Arizona House of Representatives Committee on Commerce Meeting Minutes and Agenda - February 18, 2025

Summary

Minutes and agenda of the regular meeting of the Arizona House of Representatives Committee on Commerce, Fifty-seventh Legislature, First Regular Session, on Tuesday, February 18, 2025, with Representative Weninger as Chairman and Representative Way as Vice-Chairman. The minutes record that the meeting convened at 3:39 P.M. and adjourned at 6:54 P.M., and list the committee action on each bill, among them HB2695 (DPA, 10-0-0-0), HB2865 (DPA, 7-3-0-0) and HB2787 (DP, 6-3-0-1). Agenda items include HB2387 on cryptocurrency kiosk licensing and fraud prevention and HB2654, a blockchain and cryptocurrency study committee. The attachments include the request-to-speak report, the attendance report and roll call votes, and the minutes are signed by Abby Selvey on February 19, 2025.

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ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

COMMITTEE ON COMMERCE

Report of Regular Meeting
Tuesday, February 18, 2025

House Hearing Room 5 -- 2:00 P.M. OR UPON RECESS OR ADJOURNMENT OF FLOOR

Convened 3:39 P.M.
Adjourned 6:54 P.M.

Members Present

Representative Aguilar
Representative Blackman
Representative Cavero
Representative Connolly
Representative Diaz

Representative Hendrix
Representative Villegas
Representative Wilmeth
Representative Way, Vice-Chairman
Representative Weninger, Chairman

Agenda
Original Agenda — Attachment |

Request to Speak
Report — Attachment 2

Committee Attendance
Report — Attachment 3

Committee Action

Members Absent

Bill Action Vote
HB2695 DPA 10-0-0-0
HB2865 DPA 7-3-0-0
HB2866 DPA 9-1-0-0
HB2787 DP 6-3-0-1
HB2387 DPA 9-0-0-1
HB2873 DPA 8-0-0-2
HB2741 DP 8-0-0-2
HB2905 DP 8-0-0-2
HB2906 DP 9-0-0-1
HB2869 DP 6-3-1-0

MINUTES RECEIVED

CHIEF CLERK'S OFFICE

M/19/a5

Attachments
4,5,6
7,8,9
10,11,12
13,14
15,16,17
18,19,20
21,22
23,24
25,26
27,28

COMMITTEE ON COMMERCE
February 18, 2025
HB2328 DPA/SE 6-4-0-0 29,30,31

HB2654 DPA/SE 9-0-0-1 32,33,34,35
HB2342 DPA/SE 5-4-0-1 36,37,38
HB2324 DPA/SE 9-0-0-1 39,40,41

HB2095 HELD
HB2483 HELD
HB2721 HELD

itt, A ters...

Abby Selvey, Committee ecretary
February 19, 2025

(Original attachments on file in the Office of the Chief Clerk; video archives available at http://www.azleg.gov)
Cony? 3234PM
REVISED #3 - 2/17/25 REVISED #3 - 2/17/25 REVISED #3 - 2/17/25

ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

REGULAR MEETING AGENDA

COMMITTEE ON COMMERCE

DATE Tuesday, February 18, 2025 ROOM HHR5 TIME 2:00 P.M. or upon recess or
adjournment of Floor

Members of the public may access a livestream of the meeting here:
https://www.azleg.gov/videoplayer/?clientID=636 1 162879&eventID=2025021091

Members:
Representative Aguilar Representative Diaz Representative Wilmeth
Representative Blackman Representative Hendrix Representative Way, Vice-Chairman
Representative Cavero Representative Villegas Representative Weninger, Chairman
Representative Connolly
Bills Short Title Strike Everything Title
*HB2095 homeowners' associations; declaration amendment; S/E: same subject
vote
(Kupper)
COM, RULES

technical correction; unclaimed property; interest S/E: forfeiture; digital assets; reserve fund

HB2324
D S E (Weninger)

9-0-0-! COM, RULES
HB2328 DPA S Ee technical correction; liquor licenses S/E: fantasy sports contests

(Weninger)
COM, RULES
G “Y “0-0
HB2342 IE cell phone carrier; spam calls S/E: eryptecurrency:
(Martinez) blockchain technology; regulation;

COM, RULES computational power
5-4-0")

HB2387 cryptocurrency kiosk; license; fraud prevention
DPA (Marshall: Way)

