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ARIZONA STATE SENATE
Fifty-Fourth Legislature, Second Regular Session
short-term rental properties; classification
Purpose
Bifurcates the classification of leased or rented residential property based on the length of the rental period.
Background
Class 1 property consists of properties of mining, telecommunication companies, utilities, standing timber, airport fuel delivery, oil and gas production, pipelines, shopping centers, golf courses and most other commercial uses (A.R.S. § 42-12001).
Class 4 property includes real and personal property and improvements to property that are used as non-primary residential property and leased or rented residential property (A.R.S. § 42-12004).
If the change in property tax classification of residential rental property affects the revenue collected from property tax, there may be a fiscal impact to the state General Fund.
Provisions
1. Classifies, as class 1 property, real and personal property and improvements that are used for residential purposes, that are solely leased or rented to lodgers for periods of less than 30 days and that are valued at full cash value, except:
a) property occupied by the owner of the property as their primary residence and included in class 3 property; and
b) property that is leased or rented for residential purposes and included in class 4 property.
2. Classifies, as class 4 property, real and personal property and improvements that are used for residential purposes and that are solely leased or rented to lodgers for periods of 30 days or more.
3. Makes technical changes.
4. Becomes effective on the general effective date.
Prepared by Senate Research
February 7, 2020
MG/gs