HB2412 - 561R

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

Section 1. Section 33-808, Arizona Revised Statutes, is amended to read:

START_STATUTE33-808. Notice of trustee's sale

A. The trustee shall give written notice of the time and place of sale legally describing the trust property to be sold by each of the following methods:

1. Recording a notice in the office of the recorder of each county where the trust property is situated.

2. Giving notice as provided in section 33-809 to the extent applicable.

3. Posting a copy of the notice of sale, at least twenty days before the date of sale in some conspicuous place on the trust property to be sold, if posting can be accomplished without a breach of the peace. If access to the trust property is denied because a common entrance to the property is restricted by a limited access gate or similar impediment, the property shall be posted by posting notice at that gate or impediment. Notice shall also be posted at one of the places provided for posting public notices at any building that serves as a location of the superior court in the county where the trust property is to be sold. Posting is deemed completed on the date the trust property is posted. The posting of notice at the superior court location is deemed a ministerial act.

4. Publication of the notice of sale in a newspaper of general circulation in each county in which the trust property to be sold is situated. The notice of sale shall be published at least once a week for four consecutive weeks. The last date of publication shall not be less than ten days prior to before the date of sale. Publication is deemed completed on the date of the first of the four publications of the notice of sale pursuant to this paragraph.

B. The sale shall be held at the time and place designated in the notice of sale on a day other than a Saturday or legal holiday between 9:00 a.m. and 5:00 p.m. mountain standard time at a specified place on the trust property, at a specified place at any building that serves as a location of the superior court or at a specified place at a place of business of the trustee, in any county in which part of the trust property to be sold is situated.

C. The notice of sale shall contain:

1. The date, time and place of the sale. The date, time and place shall be set pursuant to section 33-807, subsection D. The date shall be no not sooner than the ninety-first day after the date that the notice of sale was recorded.

2. The street address, if any, or identifiable location as well as the legal description of the trust property.

3. The county assessor's tax parcel number for the trust property or the tax parcel number of a larger parcel of which the trust property is a part.

4. The original principal balance as shown on the deed of trust. If the amount is not shown on the deed of trust, it shall be listed as "unspecified".

5. The names and addresses, as of the date the notice of sale is recorded, of the beneficiary and the trustee, the name and address of the original trustor as stated in the deed of trust, the signature of the trustee and the basis for the trustee's qualification pursuant to section 33-803, subsection A, including an express statement of the paragraph under section 33-803, subsection A on which the qualification is based. The address of the beneficiary shall not be in care of the trustee.

6. The telephone number of the trustee.

7. The name of the state or federal licensing or regulatory body or controlling agency of the trustee as prescribed by section 33-803, subsection A.

8. For residential property with not more than four RESIDENTIAL units, the following statement in the first paragraph of the notice, printed in boldfaced and capitalized type:

NOTice to tenants and other eligible bidders: you may have a right to buy this property after the trustee sale. If you are an "eligible tenant buyer", you can buy the property if you match the successful bid made at the trustee sale. If you are an "eligible bidder", you may be able to buy the property if you exceed the successful bid made at the trustee sale. There are three steps you must follow. First, two calendar days after the sale you can call the telephone number or access the website address on this notice to find the amount of the successful bid and the address of the person who conducted the sale. Second, you must send that person a written notice of your intent to place a bid so that the person RECEIVES it not more than fifteen days after the date of the sale. Third, you must submit a bid to the person who conducted the sale so that the person RECEIVES it not more than forty-five days after the date of the sale. If you think you may be an "ELIGIBLE tenant buyer" or "eligible bidder", consider contacting an attorney or real estate professional immediately regarding this POTENTIAL right to purchase.

8. 9. The following statement in the first second paragraph of the notice, printed in bold-faced and capitalized type:

Notice! If you believe there is a defense to the trustee sale or if you have an objection to the trustee sale, you must file an action and obtain a court order pursuant to rule 65, Arizona rules of civil procedure, stopping the sale no later than 5:00 p.m. mountain standard time of the last business day before the scheduled date of the sale, or you may have waived any defenses or objections to the sale. Unless you obtain an order, the sale will be final.

