HB2209 - 571R

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

Section 1. Section 41-1954, Arizona Revised Statutes, is amended to read:

START_STATUTE41-1954. Powers and duties

A. In addition to the powers and duties of the agencies listed in section 41-1953, subsection E, the department shall:

1. Administer the following services:

(a) Employment services, including manpower programs and work training, field operations, technical services, unemployment compensation, community work and training and other related functions in furtherance of programs under the social security act, as amended, the Wagner-Peyser act, as amended, the federal unemployment tax act, as amended, 33 United States Code, the family support act of 1988 (P.L. 100-485) and other related federal acts and titles.

(b) Individual and family services, which shall include a section on aging, services to children, youth and adults and other related functions in furtherance of social service programs under the social security act, as amended, title IV, except parts B and E, grants to states for aid and services to needy families with children and for child welfare services, title XX, grants to states for services, the older Americans act, as amended, the family support act of 1988 (P.L. 100-485) and other related federal acts and titles.

(c) Income maintenance services, including categorical assistance programs, special services unit, child support collection services, establishment of paternity services, maintenance and operation of a state case registry of child support orders, a state directory of new hires, a support payment clearinghouse and other related functions in furtherance of programs under the social security act, title IV, grants to states for aid and services to needy families with children and for child welfare services, title XX, grants to states for services, as amended, and other related federal acts and titles.

(d) Rehabilitation services, including vocational rehabilitation services and sections for the blind and visually impaired, communication disorders, correctional rehabilitation and other related functions in furtherance of programs under the vocational rehabilitation act, as amended, the Randolph-Sheppard act, as amended, and other related federal acts and titles.

(e) Administrative services, including the coordination of program evaluation and research, interagency program coordination and in-service training, planning, grants, development and management, information, legislative liaison, budget, licensing and other related functions.

(f) Manpower planning, including a state manpower planning council for the purposes of the federal-state-local cooperative manpower planning system and other related functions in furtherance of programs under the comprehensive employment and training act of 1973, as amended, and other related federal acts and titles.

(g) Economic opportunity services, including the furtherance of programs prescribed under the economic opportunity act of 1967, as amended, and other related federal acts and titles.

(h) Intellectual disability and other developmental disability programs, with emphasis on referral and purchase of services. The program shall include educational, rehabilitation, treatment and training services and other related functions in furtherance of programs under the developmental disabilities services and facilities construction act (P.L. 91-517) and other related federal acts and titles.

(i) Nonmedical home and community based services and functions, including department-designated case management, housekeeping services, chore services, home health aid, personal care, visiting nurse services, adult day care or adult day health, respite sitter care, attendant care, home delivered meals and other related services and functions.

2. Provide a coordinated system of initial intake, screening, evaluation and referral of persons served by the department.

3. Adopt rules it deems necessary or desirable to further the objectives and programs of the department.

4. Formulate policies, plans and programs to effectuate the missions and purposes of the department.

5. Employ and determine the conditions of employment and prescribe the duties and powers of administrative, professional, technical, secretarial, clerical and other persons subject to chapter 4, article 4 and, as applicable, article 5 of this title as may be necessary in the performance of its duties, contract for the services of outside advisors, consultants and aides as may be reasonably necessary and reimburse department volunteers, designated by the director, for expenses in transporting clients of the department on official business.

6. Make contracts and incur obligations within the general scope of its activities and operations subject to the availability of funds.

7. Contract with or assist other departments, agencies and institutions of the state, local and federal governments in the furtherance of its purposes, objectives and programs.

8. Be designated as the single state agency for the purposes of administering and in furtherance of each federally supported state plan.

9. Accept and disburse grants, matching funds and direct payments from public or private agencies for the conduct of programs that are consistent with the overall purposes and objectives of the department.

10. Provide information and advice on request by local, state and federal agencies and by private citizens, business enterprises and community organizations on matters within the scope of its duties subject to the departmental rules on the confidentiality of information.

11. Establish and maintain separate financial accounts as required by federal law or regulations.

12. Advise and make recommendations to the governor and the legislature on all matters concerning its objectives.

13. Have an official seal that is judicially noticed.

14. Annually estimate the current year's population of each county, city and town in this state, using the periodic census conducted by the United States department of commerce, or its successor agency, as the basis for such estimates and deliver such estimates to the economic estimates commission before December 15.

15. Estimate the population of any newly annexed areas of a political subdivision as of July 1 of the fiscal year in which the annexation occurs and deliver such estimates as promptly as is feasible after the annexation occurs to the economic estimates commission.