9-0-0-| OOM RULES

Page 1 of 3
ATTACHMENT |
Bills Short Title Strike Everything Title

HB2483 H ] | registrar of contractors; licensure
(Hendrix)

COM, RULES

COM RULES
HB2654 blockchain and cryptocurrency study committee  S/E: eryptocurrency and blockchain
DPASIE. (Weninger) commission
q. ] M.
Ste COM, RULES
HB2695 D PA financially vulnerable adult; financial exploitation
(Livingston: Nguyen)
COM, RULES
10-6-0-0
*HB2721 ambulance services; public information S/E: financial disclosure statement; public
(Willoughby) officers

COM held 0-0-0-0-0, RULES

HB2741 D p liquor sampling; reporting; requirements.
——— (Lopez: Biasiucci, Blackman, et al)

g 2 COM, RULES
* aa

HB2787 D ground ambulances; registration
(Willoughby)
6-2-0 -| COM, RULES
HB2865 homeowners' associations; attorney fees
(Carter N) ,

1-3-0- COM, RULES

homeowner's associations; unlawful enforcement;

HB2866
dD Pp, A damages

(Carter N)
Y-l-O°S com, RULES

HB2869 r p municipal development; independent provider

review
(Way: Biasiucci, Carbone, et al)

63-1) GOV w/d, COM, RULES

tourism improvement areas; municipalities;

HB2873
D PA counties

(Wilmeth)

$°0-0-Z com, RULES

Page 2 of 3
Bills Short Title Strike Everything Title

HB2905 D p craft producer; festival; fair; license

(Weninger)
-0-0- COM, RULES
HB2906 D p financial technology; digital assets program
(Weninger)
7q -0-0- ] COM, RULES
Cadena Bede Taped
COM, RULES
* On previous agenda

ORDER OF BILLS TO BE SET BY THE CHAIRMAN

02/17/2025

People with disabilities may request reasonable accommodations such as interpreters, alternative formats, or
assistance with physical accessibility. If you require accommodations, please contact the Chief Clerk's Office at

(602) 926-3032 or through Arizona Relay Service 7-1-1.
Page 3 of 3
Information Registered on the Request to Speak System

House Commerce (2/18/2025)

HB2095, homeowners’ associations; declaration amendment; vote

Neutral:
Tom Farley, Arizona Association Of Realtors

Oppose:

Spencer Kamps, HOME BUILDERS ASSOCIATION OF CENTRAL AZ; Dennis J Legere, ARIZONA HOMEOWNERS
COALITION; Michael Racy, Lobbyist, DIAMOND VENTURES INC; Jason Barraza, Associate Director, ARIZONA
ASSOCIATION OF COMMUNITY MANAGERS (AACM); Priscilla Storm, representing self; Bryan Hawk, representing
self; Christine Keitges, representing self; Paige Livingston, representing self; Kelly Birr, representing self; Fernanda
Quintanilla, representing self; L. Anne Brothers, representing self; Kurt Gronlund, representing self; Catherine
McGurk, representing self; Douglas Kupel, representing self; Lynda Christner, representing self; Linda Ross,
representing self; Roseanne and Steve Elson, representing self; Pierre Desombre, representing self; Joyce
Monsanto, representing self; Rhonda Wakai, representing self; Theresa Kim West, representing self; Denise Priddy,
representing self; Michele Morrison, representing self; Deepak Nayak, representing self; Lopa Nayak, representing
self

All Comments:

Dennis J Legere, ARIZONA HOMEOWNERS COALITION: As drafted, this bill is unacceptable and will allow
associations to violate the property rights of homeowners. An association may not modify the restrictions on their
private property without their consent. An Amendment is pending.; Paige Livingston, Self: Many CC&Rs allow a
51% majority to amend. I'm not sure why you'd want to make is more difficult for homeowners to amend their
CC&Rs. Perhaps, adding “or the lower # if stated in the CC&Rs?"; Kelly Birr, Self: This bill seems well-intentioned
but if it becomes law, WILL be abused by malicious groups (including HOA boards) to change HOA declarations
against the interests of most homeowners by having intentionally poorly announced votes/meetings.; Douglas
Kupel, Self: This bill would enable associations to add or significantly modify restrictions without even a majority of
votes in the community. Please kill this poorly written and deceitful bill. As written, it is unsalvageable.; Linda
Ross, Self: This bill needs to be defeated.

