SB1665 - 562R

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

Section 1. Title 9, chapter 4, article 6.4, Arizona Revised Statutes, is amended by adding section 9-469, to read:

START_STATUTE9-469. Building permits; inspections; third-party review; appeals; definition

A. IF A MUNICIPALITY DOES NOT APPROVE, CONDITIONALLY APPROVE or deny an APPLICATION for A residential BUILDING PERMIT within FIFTEEN DAYs AFTER THE DATE THE APPLICATION IS SUBMITTED, ANY REQUIRED REVIEW OF THE APPLICATION MAY BE PERFORMED BY A QUALIFIED THIRD PARTY selected by the applicant. The qualified third party selected by the applicant may not be THE APPLICANT OR A PERSON WHOSE WORK IS THE SUBJECT OF THE APPLICATION. a QUALIFIED THIRD PARTY SELECTED BY THE APPLICANT may be any of the following:

1. A PERSON who is EMPLOYED BY THE MUNICIPALITY that is REVIEWING THE APPLICATION.

2. A person who is EMPLOYED BY ANOTHER MUNICIPALITY TO REVIEW residential building permit APPLICATIONS.

3. AN ENGINEER OR ARCHITECT who is registered pursuant to TITLE 32, CHAPTER 1.

B. IF A MUNICIPALITY DOES NOT CONDUCT AN INSPECTION REQUIRED AS A CONDITION OF OBTAINING A CERTIFICATE OF OCCUPANCY FOR A RESIDENTIAL DWELLING UNIT WITHIN FORTY-EIGHT HOURS after AN INSPECTION REQUEST, ANY REQUIRED INSPECTION MAY BE PERFORMED BY A QUALIFIED THIRD PARTY selected by the applicant. The qualified third party selected by the applicant may not be the applicant or a person whose work is the subject of the application. A QUALIFIED THIRD PARTY SELECTED BY THE APPLICANT TO PERFORM THE INSPECTION MAY BE any of the following:

1. A PERSON who is CERTIFIED to inspect buildings by an international council on model codes and standards for building safety.

2. A person who is EMPLOYED BY THE MUNICIPALITY AS A BUILDING INSPECTOR.

3. A person who is EMPLOYED BY ANOTHER MUNICIPALITY AS A BUILDING INSPECTOR.

4. AN ENGINEER OR ARCHITECT who is registered pursuant to TITLE 32, CHAPTER 1.

C. A third party WHO REVIEWS A residential BUILdiNG permit application OR who PERFORMs AN INSPECTION required to obtain A residential dwelling unit CERTIFICATE OF OCCUPANCY SHALL do both of the following:

1. REVIEW THE APPLICATION or conduct THE INSPECTION AND TAKE ALL OTHER RELATED ACTIONS IN ACCORDANCE WITH ALL requirements ADOPTED BY THE MUNICIPALITY WHERE THE APPLICATION WAS SUBMITTED.

2. PROVIDE NOTICE TO THE MUNICIPALITY OF THE RESULTS OF THE REVIEW OR INSPECTION.

D. A MUNICIPALITY MAY PRESCRIBE A REASONABLE FORMAT FOR THE NOTICE REQUIRED BY SUBSECTION C of this section.

E. A MUNICIPALITY MAY NOT REQUEST OR REQUIRE AN APPLICANT TO WAIVE A DEADLINE OR OTHER PROCEDURE required by this section.

F. A person MAY APPEAL TO THE GOVERNING BODY OF THE MUNICIPALity any of the following:

1. A DECISION by the municipality TO APPROVE, CONDITIONALLY APPROVE OR Deny A residential building permit APPLICATION.

2. A decision made by a qualified third party authorized in subsection a of this section to review a residential building permit application.

3. The results of an inspection conducted by the municipality.

4. The results of an inspection conducted by a qualified third party authorized by subsection b of this section to conduct an inspection.

g. An appeal filed pursuant to subsection f of this section shall BE FILED WITH THE GOVERNING BODY WITHIN FIFTEEN DAYS AFTER THE DATE THE DECISION BEING APPEALED WAS MADE. If the governing body hearing the appeal does not affirm the decision being appealed within sixty days after THE APPEAL is FILED, THE APPLICATION THAT IS THE SUBJECT OF THE APPEAL SHALL BE DEEMED APPROVED OR THE INSPECTION THAT IS THE SUBJECT OF THE APPEAL IS WAIVED.

