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HomeMy WebLinkAbout04/04/2006 Blue Sheet State Legislative Issues TOWN COUNCIL MEETING INFORMATION MEETING DATE: TOWN OF MARANA April 4, 2006 AGENDA ITEM: K.4 TO: MAYOR AND COUNCIL FROM: Michael A. Reuwsaat, Town Manager SUBJECT: State Leeislative Issues: DiscussionIDirection/Action regarding all pending bills before the Legislature DISCUSSION This item is scheduled for each regular council Meeting in order to provide an opportunity to discuss any legislative item that might arise during the current session of the State Legislature. Periodically, an oral report may be given to supplement the Legislative Bulletins. ATTACHMENTS Legislative Bulletin, Issues 10 and 11. RECOMMENDATION Upon the request of Council, staff will be pleased to provide recommendations on specific legislative issues. SUGGESTED MOTION Mayor and Council's pleasure. JCB/03/29/2006/4:37 PM IN THIS ISSUE Impact Fee Bill Passes the House . . . . . . . . . . . . . . . . 1 Update on State Shared Revenue Attacks .................. 1 Eminent Domain Negotiations Continue. . . . . . . . . . . . . . . . . 2 Tax Incentive Penalty Bill Passes Committee ............... 2 Liquor License Bill Passes the House . . . . . . . . . . . . . . . . . . . 3 Last Minute Amendments Added to Election Law Bill ......... 3 Updates on Other Legislation . 3 League of Arizona ~II~ Cities AND Tovvns Legislative Bul/etin is published by the League of Arizona Cities and Towns. FOlWard your comments or suggestions to: League of Arizona Cities & Towns 1820 West Washington Street Phoenix, Arizona 85007 Phone: 602-258-5786 Fax: 602-253-3874 Email: league@mg.state.az.us Internet: www.azleague.org LEG IS LA liVE BU LLEll N Issue No.1 0 March 17,2006 * ACTION ALERT * IMPACT FEE BILL PASSES THE HOUSE HB2381 passed the House on Monday with a 37-23 vote. As passed by the House, this bill proposes to place mandates and limitations on how municipalities can assess and use impact fees, which are a vital growth management tool used to mitigate the impacts of new growth on the general public by requiring new growth to pay for itself. The bill mandates that a developer receive reimbursement if future developments are assessed impact fees and receive beneficial use of the improvements financed with the original development's impact fees. While such a credit plan might be appropriate in some circumstances, it should not be a mandate imposed on every future impact fee. Such a mandate would encourage urban sprawl and leapfrog development, as developers would be assured eventual reimbursement for the extension of infrastructure when leapfrog development is constructed. Conversely, such a credit mandate would not support infill efforts as infill developments would be essentially paying back the developers of the urban sprawl for the infrastructure needed to support that sprawl. For municipalities with populations over 35,000, the bill also requires any revenue raised from construction sales tax rates higher than the other average local tax rates to be dedicated to infrastructure projects specific to the new development. This is far too great of a limitation, as most public infrastructure is not constructed for the exclusive use of a particular development. A freeway project, major road widening, or new fire station might be needed to address the increased public service demands of a new development, but they will not exclusively serve that new development so the ability to use construction sales tax revenue for those types of projects would come into question. The League has offered to work with the Homebuilders on language that will provide safeguards to developers wanting to be assured that their fees will be used to support their developments. The League has also committed to work on any outstanding issues not addressed in our compromise over the summer when a more thorough and deliberative review of the issue can occur. This bill has been assigned to the Senate GovernmentAccountability and Reform Committee and is scheduled to be heard on Wednesday. The League will continue to oppose the bill in its current form and continue to work with the Homebuilders on language that addresses their issues without negatively impacting your ability to charge and use development fees as appropriate for your city or town. ACTION REQUESTED: Please contact your Senators and ask them to oppose HB2381. As currently drafted the bill would have a substantial financial impact to cities and towns and will also impose a substantial impediment to growth management. * ACTION ALERT * UPDATE ON STATE SHARED REVENUE ATTACKS One of this session's attacks on state shared revenue was thwarted on Wednesday, when the House failed to pass HB2837 with a 23-32 vote. This bill prevented a city with "any sanctuary policy" or "reduced enforcement" regarding immigration from receiving state shared revenue. These terms are vague and no effort is made to define them in the legislation. In addition, the State Treasurer would have the authority to unilaterally determine that a municipality is in violation and can withhold their funding. State shared revenue was passed by the voters statewide