HB2324, technical correction; unclaimed property; interest

HB2328, technical correction; liquor licenses

Testified in support:

Ryan O'Daniel, Prizepicks

Testified as opposed:
Kelsey Lundy, SPORTS BETTING ALLIANCE

ATTACHMENT Z
Oppose:

Theresa Ulmer, COCOPAH INDIAN TRIBE; Meghaen Dell'Artino, GILA RIVER INDIAN COMMUNITY; Jaime Molera, AZ
INDIAN GAMING ASSN; Emily Ryan, Pascua Yaqui Tribe; John MacDonald, HUALAPAI TRIBE; Mike Gardner, SPORTS

BETTING ALLIANCE; Rex Bartlett, Arizona Indian Gaming Association; Tom Farley, COLORADO RIVER INDIAN TRIBES;
Bradley Bledsoe Downes, representing self; Mike Bielecki, Navajo Nation Council

All Comments:

Theresa Ulmer, COCOPAH INDIAN TRIBE: Opposed to proposed Striker Amendment.; Meghaen Dell'Artino, GILA
RIVER INDIAN COMMUNITY: this amendment will likely trigger the poison pill which will have adverse financial
consequences for the State; Jaime Molera, AZ INDIAN GAMING ASSN: Oppose the strike everything amendment.;
John MacDonald, HUALAPAI TRIBE: Opposed to strike-everything amendment to 2328.; Mike Bielecki, Navajo
Nation Council: The Strike All amendment conflicts with the AZ gaming compacts with tribes, would violate the
compact and trigger the poison pill. This was a Compact that was negotiated for over 3 years with Governor Ducey.

HB2342, cell phone carrier; spam calls

Oppose:

Sandy Bahr, Sierra Club - Grand Canyon Chapter; Thomas Krepitch, representing self; Rebecca Smith Gross,
representing self; Craig McDermott, representing self; Beverly Janowitz-Price, representing self; Alisa McMahon,
representing self; Michael Fiflis, representing self; Dianne Post, representing self; Darrell Boomgaarden,
representing self; Charlie Silver, representing self; Jenna Lillibridge, representing self; Marilyn Schwind,
representing self; Maggie Huntington, representing self; Kathryn Pensinger, representing self; Nancy Santori,
representing self; Sherry Massie, representing self; Barbara Swenson, representing self; Barbara Hollway,
representing self; Chris Allen, representing self; Samantha Meier, representing self; David Myers, representing self;
Monica Bills, representing self; Marilyn Murov, representing self; Nancee K Wood, representing self; Kathryn Dorn,
representing self; Valarie Bryant, representing self; Jessica Bueno, representing self

All Comments:

Sandy Bahr, Sierra Club - Grand Canyon Chapter: These use a lot of resources and need more, not less regulation.;
Alisa McMahon, Self: S/E: Who would regulate? When the legislature usurps local authority, it often saddles
localities with problems they have no power to fix. It seems the most likely problems here would be power and
internet capacity. Some cities in AZ provide power.; Michael Fiflis, Self: S/E: Special interest legislation for the rich
and powerful, preempting local authority to regulate and leaving local problems without a fix.; Chris Allen, Self:
Why are you trying to make it easier to use black market currency? The cartels have wrecked havoc on our
communities, making their payments easier is going to make things worse.; Marilyn Murov, Self: this striker would
cut needed safeguards to crypto; Kathryn Dorn, Self: | oppose the strike-everything amendment which would make
it more difficult to regulate cryptocurrency and, therefore, prevent the state from limiting crypto's deliberate
waste of energy! We need our electricity for lifesaving AC, not fake money!

HB2387, cryptocurrency kiosk; license; fraud prevention

Testified in support:
Marie Isaacson, Coinflip; Brendon Blake, AARP; Joe Clure, Arizona Police Association; Thomas Intrieri,
representing self
Support:

Megan Kintner, AZ ASSOCIATION OF COUNTIES; Jack W Lunsford, AARP Arizona; Brett Mecum, representing self;
Harold Bergsma, representing self; Eileen Kendig, representing self; Nick Debus, AZ ATTORNEY GENERAL'S OFFICE;
Don Isaacson, Coinflip; Tom Doescher , representing self

Oppose:

Thomas Krepitch, representing self; Craig McDermott, representing self; Beverly Janowitz-Price, representing self;
Dianne Post, representing self; Bettina Bickel, representing self; Jenna Lillibridge, representing self; Kathryn
Pensinger, representing self; Kathleen Dubbs, representing self; Nancy Santori, representing self; Barbara Hollway,
representing self; David Myers, representing self; Monica Bills, representing self; Nancee K Wood, representing
self; Valarie Bryant, representing self; Jessica Bueno, representing self