16. Establish and maintain a statewide program of services for persons who are both hearing impaired and visually impaired and coordinate appropriate services with other agencies and organizations to avoid duplication of these services and to increase efficiency. The department of economic security shall enter into agreements for the utilization of the personnel and facilities of the department of economic security, the department of health services and other appropriate agencies and organizations in providing these services.

17. Establish and charge fees for deposit in the department of economic security prelayoff assistance services fund to employers who voluntarily participate in the services of the department that provide job service and retraining for persons who have been or are about to be laid off from employment. The department shall charge only those fees necessary to cover the costs of administering the job service and retraining services.

18. Establish a focal point for addressing the issue of hunger in this state and provide coordination and assistance to public and private nonprofit organizations that aid hungry persons and families throughout this state. Specifically such activities shall include:

(a) Collecting and disseminating information regarding the location and availability of surplus food for distribution to needy persons, the availability of surplus food for donation to charity food bank organizations, and the needs of charity food bank organizations for surplus food.

(b) Coordinating the activities of federal, state, local and private nonprofit organizations that provide food assistance to the hungry.

(c) Accepting and disbursing federal monies, and any state monies appropriated by the legislature, to private nonprofit organizations in support of the collection, receipt, handling, storage and distribution of donated or surplus food items.

(d) Providing technical assistance to private nonprofit organizations that provide or intend to provide services to the hungry.

(e) Developing a state plan on hunger that, at a minimum, identifies the magnitude of the hunger problem in this state, the characteristics of the population in need, the availability and location of charity food banks and the potential sources of surplus food, assesses the effectiveness of the donated food collection and distribution network and other efforts to alleviate the hunger problem, and recommends goals and strategies to improve the status of the hungry. The state plan on hunger shall be incorporated into the department's state comprehensive plan prepared pursuant to section 41-1956.

(f) Establishing a special purpose advisory council on hunger pursuant to section 41-1981.

19. Establish an office to address the issue of homelessness and to provide coordination and assistance to public and private nonprofit organizations that prevent homelessness or aid homeless individuals and families throughout this state. These activities shall include:

(a) Promoting and participating in planning for the prevention of homelessness and the development of services to homeless persons.

(b) Identifying and developing strategies for resolving barriers in state agency service delivery systems that inhibit the provision and coordination of appropriate services to homeless persons and persons in danger of being homeless.

(c) Assisting in the coordination of the activities of federal, state and local governments and the private sector that prevent homelessness or provide assistance to homeless people.

(d) Assisting in obtaining and increasing funding from all appropriate sources to prevent homelessness or assist in alleviating homelessness.

(e) Serving as a clearinghouse on information regarding funding and services available to assist homeless persons and persons in danger of being homeless.

(f) Developing an annual state comprehensive homeless assistance plan to prevent and alleviate homelessness.

(g) Submitting an annual report to the governor, the president of the senate and the speaker of the house of representatives on the status of homelessness and efforts to prevent and alleviate homelessness. THE REPORT SHALL INCLUDE ESTIMATES OF HOMELESS POPULATIONS AND SUBPOPULATIONS FOR EACH MUNICIPALITY AND COUNTY OF THIS STATE BASED ON THE ANNUAL POINT-IN-TIME COUNT. The department shall provide a copy of this report to the secretary of state. ~~THE REPORT SHALL INCLUDE ESTIMATES OF HOMELESS POPULATIONS AND SUBPOPULATIONS FOR EACH MUNICIPALITY AND COUNTY OF THIS STATE BASED ON THE ANNUAL POINT IN TIME COUNT.~~

20. Cooperate with the Arizona-Mexico commission in the governor's office and with researchers at universities in this state to collect data and conduct projects in the United States and Mexico on issues that are within the scope of the department's duties and that relate to quality of life, trade and economic development in this state in a manner that will help the Arizona-Mexico commission to assess and enhance the economic competitiveness of this state and of the Arizona-Mexico region.

21. Exchange information, including case specific information, and cooperate with the department of child safety for the administration of the department of child safety's programs.

B. If the department of economic security has responsibility for the care, custody or control of a child or is paying the cost of care for a child, it may serve as representative payee to receive and administer social security and United States department of veterans affairs benefits and other benefits payable to such child. Notwithstanding any law to the contrary, the department of economic security:

1. Shall deposit, pursuant to sections 35-146 and 35-147, such monies as it receives to be retained separate and apart from the state general fund on the books of the department of administration.

