School Safety

On Monday, Governor Ducey revealed his plan to focus on mental health services for students, boost law enforcement presence on school campuses, and closing loopholes in background checks. The plan, or some version of it, is expected to move forward this week if it is going to at all. Democrats at the Capitol have largely panned the plan for not going far enough, and many Republicans are wary of any additional measures to control access to guns.

Prop 301

A major success from last week included the passage of Senator Brophy McGee’s and Representative Coleman’s effort to ensure $640 million a year for public education in both the House and Senate. Although this was a victory for both sides, many Democrats wanted increases in teacher salaries that went further than the $18/week increase that would take effect in 3 years. The governor is expected to sign the bill early this week.

Priority Bills Recap

H2037 (Schools; Statewide College Readiness Examination)

Beginning in the 2018-19 school year, the State Board of Education is required to administer to all high school students a statewide college readiness examination that includes a science component. Beginning in the 2018-19 school year, the Board is prohibited from administering the statewide assessments of the state academic standards in reading, writing and mathematics to students in 11th grade, and from administering the assessments of the academic standards in science to high school students.

• 3/22: Amended in Senate Education; do pass

H2090 (Tax Credit Review; Evaluation Standard)

The standards used by the Joint Legislative Income Tax Review Committee to evaluate tax credits may include whether adequate protections are in place to ensure that the fiscal impact of the credit in future years does not increase substantially beyond the current projections

• 3/22: Amended in Senate Finance; do pass

H2106 (Corporation Commission; Internet Protocol Services)

A person that offers, furnishes or provides for profit or otherwise “internet protocol enabled service” or “voice over internet protocol service” (both defined) is not providing message transmission service to the public and is not a public service corporation. The Corporation Commission is prohibited from regulating, directly or indirectly, the entry, exit, rates, terms, conditions, or service quality standards of these services.

• THIS BILL HAS BEEN STRUCK ONTO HB2209 AND HAS PASSED COMMITTEE

H2154 (Personal Information; Data Security Breaches)

Numerous changes to statutes relating to data security breaches. Adds a new article to Title 18 (Information Technology) regulating data security breaches, and transfers several sections of current statute to the new article. If a person that conducts business in Arizona and that owns, maintains or licenses unencrypted and unredacted computerized personal information becomes aware of a “security system breach” (defined), the person is required to notify the individuals affected within 45 days. If the breach requires notification of more than 1,000 individuals, the person is also required to notify the three largest nationwide consumer reporting agencies and to notify the Attorney General in writing. Establishes a list of information that must be included in the notification to individuals affected by a breach. If a breach involves personal information that is publicly available for an online account, a person complies with these requirements by providing the notification that directs the individual to promptly change a password and security question or answer, as applicable, or to take other appropriate steps to protect the online account. A knowing and willful violation of these requirements is an unlawful practice and only the Attorney General may enforce the violation by investigation and taking appropriate action. The Attorney General is authorized to impose a civil penalty for violations of the lesser of $10,000 per affected individual or the total amount of economic loss sustained by affected individuals.

• 3/21: Amended in Senate trans-tech; do pass

H2272 (Unmanned Aircraft; Emergencies; Immunity)

Immunity for the state and political subdivisions for a claim based on the exercise or performance or failure to exercise or perform a discretionary function by any emergency worker, except is cases of wilful misconduct, gross negligence or bad faith, is extended to include operating an “unmanned aircraft” or “public unmanned aircraft” (both defined elsewhere in statute) while engaged in or supporting emergency management activities or emergency functions

• 3/20: Senate rules okay; ready for Senate Floor

H2434 (Financial Products; Regulatory Exemption Program)

The Attorney General is required to establish a Regulatory Sandbox Program in consultation with applicable state agencies to enable a person to obtain limited access to the market in Arizona to test “innovative financial products or services” (defined) without obtaining a license or other required authorization. Establishes an application process and requirements for participation in the Program, and requires the Attorney General to collect an application fee in an amount determined by the Attorney General. Once the Attorney General approves an application, the Program participant has 24 months to test the innovative financial product or service, subject to a list of restrictions and regulations depending on the product or service being tested. Establishes requirements for Program participants that include consumer disclosures, recordkeeping, and reporting requirements

• 3/22: Signed by Governor

H2471 (Electronic Wills and Trusts)

Statutes regulating wills are applied to “electronic wills” (defined). A person who is 18 years of age or older and who is of sound mind may make an electronic will, and requirements for electronic wills are specified, including requirements for a “qualified custodian” (defined) of the electronic will. Establishes requirements for “electronic trust instruments” (defined), including to meet statutory requirements for a valid trust.