to provide revenue for local government services such as police, fire protection and parks. The voters did not place conditions on when a city or town should receive that funding, as proposed by this bill. Arizonans directed shared revenues to go to cities and towns to help assure that quality local services are provided in their communities and it's these same citizens that will suffer if this bill is enacted. The League thanks the many Representatives that voted 'no' on this bill. However, a motion to reconsider the bill passed yesterday setting up another vote on the House floor this Monday. The other major threat to state shared revenues is SB1408. Sponsored by Sen. Bob Burns, this bill phases out revenue sharing to cities over 100,000 over a period of 10 years. This bill will have huge financial impacts to the State's largest cities and will have a detrimental effect on their ability to provide services to their citizens. This bill has not moved, since it was caucused in early February. As such, we speculate that this bill does not have the support to pass but it could begin to move again at any time. Protecting state shared revenues is a priority for the League; we will continue to watch this bill carefully and work to stop it if it again becomes an issue. ACTION REQUESTED: Please contact your Representatives by early Monday and ask them to vote "no" on HB2837 when it is reconsidered on the House Floor likely on Monday afternoon. * ACTION ALERT * EMINENT DOMAIN NEGOTIATIONS CONTINUE The League and many other stakeholders are continuing to meet with legislative leadership in our effort to limit the scope of the eminent domain discussions. We have proposed eliminating the 20 various bills on the subject and creating a single bill that outlines safeguards for the property owner but still allows cities and towns to condemn as necessary to eliminate slum and blight. We have also continued to insist that the regulatory takings language in SCR1 019 and HCR2031 be taken out of any bill that moves through the process. As currently drafted, the regulatory takings provisions would effectively eliminate planning and zoning and set up countless takings lawsuits funded at the taxpayers' expense. While leadership continues to assure us that they are continuing negotiations, many of the introduced eminent domain bills are continuing to move through the process. The bills that are not part of the negotiations that continued to move this week are: HB2675, which eliminates the ability to condemn for blight and makes substantial changes to the process for slum condemnations, passed the Senate Government Committee 4-2 on Thursday. HB2062, which increases the requirements and potential costs for all condemnation actions, not just redevelopment, passed the Senate Government Committee 4-2 on Thursday. HB2063, which prohibits condemnation discussions in executive session, except for legal advice, passed the Senate Government Committee 4-2 on Thursday. HB2736, which makes changes to required appraisals in condemnation cases and requires the government to refund property taxes paid on the property during the condemnation period, passed the House on third read 31- 23-5. Both SCR1019 and HCR2031 were scheduled for floor action this week despite the agreement to use these as compromise bills. There is still discussion of taking out the regulatory takings language included in these resolutions but we will continue to oppose them until those amendments are adopted. ACTION REQUESTED: Please continue to contact your legislators and express your concerns about the far-reaching consequences of all the eminent domain bills. We are willing to reform the redevelopment process, but language regarding general condemnation authority and regulatory takings must be stricken from the legislation. Also express your concern about the movement of all these bills in addition to any compromise bills. * ACTION ALERT * TAX INCENTIVE PENALTY BILL PASSES COMMITTEE SB1243, which penalizes a city for using tax incentives to encourage economic development by withholding the same amount from the city's state shared revenue, passed the House Ways and Means Committee on Monday with a 6-0 vote. This bill preempts locally elected officials' decisions on local sales tax, which is purely a local government issue. The bill will hinder the ability of cities and towns to attract new retail and economic growth to their communities. With the passage of this bill in committee, it could be ready for floor consideration as early as the end of next week. The League is advocati ng the passage of H B273 7/ sponsored by Rep. John Nelson, as the better alternative. Rather than penalize cities for using incentives, HB2737 caps the LEGISLATIVE BULLETIN PAGE 2 March 1 7/ 2006 amount of the incentive to no more than one-half of one percent of the sales generated at the site and a fixed gross dollar amount for the duration of the incentive that the city must fix when entering the incentive agreement. The bill enables the continuation of retail incentives but would offer protections against the escalation of bidding wars between taxing jurisdictions. The bill passed the House earlier in the