ARIZONA STATE SENATE
Legislature, Second Regular Session
FACT SHEET FOR H.B. 2003
correction; nonprofit corporations
†††††††††† Authorizes the establishment of a Revitalization
District for the purposes of infrastructure development in one or more cities
or tribal entities.
Special taxing districts, often referred to as special
districts, are usually created to fill a need and to enable the provision of
services in an area that might otherwise be limited from receiving those
services for various reasons, including size, location, financial limitations
or unavailability of other government support.† The formation of a special
taxing district creates a funding stream to pay for the desired or needed
services by placing the responsibility on those who benefit from that service.
currently allows and specifies the process for the formation of more than 30
special taxing districts, such as fire districts, irrigation districts,
hospital districts, pest abatement districts and power districts.† Although the
specific process depends on the type of district to be created, in many cases
formation requires the submission of petitions to the county board of
supervisors, followed by a public hearing.† Sometimes, an election may be
required for final approval of district formation. The procedures for the
establishment of certain types of districts, such as stadium districts, differ greatly.
Unless otherwise specified by statute, the county board of supervisors has the
absolute authority to deny the formation of a special district in that county
if sufficient grounds exist for the denial, but any denial may be subject to
Statute also prescribes mechanisms for the dissolution
of districts and methods for changing district boundaries.
There is no anticipated impact to the state General
Allows the governing body of one or more municipalities or Indian tribes
to adopt a resolution of intention to form a Revitalization District (district)
public health and necessity require;
property owners of at least 51 percent of the net assessed value of the
affected property present a petition;
least 51 percent of the property owners in the area proposed to be included in
the district present a petition.
Requires a General Plan to be filed with the appropriate city clerk that
outlines the general description of the proposed area and improvements for
which the district is formed.
Governs by a district board and outlines the membership of the board,
depending on the number of municipalities or Indian tribes participating in the
Outlines the terms of office for the initial and subsequent board of
Contains requirements for the contents of the resolution of intention.
Requires the city clerk mail a notice of the date and time of the public
hearing and a copy of the resolution of intention to the owners of real
property in the district.†
Requires the city clerk to publish a copy of the notice and resolution
of intention in a newspaper at least 20 days before the hearing.
Allows any person claiming an interest in real property located in the
district to file a written objection with the city clerk before 5:00 p.m. on
the business day preceding the hearing.†
Stipulates that the objection may raise one or more of the following:
the property will not benefit from the improvements and should be excluded from
the district should not be formed, including the specific reasons; and
the General Plan should be modified, including the reasons for modification.
the governing body to hear and pass only on the written objections and the
testimony and evidence presented in support of or opposition to the objections.
that testimony need not be given under oath, unless requested by any owner or
as required by the governing board.
all minutes, copies of transcripts, tape recordings or proceedings to be made
available to the public three working days after the hearing concludes. A
charge not to exceed the actual cost of reproducing the items is allowed.
Forming the District
the governing body of each entity to adopt a resolution after the hearing that
does one of the following:
the district, deleting any property determined not to benefit from the
the General Plan and then forms the district; or
not to form the district.
a resolution that forms the district to state the names of the initial
directors and their terms of office.
a process for judicial review where the affected owner or interested person who
went through the process of presenting evidence at the hearing and providing
testimony may petition for special action with the court of appeals.
the process, procedures and timeframes.
the governing body of each entity, upon formation of the district, to:
the initial board of directors;
the district boundaries;
that a map of the districtís boundaries be drawn; and
d) cause a
copy of the order forming the district to be delivered to the county assessor,
the board of supervisors, and the Department of Revenue.
a notice of the formation of the district to be recorded with the county
a resolution to be approved by each participating municipality or Indian tribe
before the district may be deemed formed.
the new district a special purpose district, a special tax-levying district and
a municipal corporation.† The district is considered a municipal corporation
and political subdivision of Arizona, separate from the municipality.
that the district does not have the power of eminent domain or the power to
enact zoning ordinances.
the district board to reasonably implement and administer the General Plan.