H. FOR the PURPOSES OF THIS SECTION, "APPLICATION" means A PLAT, PLAN, PERMIT OR OTHER DOCUMENT that is RELATED TO LAND DEVElopment AND Building CONSTRUCTION and that is NECESSARY FOR THE CONSTRUCTION OF A RESIDENTIAL DWELLING UNIT. END_STATUTE

Sec. 2. Section 9-835, Arizona Revised Statutes, is amended to read:

START_STATUTE9-835. Licensing time frames; compliance; consequence for failure to comply with time frame; exemptions

A. For any new ordinance or code requiring a license, a municipality shall have in place an overall time frame during which the municipality will either grant or deny each type of license that it issues. The overall time frame for each type of license shall state separately the administrative completeness review time frame and the substantive review time frame and shall be posted on the municipality's website or the website of an association of cities and towns if the municipality does not have a website.

B. On or before December 31, 2012, A municipality that issues licenses required under existing ordinances or codes shall have in place an overall time frame during which the municipality will either grant or deny each type of license that it issues. The overall time frame for each type of license shall state separately the administrative completeness review time frame and the substantive review time frame and shall be posted on the municipality's website or the website of an association of cities and towns if the municipality does not have a website. Municipalities shall prioritize the establishment of time frames for those licenses that have the greatest impact on the public.

C. In establishing time frames, municipalities shall consider all of the following:

1. The complexity of the licensing subject matter.

2. The resources of the municipality.

3. The economic impact of delay on the regulated community.

4. The impact of the licensing decision on public health and safety.

5. The possible use of volunteers with expertise in the subject matter area.

6. The possible increased use of general licenses for similar types of licensed businesses or facilities.

7. The possible increased cooperation between the municipality and the regulated community.

8. Increased municipal flexibility in structuring the licensing process and personnel including:

(a) Adult businesses and other licenses that are related to the first amendment.

(b) Master planned communities.

(c) Suspension of the substantive and overall time frames for purposes including delays caused by the need for public hearings, state or federal licenses or approvals from public utilities on residential or commercial development projects.

9. That the substantive review time frames and overall time frames do not include the time required for an applicant to obtain other nonmunicipal licenses or to participate in meetings as required by law.

D. A municipality shall issue a written or electronic notice of administrative completeness or deficiencies to an applicant for a license within the administrative completeness review time frame. If the permit sought requires approval of more than one department of the municipality, each department may issue a written or electronic notice of administrative completeness or deficiencies.

E. If a municipality determines that an application for a license is not administratively complete, the municipality shall include a comprehensive list of the specific deficiencies in the written or electronic notice provided pursuant to subsection D of this section. If the municipality issues a written or electronic notice of deficiencies within the administrative completeness time frame, the administrative completeness review time frame and the overall time frame are suspended from the date the notice is issued until the date that the municipality receives the missing information from the applicant. The municipality may issue an additional written or electronic notice of administrative completeness or deficiencies based on the applicant's submission of missing information. If the permit sought requires approval of more than one department of the municipality, each department may issue an additional written or electronic notice of administrative completeness or deficiencies based on the applicant's submission of missing information.

F. If a municipality does not issue a written or electronic notice of administrative completeness or deficiencies within the administrative completeness review time frame, the application is deemed administratively complete. If a municipality issues a timely written or electronic notice of deficiencies, an application shall is not be complete until all requested information has been received by the municipality. A municipality may consider an application withdrawn if, by fifteen days or more after the date of notice, as established by the municipality, the applicant does not supply the documentation or information requested or an explanation of why the information cannot be provided within the established time period.

G. During the substantive review time frame, a municipality may make one comprehensive written or electronic request for corrections. If the municipality identifies legal requirements that were not included in the comprehensive request for corrections, the municipality may amend the comprehensive request for corrections once to include the legal requirements and the legal authority for the requirements. Within five working days after a request by the applicant, the municipality shall meet or discuss with the applicant the request for corrections and provide sufficient information and instruction to allow the applicant to provide the requested corrections. If the permit sought requires approval of more than one department of the municipality, each department may issue a comprehensive written or electronic request for corrections. If the applicant fails to resolve an issue identified in a request for corrections, the municipality may make supplemental written or electronic requests for corrections that are limited to issues previously identified in a comprehensive request for corrections. If a municipality issues a comprehensive written or electronic request or a supplemental request for corrections, the substantive review time frame and the overall time frame are suspended from the date the request is issued until the date that the municipality receives the corrections from the applicant. If an applicant requests significant changes, alterations, additions or amendments to an application that are consistent with the purposes of the original application and that are not in response to the request for corrections, a municipality may make one additional comprehensive written or electronic request for corrections and may have no not more than an additional fifty per cent percent of the substantive review time frame as established by the municipality for that license to grant or deny the license. Nothing shall prevent communication between a municipality and an applicant regarding a comprehensive written or electronic request for corrections or a supplemental request for corrections. except for an application submitted for a change in zoning pursuant to chapter 4, article 6.1 of this title, a municipality may not deny a license application that is necessary for land development or building construction unless the municipality considers the application withdrawn. A municipality may consider an application withdrawn if, by thirty days or more after the date of notice, as established by the municipality, the applicant does not supply the documentation or information requested or an explanation of why the information cannot be provided within the established time period.