D. The notice of sale shall be sufficient if made in substantially the following form:

Notice of Trustee's Sale

The following legally described trust property will be sold, pursuant to the power of sale under that certain trust deed recorded in docket or book _______________________ at page ____________ records of ________________ county, Arizona. Notice! if you believe there is a defense to the trustee sale or if you have an objection to the trustee sale, you must file an action and obtain a court order pursuant to rule 65, Arizona rules of civil procedure, stopping the sale no later than 5:00 p.m. mountain standard time of the last business day before the scheduled date of the sale, or you may have waived any defenses or objections to the sale. Unless you obtain an order, the sale will be final and will occur at public auction to the highest bidder at (specific place of sale as permitted by law) __________________, in ______________ county, in or near _______________, Arizona, on ________, ____, at ___________ o'clock ___m. of said day:

(street address, if any, or identifiable

location of trust property)

(legal description of trust property)

Tax parcel number _______________

Original principal balance $________________________

Name and address of beneficiary ______________________________

______________________________

Name and address of original trustor _________________________

_________________________

Name, address and telephone number of trustee ________________

__________________________________

Website address to obtain information for eligible tenant buyers and eligible bidders __________________________________

Signature of trustee _________________________________________

Manner of trustee qualification ______________________________

Name of trustee's regulator __________________________________

Dated this _____________ day of ______________, ____.

(Acknowledgement)

E. Any error or omission in the information required by subsection C or D of this section, other than an error in the legal description of the trust property or an error in the date, time or place of sale, shall not invalidate a trustee's sale. Any error in the legal description of the trust property shall not invalidate a trustee's sale if, considered as a whole, the information provided is sufficient to identify the trust property being sold. If there is an error or omission in the legal description so that the trust property cannot be identified, or if there is an error in the date, time or place of sale, the trustee shall record a cancellation of notice of sale. The trustee or any person furnishing information to the trustee shall not be subject to liability for any error or omission in the information required by subsection C of this section except for the wilful and intentional failure to provide such information. This subsection does not apply to claims made by an insured under any policy of title insurance.

F. The notice of trustee sale may not be rerecorded for any reason. This subsection does not prohibit the recording of a new or subsequent notice of sale regarding the same property. END_STATUTE

Sec. 2. Section 33-810, Arizona Revised Statutes, is amended to read:

START_STATUTE33-810. Sale by public auction; postponement of sale

A. On the date and at the time and place designated in the notice of sale, the trustee shall offer to sell the trust property at public auction for cash to the highest bidder. The trustee may schedule more than one sale for the same date, time and place. The attorney or agent for the trustee may conduct the sale and act at such sale as the auctioneer for the trustee. Any person, including the trustee or beneficiary, may bid at the sale. Only the beneficiary may make a credit bid in lieu of cash at sale. Except for bids prescribed by section 33-811.01, the trustee shall require every bidder except the beneficiary to provide a ten thousand dollar $10,000 deposit in any form that is satisfactory to the trustee as a condition of entering a bid. The trustee or auctioneer may control the means and manner of the auction. Every bid shall be deemed an irrevocable offer until the sale is completed, except that a subsequent bid by the same bidder for a higher amount shall cancel that bidder's lower bid. To determine the highest price bid, the trustor or beneficiary present at the sale may recommend the manner in which the known lots, parcels or divisions of the trust property described in the notice of sale be sold. The trustee shall conditionally sell the trust property under each recommendation, and, in addition, shall conditionally sell the trust property as a whole. The trustee shall determine which conditional sale or sales result in the highest total price bid for all of the trust property. The trustee shall return deposits to all but the bidder or bidders whose bid or bids result in the highest bid price. The sale shall be completed on payment by the purchaser of the price bid in a form satisfactory to the trustee and, for residential property with not more than four residential units, on compliance with section 33-811.01 or expiration of the time for COMPLIANCE with section 33-811.01. The subsequent execution, delivery and recordation of the trustee's deed as prescribed by section 33-811 are ministerial acts. If the trustee's deed is recorded in the county in which the trust property is located within fifteen business days after the date of the sale, the trustee's sale is deemed perfected at the appointed date and time of the trustee's sale. If the highest price bid at a completed sale is less than the amount of that bidder's deposit, the amount of the deposit in excess of the bid price shall be refunded by the trustee at the time of delivery of the trustee's deed.