All Comments:
Brendon Blake, AARP: AARP believes strongly in providing protections for Arizonans against scammers; Don
Isaacson, Coinflip: Will speak, if necessary

HB2483, registrar of contractors; licensure

Support:
Araceli Lopez, AZ REGISTRAR OF CONTRACTORS

All Comments:
Araceli Lopez, AZ REGISTRAR OF CONTRACTORS: Further explanation of bill

HB2654, blockchain and cryptocurrency study committee

Support:

Dianne McCallister, Arizona Technology Council; Brett Mecum, representing self

HB2695, financially vulnerable adult; financial exploitation

Support:

James Fitzpatrick, representing self

Neutral:
Kathy Ber, DES Director of Legislative Services, Arizona Department Of Economic Security
HB2721, ambulance services; public information

HB2741, liquor sampling; reporting; requirements.

Testified in support:
Michelle Ahlmer, ARIZONA RETAILERS ASSOCIATION

Testified as neutral:
Steve Barclay, BEER & WINE DISTRIBUTORS OF ARIZONA

Support:

Trish Hart, Arizona Food Marketing Alliance

HB2787, ground ambulances; registration

Support:
Stan Barnes, PRIORITY AMBULANCE, LLC; John Flynn, Arizona Fire District Association

All Comments:
Stan Barnes, PRIORITY AMBULANCE, LLC: | wish to speak to the bill in committee

HB2865, homeowners' associations; attorney fees

Testified in support:
Dennis J Legere, ARIZONA HOMEOWNERS COALITION

Testified as neutral:
Tom Farley, Arizona Association Of Realtors

Testified as opposed:
Spencer Kamps, HOME BUILDERS ASSOCIATION OF CENTRAL AZ; Lynelle Glysson, representing self; Kathryn
Battock, representing self

Support:

Paul Gaulocher, representing self; Kurt Gronlund, representing self; Bryan Hawk, representing self; Catherine
McGurk, representing self; Douglas Kupel, representing self; Linda Ross, representing self; Roseanne and Steve
Elson, representing self; Pierre Desombre, representing self; Teresa Pinter, representing self; Rhonda Wakai,
representing self; Theresa Kim West, representing self; Denise Priddy, representing self; Michele Morrison,
representing self; Deepak Nayak, representing self; Lopa Nayak, representing self
Oppose:

Alexis Glascock, COMMUNITY ASSOCIATIONS INSTITUTE; Jason Barraza, Associate Director, ARIZONA ASSOCIATION
OF COMMUNITY MANAGERS (AACM); Brian Lincks, representing self; L. Anne Brothers, representing self; Lysa
Agan-Nabours, representing self; Lynda Christner, representing self; Joyce Monsanto, representing self

All Comments:

Dennis J Legere, ARIZONA HOMEOWNERS COALITION: While the approach of this bill is unconventional, it is
appropriate because only the homeowners can hold the associations accountable to the law thru litigation. No
other method is available as is there any oversight organization over the behaviors.; Paul Gaulocher, Self: | am for
this Bill; Douglas Kupel, Self: | support the negotiated language changes that will be supplied as an amendment
prior to this bill being heard in committee that will allow the homeowner to be awarded attorney fees if they
prevail but not the association.; Kathryn Battock, Self: This bill would be an unconstitutional tax on law abiding
homeowners.; Brian Lincks, Self: This is very poor and unnecessary legislation, this goes against basic law, this will
breed more lawsuits and is totally unnecessary. It’s going to make it difficult for the average community manager
to navigate this legislation, vote no !; Lysa Agan-Nabours, Self: HOA's need to be able to hold homeowners in a
group, accountable; Tom Farley, Arizona Association Of Realtors: Neutral with the adoption of the amendment.