H. Nothing shall prevent the municipality from continuing to process the application during the suspension of the substantive review time frame and overall time frame.

I. By mutual written or electronic agreement, a municipality and an applicant for a license may extend the substantive review time frame and the overall time frame. An extension of the substantive review time frame and the overall time frame may not exceed fifty per cent percent of the overall time frame.

J. Unless a municipality and an applicant for a license mutually agree to extend the substantive review time frame and the overall time frame pursuant to subsection I of this section, a municipality shall issue a written or electronic notice granting or denying a license to an applicant. If a municipality denies or withdraws an application for a license, the municipality shall include in the written or electronic notice at least the following information:

1. Justification for the denial or withdrawal with references to the statutes, ordinances, codes or substantive policy statements on which the denial or withdrawal is based.

2. An explanation of the applicant's right to appeal the denial or withdrawal. The explanation shall include the number of working days in which the applicant must file a protest challenging the denial or withdrawal and the name and telephone number of a municipal contact person who can answer questions regarding the appeals process.

3. An explanation of the applicant's right to resubmit the application, the total amount of fees that will be assessed if the applicant resubmits the application and the method in which those fees were calculated.

K. If a municipality makes more than one comprehensive written or ELECTRONIC request for corrections and one supplemental written or electronic request for corrections limited to previously identified issues or does not issue the applicant the written or electronic notice granting, conditionally granting or denying a license within the overall time frame or within the mutually agreed on time frame extension, the municipality shall refund to the applicant all fees charged for reviewing and acting on the application for the license, and shall excuse payment of any fees that have not yet been paid and shall pay any MONETARY damages resulting from the delay. The municipality shall not require an applicant to submit an application for a refund pursuant to this subsection but may require evidence of MONETARY damages. The refund shall be made within thirty working days after the expiration of the overall time frame or the time frame extension and the payment for MONETARY damages shall be made within thirty working days after the applicant provides the required evidence. The municipality shall continue to process the application. Notwithstanding any other statute, the municipality shall make the refund from the fund in which the application fees were originally deposited. The right to receive a refund of fees charged for reviewing and acting on the application for the license may not be waived by an applicant.

L. If an application for a license is denied and the applicant resubmits the application for the same purposes with only revisions or corrections to the original application, the municipality shall not assess any additional application fees that exceed the cost of processing the resubmitted revisions or corrections. This subsection does not apply to license applications that were denied for disqualifying criminal convictions or that were submitted fraudulently.

M. If an application for a license is withdrawn and the applicant resubmits the application for the same purpose, the municipality shall not assess any additional application fees that exceed fifty per cent percent of the original applicant application fees that have not been refunded to the applicant. This subsection does not apply to license applications that were denied for disqualifying criminal convictions or that were submitted fraudulently.

N. This section does not apply to a license that is either:

1. issued within seven working days after receipt of the initial application or a permit that expires within twenty-one working days after issuance.

2. Necessary for the construction or development of a residential lot, including swimming pools, hardscape and property walls, subdivisions or master planned community.

O. For the purposes of this section:

1. "Master planned community" means development by one or more developers of real estate that consists of residential, commercial, education, health care, open space and recreational components and that is developed pursuant to a long-range, multiphase master plan providing comprehensive land use planning and staged implementation and development.

2. "Subdivision" means improved or unimproved land or lands divided for the purposes of financing, sale or lease, whether immediate or future, into four or more lots, tracts or parcels of land, or, if a new street is involved, any such property that is divided into two or more lots, tracts or parcels of land, or, any such property, the boundaries of which have been fixed by a recorded plat, which is divided into more than two parts. Subdivision includes any condominium, cooperative, community apartment, townhouse or similar project containing four or more parcels, in which an undivided interest in the land is coupled with the right of exclusive occupancy of any unit located thereon, but plats of such projects need not show the buildings or the manner in which the buildings or airspace above the property shown on the plat are to be divided. END_STATUTE