B. The person conducting the sale may postpone or continue the sale from time to time or change the place of the sale to any other location authorized pursuant to this chapter by giving notice of the new date, time and place by public declaration at the time and place last appointed for the sale. Any new sale date shall be a fixed date within ninety calendar days of the date of the declaration. After a sale has been postponed or continued, the trustee, on request, shall make available the date and time of the next scheduled sale and, if the location of the sale has been changed, the new location of the sale until the sale has been conducted or canceled and providing this information shall be without obligation or liability for the accuracy or completeness of the information. No other notice of the postponed, continued or relocated sale is required except as provided in subsection C of this section.

C. A sale shall not be complete if the sale as held is contrary to or in violation of any federal statute in effect because of an unknown or undisclosed bankruptcy. A sale so held shall be deemed to be continued to a date, time and place announced by the trustee at the sale and shall comply with subsection B of this section or, if not announced, shall be continued to the same place and at the same time twenty-eight days later, unless the twenty-eighth day falls on a Saturday or legal holiday, in which event it shall be continued to the first business day thereafter. In the event a sale is continued because of an unknown or undisclosed bankruptcy, the trustee shall notify by registered or certified mail, with postage prepaid, all bidders who provide their names, addresses and telephone numbers in writing to the party conducting the sale of the continuation of the sale.

D. A sale is postponed by operation of law to the next business day at the same scheduled time and place if an act of force majeure prevents access to the sale location for the conduct of the sale. END_STATUTE

Sec. 3. Section 33-811, Arizona Revised Statutes, is amended to read:

START_STATUTE33-811. Payment of bid; trustee's deed

A. The highest bidder at the sale, other than the beneficiary to the extent of the credit bid, shall pay the price bid by no not later than 5:00 p.m. mountain standard time of the following day, other than a Saturday or legal holiday. If the highest bidder fails to pay the amount bid for the property struck off to the bidder at the sale, the trustee, in the trustee's sole discretion, shall either continue the sale to reopen bidding or immediately offer the trust property to the second highest bidder who may purchase the trust property at that bidder's bid price. The deposit of the highest bidder who fails to pay the amount bid shall be forfeited and shall be treated as additional sale proceeds to be applied in accordance with section 33-812, subsection A. If the second highest bidder does not pay that bidder's bid price by 5:00 p.m. mountain standard time of the next day, excluding Saturdays and legal holidays, after the property has been offered to that bidder by the trustee, the trustee shall either continue the sale to reopen bidding or offer the trust property to each of the prior bidders on successive days, excluding Saturdays and legal holidays, in order of their highest bid, until a bid price is paid, or if there is no other bidder, the sale shall be deemed to be continued to a time and place designated by the trustee, or if not designated, the sale shall be continued to the same place and at the same time twenty-eight days after the last scheduled sale date. If the twenty-eighth day is a Saturday or legal holiday, the sale shall be continued to the next business day. If the sale is continued, the trustee shall provide notice of the continuation of the sale by registered or certified mail, with postage prepaid, to all bidders who provide their names, addresses and telephone numbers in writing to the party conducting the sale and, for a RESIDENTIAL PROPERTY with not more than four RESIDENTIAL units, to every person residing at those units. Except for a bidder deemed the successful bidder pursuant to section 33-811.01, in addition to the forfeit of deposit, a highest bidder who fails to pay the amount bid by that bidder is liable to any person who suffers loss or expenses as a result, including attorney fees. In any subsequent sale of trust property, the trustee may refuse to accept any bid of that person. In any sale that is continued pursuant to this subsection, the trustee shall reject the bid from any previous bidder who elected not to pay that bidder's bid price.

B. The price bid shall be paid at the office of the trustee or the trustee's agent, or any other reasonable place designated by the trustee. The payment of the bid price may be made at a later time if agreed upon on in writing by the trustee. Within seven business days after receipt of payment by the trustee or the trustee's agent, made in a form that is satisfactory to the trustee, the trustee shall execute and submit the trustee's deed to the county recorder for recording and, upon on request, shall provide an unrecorded copy of the signed trustee's deed to the purchaser, except that for a RESIDENTIAL PROPERTY with not more than four residential units, the trustee shall allow eligible tenant buyers and eligible bidders to match or exceed the bid amount pursuant to section 33-811.01 and may not execute the trustee's deed until after compliance with section 33-811.01 or expiration of the time for compliance with section 33-811.01. The recording of the trustee's deed upon on sale shall constitute delivery of the deed to the purchaser. The trustee is not liable for any damages resulting from the failure to record the trustee's deed upon on sale after physical delivery of the deed to the purchaser. The trustee's deed shall raise the presumption of compliance with the requirements of the deed of trust and this chapter relating to the exercise of the power of sale and the sale of the trust property, including recording, mailing, publishing and posting of notice of sale and the conduct of the sale. A trustee's deed shall constitute conclusive evidence of the meeting of those requirements in favor of purchasers or encumbrancers for value and without actual notice. Knowledge of the trustee shall not be imputed to the beneficiary.