2. May use such monies to defray the cost of care and services expended by the department of economic security for the benefit, welfare and best interests of the child and invest any of the monies that the director determines are not necessary for immediate use.

3. Shall maintain separate records to account for the receipt, investment and disposition of funds received for each child.

4. On termination of the department of economic security's responsibility for the child, shall release any funds monies remaining to the child's credit in accordance with the requirements of the funding source or in the absence of such requirements shall release the remaining funds monies to:

(a) The child, if the child is at least eighteen years of age or is emancipated.

(b) The person responsible for the child if the child is a minor and not emancipated.

C. Subsection B of this section does not pertain to benefits payable to or for the benefit of a child receiving services under title 36.

D. Volunteers reimbursed for expenses pursuant to subsection A, paragraph 5 of this section are not eligible for workers' compensation under title 23, chapter 6.

E. In implementing the temporary assistance for needy families program pursuant to Public Law 104-193, the department shall provide for cash assistance to two-parent families if both parents are able to work only on documented participation by both parents in work activities described in title 46, chapter 2, article 5, except that payments may be made to families who do not meet the participation requirements if:

1. It is determined on an individual case basis that they have emergency needs.

2. The family is determined to be eligible for diversion from long-term cash assistance pursuant to title 46, chapter 2, article 5.

F. The department shall provide for cash assistance under temporary assistance for needy families pursuant to Public Law 104-193 to two-parent families for no longer than six months if both parents are able to work, except that additional assistance may be provided on an individual case basis to families with extraordinary circumstances. The department shall establish by rule the criteria to be used to determine eligibility for additional cash assistance.

G. The department shall adopt the following discount medical payment system for persons who the department determines are eligible and who are receiving rehabilitation services pursuant to subsection A, paragraph 1, subdivision (d) of this section:

1. For inpatient hospital admissions and outpatient hospital services the department shall reimburse a hospital according to the rates established by the Arizona health care cost containment system administration pursuant to section 36-2903.01, subsection G.

2. The department's liability for a hospital claim under this subsection is subject to availability of funds monies.

3. A hospital bill is considered received for purposes of paragraph 5 of this subsection on initial receipt of the legible, error-free claim form by the department if the claim includes the following error-free documentation in legible form:

(a) An admission face sheet.

(b) An itemized statement.

(d) A discharge summary or an interim summary if the claim is split.

(e) An emergency record, if admission was through the emergency room.

(f) Operative reports, if applicable.

(g) A labor and delivery room report, if applicable.

4. The department shall require that the hospital pursue other third-party payors before submitting a claim to the department. Payment received by a hospital from the department pursuant to this subsection is considered payment by the department of the department's liability for the hospital bill. A hospital may collect any unpaid portion of its bill from other third-party payors or in situations covered by title 33, chapter 7, article 3.

5. For inpatient hospital admissions and outpatient hospital services rendered on and after October 1, 1997, if the department receives the claim directly from the hospital, the department shall pay a hospital's rate established according to this section subject to the following:

(a) If the hospital's bill is paid within thirty days of the date the bill was received, the department shall pay ninety-nine percent of the rate.

(b) If the hospital's bill is paid after thirty days but within sixty days of the date the bill was received, the department shall pay one hundred percent of the rate.

(c) If the hospital's bill is paid any time after sixty days of the date the bill was received, the department shall pay one hundred percent of the rate plus a fee of one percent per month for each month or portion of a month following the sixtieth day of receipt of the bill until the date of payment.

6. For medical services other than those for which a rate has been established pursuant to section 36-2903.01, subsection G, the department shall pay according to the Arizona health care cost containment system capped fee-for-service schedule adopted pursuant to section 36-2904, subsection K or any other established fee schedule the department determines reasonable.

H. The department shall not pay claims for services pursuant to this section that are submitted more than nine months after the date of service for which the payment is claimed.

I. To assist in the location of persons or assets for the purpose of establishing paternity, establishing, modifying or enforcing child support obligations and other related functions, the department has access, including automated access if the records are maintained in an automated database, to records of state and local government agencies, including:

1. Vital statistics, including records of marriage, birth and divorce.

2. State and local tax and revenue records, including information on residence address, employer, income and assets.

3. Records concerning real and titled personal property.

4. Records of occupational and professional licenses.

5. Records concerning the ownership and control of corporations, partnerships and other business entities.

6. Employment security records.

7. Records of agencies administering public assistance programs.

8. Records of the motor vehicle division of the department of transportation.

9. Records of the state department of corrections.

10. Any system used by a state agency to locate a person for motor vehicle or law enforcement purposes, including access to information contained in the Arizona criminal justice information system.