week and moved over to the Senate where it has been assigned to the Government Committee. Action Requested: Please contact your Representatives and express your opposition to SB1243. This is a local decision that helps cities attract new growth and should not be punished by the State for using this valuable tool. LIQUOR LICENSE BILL PASSES THE HOUSE The House voted 32-28 on Monday to pass HB2740, which may encourage businesses to circumvent current liquor laws. With this bill, there will be no incentive to maintain proper food sales. Under the provisions of the bill, an establishment with a restaurant license can convert to a grill license if their food sales fail to meet the 40% food sale requirement provided they reach a 30% level. Establishments will be able to obtain a restaurant license and operate as a bar until they are notified of an audit, at which time they can use the provisions of this bill to avoid the high costs and stricter laws of obtaining and using a bar liquor license. The League is also concerned that this bill allows the holder of a restaurant license to convert to a bar or beer/wine license and be grandfathered from the distance requirements for proximity to churches, schools, playgrounds, etc. if the restaurant was there first. In addition, many of the other provisions lack specificity and seem to work towards creating loopholes in the current system. This bill has not yet been assigned to a committee in the Senate. We will continue to fight this bill in the Senate, as it will have detrimental effects on neighborhoods across the State. LAST MINUTE AMENDMENTS ADDED TO ELECTION LAW BILL SB1395, which makes numerous changes to election law statutes, was amended several times in Committee of the Whole this week. One of these amendments preempts cities with populations over 175,000 from holding candidate elections during the spring cycle. Fall ballots are often very crowded and spring elections provide citizens with a greater ability to focus on city issues and candidates. Some communities prefer fall elections but the discretion to have spring elections should not be preempted. This bill was third read in the Senate on Thursday, where it passed 19-10. It now moves to the House, where the League will continue to oppose this bill as long as it contains this provision. UPDATES ON OTHER LEGISLATION HeR 2001 is an important League resolution that increases the debt capacity for public safety and transportation projects from the 6% to the 20% level of your appraised value. The Mayors voted to make this a priority issue for the League, as it will enable cities and towns to prepare for the continued explosive growth in State population. An expanded bonding capacity will give municipalities the ability to adequately address public safety and transportation issues for their citizens. This expanded authority would still be subject to the passage of additional bond votes by the public. If this resolution passes through the Legislature, the issue will be placed on the next state ballot for the voters to decide. It passed out of the Senate Government Committee with a 6-1 vote on Thursday. HB2136 clarifies that cities and towns may use Construction Manager at Risk (CM@Risk), Design Build and Job Ordering Contracting for bond-financed capital projects. These financial tools are already used by many cities and towns and can help reduce the costs of constructing facilities and infrastructure. This bill was heard in the Senate Government Committee on Thursday, where it passed with a 7-0 vote. H B2220 gives code enforcement officers the same personal identity protections as police. This bill passed the Senate Government Committee on Thursday with a 6-1 vote. SB1413 appropriates $850,000 to be distributed to Arizona's smallest cities and towns to increase their funding floor to match a city or town with a population of 1500. This is a League Resolution and is sponsored by Sen. Tim Bee. This bill passed the Senate last week and was heard in the House Appropriations (B) Committee this week, where it passed 10-2. It now waits for a hearing in House Appropriations (P). SB1351 addresses the League Resolution to recruit and retain doctors in Arizona. This bill increases the burden of proof needed to bring a malpractice suit against an emergency room physician. It passed the Senate this week with a 16-13 vote. lEGISLATIVE BUllETIN PAGE 3 March 17,2006 IN THIS ISSUE Eminent Domain Bill Defeated On House Floor Compromise Talks Continue ............ 1 Impact Fee Bill Scheduled for Committee Hearing Next Week ..... . . . . . . . . .. 1 Setback for Small Town Revenue Bill......................2 State Shared Revenue Bill Fails on Reconsideration . . . . . . . . . 2 Election Law Bill Amended . . . 2 Inclusionary Zoning Bill Continues To Move. . . . . . . . . 2 Public Event Weapons Storage Bill Moves. . . . . . . . . . . . . . . . 2 R&D Tax Credit Continues to Move....................3 House of Representatives Third Read Vote . . . . . . . . . . . . . . . . 