C. The trustor, its successors or assigns, and all persons to whom the trustee mails a notice of a sale under a trust deed pursuant to section 33-809 shall waive all defenses and objections to the sale not raised in an action that results in the issuance of a court order granting relief pursuant to rule 65, Arizona rules of civil procedure, entered before 5:00 p.m. mountain standard time on the last business day before the scheduled date of the sale. A copy of the order, the application for the order and the complaint shall be delivered to the trustee within twenty-four hours after entering the order.

D. A sale is not complete if the sale violates subsection C of this section because of an undisclosed order entered by the court within the time provided for in subsection C of this section. A sale held in violation of subsection C of this section shall be continued to a date, time and place announced by the trustee at the sale and shall comply with section 33-810, subsection B. If not announced, the sale shall be continued to the same place and at the same time twenty-eight days later. If the twenty-eighth day falls on a Saturday or legal holiday, the sale shall be continued to the next business day. If the sale is continued because of an unknown or undisclosed order as provided in this subsection, the trustee shall notify by registered or certified mail, with postage prepaid, all bidders who provide names, addresses and telephone numbers in writing to the party conducting the sale of the continuation of the sale.

E. The trustee's deed shall operate to convey to the purchaser the title, interest and claim of the trustee, the trustor, the beneficiary, their respective successors in interest and all persons claiming the trust property sold by or through them, including all interest or claim in the trust property acquired subsequent to the recording of the deed of trust and prior to before delivery of the trustee's deed. That conveyance shall be absolute without right of redemption and clear of all liens, claims or interests that have a priority subordinate to the deed of trust and shall be subject to all liens, claims or interests that have a priority senior to the deed of trust.

F. On completion of the sale and conveyance of the trustee's deed to the purchaser, the trustee shall notify the beneficiary of the beneficiary's obligations as prescribed by section 11-1133. The trustee shall provide notice to the beneficiary on or before the date of the trustee's sale. END_STATUTE

Sec. 4. Title 33, chapter 6.1, article 1, Arizona Revised Statutes, is amended by adding section 33-811.01, to read:

START_STATUTE33-811.01. Residential property; payment by eligible tenant buyers or eligible bidders; definitions

A. For a trustee sale of RESIDENTIAL property with not more than four RESIDENTIAL units, an eligible tenant buyer may proceed as follows to obtain the property after the trustee sale:

1. If the initially successful bidder was not an eligible tenant buyer:

(a) The eligible tenant buyer may submit a bid in an amount equal to the full amount of the successful bid. The eligible tenant buyer must submit the bid to the trustee by certified mail, overnight delivery or other method that CONFIRMS the DELIVERY date within thirty days after the trustee sale, and the bid must be in cash or a CASHIER'S check.

(b) The eligible tenant buyer also shall submit to the trustee an affidavit stating that:

(i) the eligible tenant buyer will OCCUPY the residential property as the eligible tenant buyer's primary residence within sixty days after the recording of a trustee's deed in favor of the eligible tenant buyer.

(ii) The ELIGIBLE TENANT buyer will maintain occupancy at that residential PROPERTY for at least one year.

(iii) The eligible tenant buyer is not the beneficiary of the deed of trust or the child, spouse or parent of the BENEFICIARY of the deed of trust.

(iv) The eligible tenant buyer is not acting as an agent for any other person or entity purchasing the real property.

2. On compliance with paragraph 1 of this subsection, the eligible tenant buyer is deemed to be the successful bidder at the trustee sale and the trustee shall proceed as prescribed in section 33-811, subsections B through F with respect to the eligible tenant buyer who was deemed the successful bidder.

B. For a trustee sale of RESIDENTIAL property with not more than four RESIDENTIAL units, an eligible bidder may proceed as follows to obtain the property after the trustee sale:

1. If the successful bidder was not an eligible tenant buyer:

(a) The eligible bidder may submit a bid in an amount that exceeds the full amount of the successful bid and the bids of all other eligible bidders. The eligible bidder must submit the bid to the trustee by certified mail, overnight delivery or other method that CONFIRMS the DELIVERY date within thirty days after the trustee sale, and the bid must be in cash or a CASHIER'S check.

