issuance and recording of the release of security interest.

I. The title insurer shall not record a release of security interest if, before the expiration of the thirty day thirty‑day period specified in subsection E of this section, the title insurer receives a notice from the holder or servicing agent that states that the security interest continues to secure an obligation.

J. The title insurer may charge a reasonable fee for services to the owner of the land or other person requesting a release of security interest, including search of title, document preparation and mailing services rendered, and in addition may collect official fees.

K. A mobile home identified in an affidavit of affixture recorded pursuant to section 33‑1501 shall be assessed as personal property. START_STATUTE