Powers of the
the following powers to a district, in addition to other powers and authority
granted to districts:
into contracts and spend monies for infrastructure;
into intergovernmental agreements (IGAs), including IGAs with an Indian tribe,
for the planning, design, inspection, ownership, control, maintenance,
operation or repair of infrastructure or for the enhancement of municipal
services by the municipality in the district;
lease or otherwise dispose of district property if the sale, lease or conveyance
is not a violation of the terms of any contract or bond resolution of the
a municipality for providing enhanced municipal services in the district;
maintain and repair infrastructure;
charge and collect user fees, rates or charges for the use of any
infrastructure or service;
staff, counsel and consultants;
a municipality for staff and consultant services and support facilities
supplied by the municipality;
accept gifts or grants and incur/repay loans for any infrastructure
enter into agreements with landowners and the municipality for the
collection of fees and charges from landowners for infrastructure purposes, the
advance of monies by landowners for infrastructure purposes or the granting of
real property by the landowner for infrastructure purposes;
the approval of the voters, levy and assess for the costs of any infrastructure
on any benefitted land in the district;
pay the financial, legal and administrative costs of the district;
m) enter into
contracts, agreements and trust indentures to obtain credit enhancement or
liquidity support for its bonds and process the issuance, registration,
transfer and payment of its bonds and the disbursement/investment of the
proceeds of the bonds;
the proper consent, enter into agreements with persons outside of the district
to provide services to persons and property outside of the district; and
public easements and rights-of-way as outlined.
the district to contract, enter into IGAs, adopt/change a seal, sue and be
sued, and enter into development agreements.
the district from financing, acquiring, operating, maintaining, constructing or
operating a sports stadium or other related facilities.
that public infrastructure may only be located in or on state, county,
municipality or district lands or lands otherwise designated as public
roadways, highways, streets, thoroughfares or rights-of-way.
that the district has perpetual succession, except that the district may be
dissolved as provided by law.
the district 10 years after the date of formation unless the governing bodies
of the participating municipalities by resolution,† extend the district an
additional 10 years.
Records and Meetings
minutes, resolutions, accounts receivable and payable, annual budgets and all
other required records to be open public records.
requirements for the board members, including terms of office and filling
the district clerk and district treasurer as those serving the relevant city or
county, unless otherwise stipulated by the district board.
the district to follow public meetings and proceedings laws as prescribed by
the governing body of a municipality, by resolution, to order the participation
of the municipality in the costs of any infrastructure purposes, including the
payment of bond debt service.
General Plan projects to be financed from the following sources of revenue:
from the sale of district bonds,
or tribal monies contributed to the district,
or federal grants or contributions,
landowner and other fees and charges,
of loans or advances, and
any other monies available to the district by law.
the district treasurer to prepare a proposed budget by July 15 of each year.
the district board to approve the budget, by resolution, by October 1 of each
participating entities to submit written comments for the budget hearing
the district board to hold a hearing on the question of the authorization to
issue revenue bonds to provide monies for infrastructure purposes.
the district board to issue and sell revenue bonds if approved by resolution.
bonds sold at a public offering to receive one of the four highest investment
grade ratings by a nationally recognized bond rating agency.
the district board to pledge any district revenues to the payment of its
the district to prescribe fees and charges to generate sufficient revenues for
payment of principal and interest.
any bond holder from compelling any district or municipality to exercise taxing
power to pay the bonds or their interest.
that the revenue bonds are not a debt of the district or municipality, nor is
the payment of revenue bonds enforceable out of monies other than the pledged
payment of the bonds.
the district to issue and sell refunding bonds in order to refund any revenue
the district board, after approval at an election and according to the process
and procedures of current law, to levy an assessment of the costs, maintenance
and operation of any infrastructure purpose, or any enhanced municipal services
on land in the district based on the benefit determined by the district board.†
the district to enter into a written agreement with a landowner regarding the
manner in which the assessment is to be allocated if the land is to be divided
into more than one parcel.
specific requirements if special assessment lien bonds finance more than one
purpose or service.†
a land owner to seek judicial review of whether land is benefitted by the
the adoption of a resolution by the district board to levy a special assessment
of property in the district, outlines proper issuance, sales, permissive funds,
including reserve funds, and collections through agreement with the county
that the assessment shall be a first lien on the property assessed, subject
only to general property taxes and prior special assessments. Outlines
procedures in the event of any nonpayment of an assessment.