• 3/22: Amended in Senate Judiciary; do pass

H2528 (Capital Gains; Income Tax Subtraction)

When computing Arizona adjusted gross income for individual income tax purposes, the subtraction from Arizona gross income for an amount of any net long-term capital gain included in federal adjusted gross income derived from an investment in an asset acquired after December 31, 2017 is increased to 30 percent of net long-term capital gain in tax year 2019, 35 percent in tax year 2020, 40 percent in tax year 2021, 45 percent in tax year 2022, and 50 percent in tax year 2023 and after. The subtraction of 20 percent of net long-term capital gain derived from an investment in an asset acquired after December 31, 2011 applies to income derived from an investment acquired after December 31, 2011, and before January 1, 2018.

• 3/21: Senate Finance do pass

H2534 (Teachers; Certification Requirements)

Rewrites and reorganizes statutes establishing requirements for teacher certification. Board of Education rules for teacher certificates are required to include five types of certificates: standard, post-baccalaureate standard, subject-matter expert standard, classroom-based standard, and career and technical education. Exempts the following persons from the requirement to have a baccalaureate degree for teacher certification: a teacher who is otherwise exempt by law from obtaining a baccalaureate degree and who provides instruction in career and technical education, and a person who obtains a native american language certificate, a teaching intern certificate, a junior reserve officer training corps certificate, or an athletic coaching certificate. Directs legislative council to prepare conforming legislation.

• 3/22: Amended in Senate Education; do pass

H2579 (Video Service; Certificate of Authority)

The regulation and use of “video service” (defined as the provision of multichannel video programming, including cable service but excluding internet streaming and direct broadcast satellite service) are of statewide concern and are not subject to further regulation by a county or municipality except as specifically provided in statute. Beginning January 1, 2020, the Secretary of State has the exclusive authority to issue a certificate of authority to a person to provide video service and to construct and operate a video service network in any service area in Arizona. Beginning January 1, 2020, a person is prohibited from acting as a video service provider or constructing or operating a video service network without first having been issued and continuing to hold a certificate of authority. The Secretary of State is required to establish and collect fees for the purpose of administering certificates of authority for video service providers. Beginning January 1, 2020, an incumbent cable operator is permitted to either continue to operate within a service area as defined in the local license or terminate the local license by applying for and obtaining a certificate of authority. Establishes requirements to obtain a certificate of authority, lists the authorities granted by a certificate, and provides for amendment of certificates to add service areas. Much more.

• 3/21: Held in Senate Gov

H2622 (International Trade; Authority; Transportation)

Establishes the International Transportation and Trade Corridor Authority, a corporate and political body with all the rights, powers and immunities of municipal corporations. The Authority is governed by a 9-member Board of Directors, and Board powers and duties are established. By December 31, 2025, the Board is required to approve sites for the construction of a transportation and trade facility proposed at any time before that date by the Board in consultation with jurisdictional sponsors. The Authority is required to construct, finance, furnish, maintain, improve, operate, market and promote the use of transportation and trade facilities and do all things necessary or convenient to accomplish those purposes. Establishes budget and reporting requirements for the Board and financial requirements for the Authority. The Authority is permitted to issue negotiable bonds as authorized by the Board by resolution, and regulations for the bonds and revenues from sale of the bonds are established. The Authority terminates on July 1, 2022. Appropriates $200,000 from the general fund in FY2018-19 to the Authority.

• 3/20: Held in Senate Trans-Tech

HCR2029 (Personal Property Tax Exemption)

The 2018 general election ballot is to carry the question of whether to amend the state Constitution to prohibit taxes from being levied on the first $2 million of full cash value of personal property that is initially acquired during or after 2019 and that is used for agricultural purposes or in trade or business. The Legislature is permitted to provide by law for adjusting the exempt amount according to annual variations in a designated national inflation index.

• 3/21: Senate Finance do pass