J. Notwithstanding subsection I of this section, the department or its agents shall not seek or obtain information on the assets of an individual unless paternity is presumed pursuant to section 25-814 or established.

K. Access to records of the department of revenue pursuant to subsection I of this section shall be provided in accordance with section 42-2003.

L. The department also has access to certain records held by private entities with respect to child support obligors or obligees, or individuals against whom such an obligation is sought. The information shall be obtained as follows:

1. In response to a child support subpoena issued by the department pursuant to section 25-520, the names and addresses of these persons and the names and addresses of the employers of these persons, as appearing in customer records of public utilities, cable operators and video service providers.

2. Information on these persons held by financial institutions.

M. Pursuant to department rules, the department may compromise or settle any support debt owed to the department if the director or an authorized agent determines that it is in the best interest of this state and after considering each of the following factors:

1. The obligor's financial resources.

2. The cost of further enforcement action.

3. The likelihood of recovering the full amount of the debt.

N. Notwithstanding any law to the contrary, a state or local governmental agency or private entity is not subject to civil liability for the disclosure of information made in good faith to the department pursuant to this section. END_STATUTE

Sec. 2. Repeal

Section 41-3025.06, Arizona Revised Statutes, is repealed.

Sec. 3. Title 41, chapter 27, article 2, Arizona Revised Statutes, is amended by adding section 41-3026.14, to read:

START_STATUTE41-3026.14. Arizona department of housing; termination July 1, 2026

A. The ARizona department of housing terminates on July 1, 2026.

B. Title 41, chapter 37 and this section are repealed on January 1, 2027. END_STATUTE

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

START_STATUTE41-3953. Department powers and duties; definition

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 96-399, 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. The annual reports submitted pursuant to this paragraph shall also include all of the following outcome-based metrics:

(a) The number of affordable housing units developed in this state.

(b) any Changes in homelessness rates in this state due to permanent supportive housing initiatives.

~~The annual reports pursuant to this paragraph shall also include all of the following outcome based metrics:~~

(a~~) The number of affordable housing units developed.~~

(b~~) any Changes in homelessness rates in this state due to permanent supportive housing initiatives.~~

(c~~) Any Improvements in housing accessibility for underserved and rural populations in this state.~~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 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.

L. For the purposes of this section, "PERMANENT SUPPORTIVE HOUSING" MEANS LONG-TERM HOUSING ASSISTANCE PAIRED WITH SUPPORTIVE SERVICES AIMED AT INDIVIDUALS EXPERIENCING HOMELESSNESS OR individuals WITH SPECIAL NEEDS. END_STATUTE

Sec. 5. 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. 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. Except as authorized by law, fund monies may not be spent on any down payment assistance programs that aid with the purchase of properties in this state.

E. F. 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 operating, constructing or renovating facilities for housing for low-income families and that provide housing and shelter to families that have children.

G. All programs established by the department and funded by the housing trust fund pursuant to this section shall require prior review by the Joint Legislative Budget Committee.

[~~F. All programs created and funded by the housing trust fund pursuant to this section shall require prior approval by the Joint Legislative Budget Committee.~~]F. H. 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. I. Monies in the housing trust fund are exempt from the provisions of section 35-190 relating to lapsing of appropriations.

H. J. 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. K. 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_STATUTEL. For the purposes of this section, "PERMANENT SUPPORTIVE HOUSING" MEANS LONG-TERM HOUSING ASSISTANCE PAIRED WITH SUPPORTIVE SERVICES AIMED AT INDIVIDUALS EXPERIENCING HOMELESSNESS OR WITH SPECIAL NEEDS.

Sec. 6. Title 41, chapter 37, article 2, Arizona Revised Statutes, is amended by adding section 41-3958, to read:

START_STATUTE41-3958. Comprehensive performance measurement system; tracking system; wire transfer protocols; reporting requirements; definitions

~~4.Department duties; performance measurement system; tracking system; wire transfer protocols; reports; definitions~~A. The department shall:

1. establish and implement a comprehensive performance measurement system within twelve months after the effective date of this section. The system shall require all of the following:

(a) Annual goals with measurable benchmarks for each housing program in this state.

(b) Mechanisms for data collection and review to assess the effectiveness of the housing programs in this state.