(b) The eligible bidder also shall submit to the trustee an affidavit stating that the eligible bidder meets the REQUIREMENTS for eligible bidders prescribed by this section and setting out the facts supporting that statement.

2. On compliance with paragraph 1 of this subsection, the eligible bidder is deemed to be the successful bidder at the trustee sale and the trustee shall proceed as prescribed in section 33-811, subsections B through F with respect to the eligible bidder who was deemed the successful bidder and shall return to the unsuccessful bidders all amounts bid.

C. For the purposes of this section:

1. "Eligible bidder" means either of the following:

(a) A natural person who states in the required affidavit that the person will OCCUPY the residential property as the person's primary residence within sixty days after the recording of a trustee's deed in favor of the person and that the person will maintain occupancy at that residential PROPERTY for at least one year.

(b) A private nonprofit corporation whose primary activities include obtaining, developing or MAINTAINING affordable housing in this state.

2. "Eligible tenant buyer" means a NATURAL person who at the time of the trustee sale is all of the following:

(a) OCCUPYING the RESIDENTIAL property that is the subject of the trustee sale as that person's primary residence.

(b) Occupying the residential property under a rental agreement that was entered into as the result of an arm's LENGTH transaction with the BENEFICIARY of the deed of trust on a date before the default on the obligation that is secured by the deed of trust.

(c) Not the beneficiary of the deed of trust or the child, spouse or parent of the BENEFICIARY of the deed of trust. END_STATUTE

Sec. 5. 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 low-income families, moderate income 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 96-399). 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. ESTABLISH and operate a REGISTRY of persons or entities that own more than twenty-five residential properties in this state, monitor the level of compliance with state and local laws with respect to those properties and include that information in the annual report to the governor and the legislature prescribed by this subsection.

9. Acquire and assist in acquiring at trustee sales residential housing appropriate for maintaining and increasing the supply of housing for purchase or rent by low and moderate income persons, including assisting nonprofit corporations that provide housing assistance acquire residential properties for sale or rent.

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

9. 11. 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. 12. 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 Arizona department of housing shall act consistently with the 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 Arizona department of housing shall implement all existing laws and regulations established by the federal government, its agencies and this state for that purpose. END_STATUTE

Sec. 6. Section 41-3955, Arizona Revised Statutes, is amended to read:

START_STATUTE41-3955. Housing trust fund; purpose; annual report

A. The housing trust fund is established, and the director shall administer the fund. The fund consists of monies from unclaimed property deposited in the fund pursuant to section 44-313, monies transferred pursuant to section 35-751 and investment earnings.

B. On notice from the department, 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. Except as provided in subsection D of this section, fund monies shall be spent on approval of the department for developing projects and programs connected with providing housing opportunities for low and moderate income households and for housing affordability programs, including acquiring and assisting in acquiring residential properties at trustee sales as prescribed by section 33-811.01. Pursuant to section 44-313, subsection A, A portion of fund monies shall be used exclusively for housing in rural areas.

D. Fund monies may be spent on constructing or renovating facilities and on housing assistance, including support services, for persons who have been determined to be seriously mentally ill and to be chronically resistant to treatment.

E. For the purposes of subsection C of this section, in approving the expenditure of monies, the director shall give priority to funding projects that provide for acquiring, operating, constructing or renovating facilities for housing for low-income families and that provide housing and shelter to families that have children.

F. The director shall report annually to the legislature on the status of the housing trust fund. The report shall include a summary of facilities for which funding was provided during the preceding fiscal year and shall show the cost and geographic location of each facility and the number of individuals benefiting from the operation, construction or renovation of the facility. The report shall also include the number of individuals who benefit from housing assistance pursuant to subsection D of this section. The report shall be submitted to the president of the senate and the speaker of the house of representatives, and a copy provided to the secretary of state, not later than September 1 of each year.

G. Monies in the housing trust fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

H. An amount not to exceed ten percent of the housing trust fund monies may be appropriated annually by the legislature to the department for administrative costs in providing services relating to the housing trust fund.

I. For any construction project financed by the department pursuant to this section, 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. END_STATUTE