3 League of Arizona ~I~ Cities AND Towns Legislative Bulletin is published by the League of Arizona Cities and Towns. Forward your comments or suggestions to: League of Arizona Cities & Towns 1820 West Washington Street Phoenix. Arizona 85007 Phone: 602-258-5786 Fax: 602-253-3874 Email: league@mg.state.az.us Internet: www.azleague.org LEGISLATIVE BULLETIN Issue No. 11 March 24, 2006 * ACTION ALERT * EMINENT DOMAIN Bill DEFEATED ON HOUSE FLOOR, COMPROMISE TALKS CONTINUE After months of discussions with legislative leadership on eminent domain, the two bills that have received most of the attention on the issue were scheduled for floor votes without our compromise language. SCR1019 passed the Senate Wednesday with a 21-5 vote. The similar House version, HCR2031, failed in the House yesterday by a vote of 26-29. Many members expressed frustration that more changes were not made to the legislation prior to the floor vote. The failing vote sent a clear sign to the sponsor and leadership that members expect a reasonable bill to vote on. It is possible that this resolution could be reconsidered next week; the League will continue to encourage members to oppose the current language and work towards a reasonable compromise. Both bills still contain regulatory takings language that would effectively eliminate planning and zoning and set up countless takings lawsuits funded at the taxpayers' expense. In addition, two other eminent domain bills continued to move this week. The Federal Mandates and Property Rights Committee heard SB111 0 and SB1252 this week and passed both. SB1110 clarifies that an economic benefit, by itself, does not constitute a public use for the purposes of condemnation. While this is consistent with provisions in our compromise package, we oppose numerous separate bills moving forward and would prefer one consolidated reform bill. On the other hand, SB1252 is not consistent with our compromise and would award all attorney's fees and court costs to the defendant in a condemnation case, regardless of the outcome. Both of these bills are ready for the Rules Committee and could be heard on the floor as early as next week. Leadership continues to engage us in discussions and have indicated that additional changes will be made as the remaining bills are heard in the opposite chambers. The League and the many other stakeholders will continue to fight these bills as they are currently written and insist that the regulatory takings language in SCR1019 be removed. ACTION REQUESTED: With the defeat of HCR2031 yesterday, our supporters, who are advocating a compromise, have gained significant momentum for our cause. Please continue talking to your legislators, thanking those that voted against the HCR (the vote is included in the Bulletin) and urging all to continue working towards our compromise. * ACTION ALERT * IMPACT FEE Bill SCHEDULED FOR COMMITTEE HEARING NEXT WEEK HB2381 which would place mandates and preemptions on development fees, capital improvement plans, and construction sales tax is scheduled for a hearing in the Senate Commerce and Economic Development Committee next Wednesday. Negotiations on a compromiseare continuing to reach a compromise, one that would assure that impact fees are being used to support new growth and that credits are provided when an impact fee is assessed for projects that are never built. However, the current language goes way too far in regulating impact fees. In particular, development fee activities would have to be more extensively reported and updated in .ca~ital improvem.ent plans (CIP). Much of this new reportmg IS not appropnate for C1Ps and would be a tremendous burden to update. In addition, the bill places limitations on construction sales tax rates and limits how this sales tax revenue can be used. We will keep you informed on the progression of o~r discussions and if our position changes, but for now, the bill can not be supported. ACTION REQUESTED: Please contact your Senators and let them know that unless significant changes are made to the existing bill, we are requesting that they oppose HB2381 which is scheduled for a committee hearing on Wednesday. SETBACK FOR SMALL TOWN REVENUE BILL The House Appropriations (P) Committee scheduled SB1413, a League resolution that appropriates $850,000 to be distributed to small cities and towns with populations under 1,500, for a hearing on Wednesday. The committee then voted to approve a strike-everything amendment that removes the language regarding small town revenue and replaces it with a bill that regulates county development fees. This bill as amended passed with a 6-0 vote. This funding is critical to Arizona's small cities and would ensure their ability to provide a minimum level of municipal services. Since the bill was a general fund appropriation, it did not reallocate shared revenue in any manner. This bill passed the Senate 27-2 two weeks ago and passe? a diff~rent House Committee last week. The League will contmue discussions with the bill's sponsor, Sen. Tim Bee, to encourage him to address this issue this session. STATE SHARED REVENUE BILL FAILS ON RECONSIDERATION HB2837, which would have allowed the State Treasurer to withhold state shared revenue distributions from any city or town with a sanctuary or reduced enforcement policy relating to illegal immigration, as unilaterally