(c) Quarterly reporting to the president of the senate and the speaker of the house of REPRESENTATIVES regarding program performance outcomes, suggested improvements for affordable housing, reductions in homelessness and other key metrics.

2. conduct a biennial evaluation of all housing programs in this state to assess program alignment with state housing goals and ensure compliance with all statutory requirements.

3. establish secure wire transfer protocols to mitigate fraud risks, including all of the following:

(a) Dual authorization for all wire transfers exceeding $10,000.

(b) Real-time fraud detection and reporting measures integrated into the financial management system.

4. conduct biennial reviews of regulatory fees associated with manufactured housing in this state to ensure alignment with regulatory costs. Any proposed fee changes shall be submitted to the Board of Manufactured Housing established by section 41-4009 for approval and are subject to a thirty-day public comment PERIOD. ALL complaints related to manufactured housing must be resolved within one hundred twenty days.

5. establish a tracking system that Monitors complaint resolution timelines. The department shall provide quarterly reports regarding any unresolved complaints to the Board of Manufactured Housing, the president of the senate and the speaker of the house of representatives.

B. Any instance of fraudulent activity involving state monies shall be reported to the governor, the Joint Legislative Budget Committee and the Auditor General within ten business days. Restitution efforts shall be initiated within thirty days after identifying the fraudulent activity.

C. For the purposes of this section:

1. "Comprehensive performance measurement system" means A systematic process for tracking, evaluating and reporting on program outcomes, including establishing goals, performance benchmarks and measurable outcomes.

2. "Wire transfer protocols" means Secure processes and standards to prevent unauthorized financial transfers. [~~The department shall:~~

~~1. establish and implement a comprehensive performance measurement system within twelve months of the effective date of this section. The system shall include all of the following:~~

(a~~) Annual goals with measurable benchmarks for each housing program in this state.~~

(b~~) Mechanisms for data collection and review to assess the effectiveness of programs in this state.~~

(c) Quarterly reporting to the president of the senate and the speaker of the house of REPRESENTATIVES regarding program performance outcomes, suggested improvements in affordable housing, reductions in homelessness and other key metrics.

~~2. conduct a biennial evaluation of all housing programs to assess the programs alignment with state housing goals and ensure compliance with all statutory requirements.~~

~~3. establish secure wire transfer protocols to mitigate fraud risks, including all of the following:~~

(a~~) Dual authorization for all wire transfers exceeding $10,000.~~

(b~~) Real-time fraud detection and reporting measures integrated into the financial management system.~~

(c~~) Mandatory reconciliation and auditing of all wire transfers on a monthly basis.~~

4. conduct biennial reviews of regulatory fees associated with manufactured housing in this state to ensure alignment with actual regulatory costs. Any proposed fee changes shall be submitted to the Board of Manufactured Housing pursuant to section 41-4009 for approval and is subject to a thirty-day public comment period.

~~B. Any instance of fraudulent activity involving state monies shall be reported to the governor, the Joint Legislative Budget Committee and the Arizona Auditor General within ten business days.~~ ~~Restitution efforts shall be initiated within thirty days of identifying the fraudulent activity.~~

~~C. For the purposes of this section:~~

1. "Comprehensive performance measurement system" means A systematic process for tracking, evaluating, and reporting on program outcomes, including establishing goals, performance benchmarks, and measurable outcomes.

~~2. "manufactured housing accountability" means Standards ensuring compliance with housing complaint resolution timelines and cost assessments for regulatory activities.~~

~~3. "Permanent supportive housing accountability" means Long-term housing assistance paired with supportive services aimed at individuals experiencing homelessness or with special needs.~~

~~4. "Wire transfer protocols" means Secure processes and standards to prevent unauthorized financial transfers.~~] END_STATUTE

Sec. 7. Quarterly reporting; delayed repeal

A. The Arizona department of housing shall provide quarterly reports to the president of the senate and the speaker of the house of representatives regarding the use of monies from the housing trust fund pursuant to section 41-3955, Arizona Revised Statutes, as amended by this act, that includes all of the following:

1. Details on all financial transactions in the housing trust fund.

2. Detailed information on recipients of monies from the housing trust fund and any projected and realized results and analyses of the performance of the housing trust fund in comparison to the goals of the housing trust fund.

B. The Arizona department of housing shall also conduct a review of approved and paid payment requests since July 1, 2021 to identify any improper payments made to grantees and how to recover those monies. The status of the review and recovery activities shall be outlined in the quarterly reports pursuant to subsection A of this section.

