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ARIZONA STATE SENATE
Fifty-Sixth Legislature, First Regular Session
AMENDED
public entities; contracts; prohibitions
Purpose
Prohibits a public entity from requiring a company to implement an environmental, social or governance standards policy as a condition of entering into or renewing a contract.
Background
Current statute prohibits the state, a political subdivision of the state or an agency, board, commission or department from entering into a contract with a value of $100,000 or more with a company to acquire or dispose of services, supplies, information technology or construction unless the contract includes a written certification that the company is not currently engaged in, and agrees for the duration of the contract to not engage in, a boycott of goods and services from Israel. A public entity may not adopt a procurement, investment or other policy that has the effect of inducing or requiring a person or company to boycott Israel (A.R.S ยงยง 35-393 and 35-393.01).
There is no anticipated fiscal impact to the state General Fund associated with this legislation.
Provisions
1. Prohibits a public entity from requiring a company to implement an environmental, social or governance standards policy as a condition of entering into or renewing a contract.
2. Prohibits a public entity from adopting a procurement, investment or other policy that has the effect of inducing or requiring a company to implement an environmental, social or governance standards policy.
3. Defines environmental, social or governance standards policy as a business policy that furthers:
a) an international, domestic or industry agreement relating to an environmental or social goal;
b) a corporate governance structure based on social characteristics; or
c) a social or environmental goal.
4. Defines company as an organization, association, corporation, partnership, joint venture, limited partnership, limited liability association, including a wholly owned subsidiary, majority-owned subsidiary, parent company or affiliate that engages in for-profit activity and that has 10 or more full-time employees.
5. Defines public entity as the state, a political subdivision, agency board, commission, department or political subdivision of the state and includes the universities under the jurisdiction of the Arizona Board of Regents and community college districts as outlined.
6. Becomes effective on the general effective date.
Amendments Adopted by Committee of the Whole
1. Removes the prohibition on a public entity entering into or renewing a contract with a company unless the contract includes a written certification that the company does not currently and will not implement an environmental, social or governance standards policy.
3. Makes technical changes.
Senate Action
GOV 2/15/23 DP 4-3-1
Prepared by Senate Research
March 9, 2023
AN/slp