that on adoption of the resolution, but before issuing the Special Assessment
Lien Bonds, the district may direct the county treasurer to require the owners
of the assessed property to make advance payment.† Outlines specific
the district to issue and sell refunding bonds in order to refund any special
Terms of Bonds
the district board to determine the denominations of the bonds, the size of
each issue and the form of the bonds.
the district board to establish the maturities, interest payment dates and
interest rates, whether fixed or variable, but not to exceed the maximum rate
stated in the notice of the election or resolution.
the bonds to be sold by competitive bid or negotiated sale for public or
private offering at, below or above par.
the bonds to contain such terms, conditions, covenants and agreements as the
district board deems proper.
that bonds may be payable from any combination of taxes, revenues or special
assessments of the types of allowed by law if all applicable requirements are
the district board or governing body to call an election on the authorization
to levy an ad valorem tax on the assessed value of all real and personal
property in the district at a rate not to exceed the maximum rate specified in
that all taxes for district maintenance and operations must not exceed $0.30
per $100 of assessed valuation for all real and personal property in the district,
unless a higher rate is approved by a petition signed by the owners of at least
51 percent of the net assessed value of the property of the district and a
petition signed by at least 51 percent of the property owners of the district.
the district board to reduce or eliminate any portion of the tax by simple
the district from levying at a rate in excess of the maximum rate then in
effect, except for the payment of debt service on bonds.
the district board to make annual statements and estimates of maintenance and
operation expenses of the district, cost of capital improvements and the amount
of all other expenditures for public infrastructure and enhanced municipal
services proposed to be paid from the tax levy as well as the amount raised to
pay bonds of the district.† The district board must file the annual statements
and estimates with the clerk.†††
notice of an election to be posted in three public places within the district
not less than 20 days before the election.† Also requires notice to be
published in a newspaper of general circulation.
requirements on the contents of the notice.
that only owners of real property in the district are eligible to vote in an
election regarding an assessment levied against real property or in an election
for the board of directors.
corporations, partnerships and other business entities to vote as property
owners, but only one vote may be cast for each one-seventh of an acre of real
property in the district.
that the election follows the General Election laws of the state of Arizona.
the district board to meet and canvass the returns within 14 days after an
the district board to dissolve the district by resolution if all property is
conveyed to the municipality and either the district has no obligations or the
municipality has assumed them.
the district board to dissolve the district if both a) the governing body
consents and voters approve the dissolution or the district has been inactive
for at least five years and b) the district board adopts a resolution
dissolving the district.
the district board to call an election for dissolution and requires that an
election be called if at least 10 percent of the qualified electors of the
district submit a petition to that effect.
the election to be called and held in the same manner as a bond or tax levy
all pertinent property in the District remains subject to the lien for the
payment of general obligation bonds, and any property subject to a special
assessment lien remains subject to the lien.† The District may not be dissolved
if any revenue bonds are outstanding unless sufficient money is available to
make all payments due.† Permits the District to operate after its dissolution
only as needed to collect money and make payments as necessary.
the director of the Arizona State Retirement System (ASRS) to be notified if a
proposal for dissolution is approved and the district was an ASRS employer
before the dissolution.
effective on the general effective date.
Amendments Adopted by the Finance Committee
the requirements for district formation.
a reporting requirement for district dissolution.
Amendments Adopted by the Committee of the Whole
that a district may not finance or otherwise support a sports stadium or other
the requirements for raising the districtís tax rate above the maximum rate.
the district board to reduce or eliminate any portion of the tax by simple
House Action††††††††††††††††††††††††††††††††††††††††††††††††††††††††††††† Senate
COM†††††††††††††† 2/17/10†††† DPA/SE†††† 8-0-0-0 †††††††††† FIN†††††††††††††††† 3/7/10† ††††
3rd Read†††††††††† 3/23/10††††††††††††††††††††††† 42-12-6-0††††††† 3rd
Read†††††††††† 4/29/10††††††††††† ††† 21-6-3-0
Final Read†††††† 4/29/10††††††††††††††††††††††† 38-20-2-0
Signed by the Governor 5/11/10
Prepared by Senate Research
May 24, 2010