determined by the Treasurer, failed on reconsideration Monday 26-28. State shared revenue was passed by the voters statewide to provide revenue for local government services such as police, fire protection and parks. The voters did not place conditions on when a city or town should receive that funding, as proposed by this bill. Arizonans directed shared revenues to go to cities and towns to help assure that quality local services are provided in their communities and it's these same citizens that would have suffered if this bill passed. The League thanks the many Representatives that maintained their 'no' vote on this issue. ELECTION LAW BILL AMENDED After a previous effort to mandate fall elections for lar~er cities and towns was blocked earlier in the session, two bills advanced this week with the mandate which would now be limited to candidate elections. SB1041 was amended on the House floor to address some municipal concerns with the language requirin.g cities a~d towns over 175,000 to hold fall candidate elections. While the bill still preempts local officials from determining the best election cycle for their city, the new language does address the possible need for spring candidate elections for recalls and to fill vacancies. SB1395, which contains the same provisions relating to the election cycle, passed out of the House Judiciary Committee on Thursday with a 5-2 vote. The League will continue to oppose both of these bills as they preempt the ability of larger municipalities to decide which election cycle is best for their community. INCLUSIONARY ZONING BILL CONTINUES TO MOVE SB1497 prohibits a city or town from requiring developers to build a certain number of homes at certain pricing levels often referred to as inclusionary zoning. While incentivizing affordable housing construction, such as providing developers with tax credits, is typically the preferred method, incentives may not always be enough to address housing problems. It is bad public policy to start limiting the means of addressing affordable housing issues with the dramatic population growth and rapidly escalating housing prices that we are experiencing in Arizona. The League continues to be part of the Governor's Affordable Housing Task Force to help develop other strategies for creating affordable living options for city residents and opposes this preemption. PUBLIC EVENT WEAPONS STORAGE BILL MOVES HB2076 requires any public event that does not allow weapons to have a storage facility where citizens can store their weapons during the event. The storage must be secure and the weapon must be available for 'immediate retrieval'. The bill does not provide a funding source for implementing these requirements and it also does not address government liability for storing, handling and returning weapons that are then used in crimes. HB2076 also expands the locations that one can place a firearm in a car without a concealed weapons permit to include"map pockets." The bill passed the Senate Judiciary Committee on Monday with an amendment that delays the effective date to lEGISLATIVE BUllETIN PAGE 2 March 24, 2006 January 1, 2009. This delayed date gives cities and towns some time to address logistics such as storage facilities and funding but the larger concern of liability remains unaddressed. The League will continue to oppose this bill. R&D TAX CREDITS CONTINUES TO MOVE HB2677 continued to move this week, passing the Senate Commerce and Economic Development Committee with a 5-2 vote. This League resolution encourages more research and development activities in the State. Providing such incentives may generate additional economic activity and create a local environment making Arizona more competitive in recruiting cutting-edge enterprises to the State such as the growing field of bioscience technology. Many cities are currently promoting these activities and this bill will further that cause. It now waits to be heard in the Senate Finance Committee before moving to the full Senate. HOUSE OF REPRESENTATIVES THIRD READ VOTE: HCR2031: COMPENSATION; LAND USE REGULATION A 'N' (or no) is a vote supporting the League's position: Kirk Adams Manuel V. "Manny" Alvarez Nancy K. Barto David T. Bradley Jennifer J. Burns Ted Carpenter Eddie Farnsworth Pamela Gorman Steve Huffman Laura Knaperek Phil Lopes Lucy Mason Debbie McCune Davis Ben R. Miranda Warde Nichols Russell K. Pearce Doug Quelland Bob Robson Bob Stump Jerry P. Weiers Y Amanda Aguirre N Mark Anderson Y Andy Biggs N Jack A. Brown N Meg Burton Cahill Y Cheryl Chase Y Steve Gallardo Y Trish Groe NV Russell L. Jones Y Bill Konopnicki NV Linda Lopez N Marian A. McClure N Nancy G. McLain N Rick Murphy Y Tom O'Halleran Y Gary L. Pierce Y Michele Reagan Y Colette Rosati Y Albert Tom Y Steven B. Yarbrough NV John M. Allen Y Ray Barnes Y Tom Boone N Judy Burges N Olivia Cajero Bedford N Ted Downing N Martha Garcia Y Pete Hershberger NV Ann Kirkpatrick N Leah Landrum Taylor N David M. Lujan N John McComish Y Robert Meza Y John B. Nelson N Jonathan Paton Y Tom Prezelski N Pete Rios Y Kyrsten Sinema N Stephen Tully Y James P. Weiers Y Y Y Y N N N N N N N Y N N NV N N N Y N LEGISLATIVE BULLETIN March 24, 2006 PAGE 3