C. This section is repealed from and after December 31, 2026.

Sec. 8. Purpose

Pursuant to section 41-2955, subsection B, Arizona Revised Statutes, the legislature continues the Arizona department of housing to address the affordable housing issues confronting this state, including housing issues of low and moderate income families, housing affordability, housing for special needs populations and decaying housing stock, to maintain standards of quality and safety for manufactured homes, factory-built buildings, mobile homes and accessory structures and to adjudicate complaints regarding and ensure compliance with the Arizona mobile home parks residential landlord and tenant act.

Sec. 9. Auditor general; special audit; report; delayed repeal

A. The auditor general shall conduct a special audit, as defined in section 41-1278, Arizona Revised Statutes, of the amount of monies spent on programs and services for individuals experiencing homelessness in this state for the past five years, including all of the following:

1. Expenditures by this state.

2. Expenditures by municipalities and counties for all of the following:

(a) Housing, rental assistance, outreach and supportive services.

(b) Emergency and law enforcement responses.

(d) Mental health, behavioral health and substance use disorder treatment and case management.

3. Expenditures of federal monies allocated to this state for homeless programs.

4. Expenditures by state and local law enforcement agencies to address homelessness, including transportation to emergency shelters, responding to crisis calls, providing overnight shelter in jail and enforcing camping bans.

B. All state agencies and local governmental entities of this state and organizations serving as continuum of care collaborative applications for the three continuums of care recognized by the United States department of housing and urban development shall cooperate with the special audit and grant access, at no cost, to all financial records and any other information necessary to complete the special audit.

C. The special audit shall examine all of the following:

1. The awarding of any contracts and grants relating to homeless services and support.

2. Any metrics used to examine the success of any expenditures.

3. The efficiency of the use of data management systems in relation to the programs.

4. The expenditure for each individual experiencing homelessness for each service provided.

5. Anonymized homeless management information system individual-level data paired with state health and criminal justice data.

D. On or before December 31, 2026, the auditor general shall submit copies of the special audit report to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of this report to the secretary of state.

E. This section is repealed from and after June 30, 2027.

Sec. 10. Appropriation; auditor general; special audit; exemption

A. The sum of $1,650,000 is appropriated from the housing trust fund established by section 41-3955, Arizona Revised Statutes, in fiscal year 2025-2026 to the auditor general for the purposes of conducting the special audit pursuant to section 5 of this act.

B. The appropriation made in subsection A of this section is exempt from the provisions of section 35-190, Arizona Revised Statutes, relating to lapsing of appropriations. All monies remaining unencumbered and unexpended for the purposes of this section on August 31, 2027 revert to the housing trust fund.~~All monies remaining expended and unencumbered on August 31, 2027, shall revert back to the Arizona department of housing trust fund~~

5. ~~for the past five years for all of the following:~~

(a~~) Housing, rental assistance, outreach and supportive services.~~

(b~~) Emergency responses and law enforcement.~~

(c~~) Public rights of way maintenance, sanitation and encampment mitigation.~~

(d) Mental health, behavioral health and substance use disorder treatment and case management. and organizations serving as continuum of care collaborative applications for the three continuums of care recognized by the United States department of housing and urban development,

~~5. Anonymized HMIS individual-level data paired with state health and criminal justice data.Sec.~~ ~~Performance audit; report; delayed repeal~~

A. The auditor general shall conduct a special audit, as defined in section 41-1278, Arizona revised statutes, of the amount of monies spent on programs and services for individuals experiencing homelessness in this state, including all of the following:

~~1. Expenditures by this state.~~

~~2. Expenditures by municipalities and counties with homeless populations higher than the per capita average of this state.~~

~~3. Expenditures of federal monies allocated to this state for homeless programs.~~

B. All state and local governmental entities of this state shall cooperate with the special audit and grant access, at no cost, to all financial records and any other information necessary to complete the special audit.

~~C. The special audit shall examine all of the following:~~

~~1. The awarding of any contracts and grants relating to homeless services and support.~~

~~2. Any metrics used to examine the success of any expenditures.~~

~~3. The efficiency of the use of data management systems in relation to the programs.~~

~~4. The expenditure for each individual experiencing homelessness for each service provided.~~

~~E. This section is repealed from and after June 30, 2027.~~

Sec. 11. Retroactivity

Sections 2 and 3 of this act apply retroactively to from and after July 1, 2025.