HB2866, homeowner's associations; unlawful enforcement; damages

Testified in support:
Dennis J Legere, ARIZONA HOMEOWNERS COALITION

Testified as opposed:
Spencer Kamps, HOME BUILDERS ASSOCIATION OF CENTRAL AZ; Lynelle Glysson, representing self

Support:

Onita Davis, representing self; Shirley Dye, representing self; Rose Sperry, representing self; Mike Sullivan,
representing self; Bill Blewster, representing self; Mark Logan, representing self; Cindy Sullivan, representing self;
Theresa Logan, representing self; Greg Kistler, representing self; Stephen Harris, representing self; Buffalo Rick
Galeener, representing self; Susan Bolt, representing self; Melanie Hutchings, representing self; Phyllis Lester,
representing self; Susan Kelly, representing self; Helen Hebert, representing self; Starr Costa, representing self;
Donna Booth, representing self; Pam Throw, representing self; Gary Zimmerman, representing self; Dayle
Hartgerink, representing self; Barbara Blewster, representing self; Paul Gaulocher, representing self; Kurt Gronlund,
representing self; Bryan Hawk, representing self; Catherine McGurk, representing self; Douglas Kupel, representing
self; Linda Ross, representing self; Roseanne and Steve Elson, representing self; Pierre Desombre, representing
self; Teresa Pinter, representing self; Rhonda Wakai, representing self; Theresa Kim West, representing self; Denise
Priddy, representing self; Michele Morrison, representing self; Deepak Nayak, representing self; Lopa Nayak,
representing self

Neutral:
Craig McDermott, representing self
Oppose:

Lysa Agan-Nabours, representing self; Jason Barraza, Associate Director, ARIZONA ASSOCIATION OF COMMUNITY
MANAGERS (AACM); Alexis Glascock, COMMUNITY ASSOCIATIONS INSTITUTE; Lynda Christner, representing self;
Joyce Monsanto, representing self

All Comments:

Dennis J Legere, ARIZONA HOMEOWNERS COALITION: We support the concept of this bill with modifications to the
penalty amounts. Non-compliance with the law must have consequences, or the behaviors will never change.;
Shirley Dye, Self: Heavy handed homeowners associations have caused many problems by being overly heavy
handed and my way or the highway, even if state legislation says it is OK to like have chickens, or the color of paint
for your house.; Bill Blewster, Self: Associations have to be required and enforced to obey the laws governing their
activities & rules.; Stephen Harris, Self: HOA Boards sometimes overstep the law!; Helen Hebert, Self: Associations
need to follow the laws; Gary Zimmerman, Self: I've heard too many horror stories of HOAs going amuck and
dictatorial, and even passing frankly unconstitutional "rules" on their members. Hopefully this can control these
HOAs.; Dayle Hartgerink, Self: LD28 PC; Barbara Blewster, Self: We have seen homeowners associations be way out
of control. It is helpful if citizens remember to be good neighbors; Paul Gaulocher, Self: | am for this Bill; Douglas
Kupel, Self: | support this legislation if the damages awarded are reduced to reasonable amounts of less than
§5,000.; Lysa Agan-Nabours, Self: HOA's need to have a way to enforce CCR's and recover fines.; Craig McDermott,
Self: Inadvertently entered a position on this one

HB2869, municipal development; independent provider review

Support:

Tim Rosenberger, representing self; Elizabeth King, representing self; William & Mary Jurica, representing self;
Charles Mackey, representing self; robert Hobbs Sr., representing self; Charmaine Roth, representing self; Susie
Luhrs, representing self; Dianna Gates, representing self; Greg Blackie, AZ FREE ENTERPRISE CLUB; Carole Challoner,
representing self; LouAnn Sedgwick, representing self; Vickie Parks, representing self; Cherie Anello, representing
self; Peter Anello, representing self; Lynne M Alcaraz, representing self; Mary Evelyn Simpson, representing self;
Steve Hetsler, representing self; Peter Asencio, representing self; Thomas Simacek, representing self; Jean Rice,
representing self; karen enns, representing self; Mary Jamsa, representing self; deana corsa, representing self;
Travis Chow, representing self; Vicki Roller-Chow, representing self; Roy Scott Lassell, representing self; Cornel
Choskey, representing self; Kathryn Clark, representing self; Donalda Bond, representing self; Lydia Choskey,
representing self; Lynda Patrick-Hayes, representing self; Anne Rankin, representing self; Jane Evans, representing
self; Cheryl Pardini, representing self; Robin Davis, representing self; Laurel Lynn Scott, representing self; Ronald
Pardini, representing self; Karen Hobbs, representing self

Oppose:

Marshall Pimentel, LEAGUE OF ARIZONA CITIES & TOWNS; Robyn Prud'homme-Bauer, representing self; Tom Dorn,
Arizona Planning Association; Amber Wakeman, EL MIRAGE, CITY OF; Rob Bohr, GILBERT, TOWN OF; Miranda
DeWitt, MESA, CITY OF; Peggy J McMahon, representing self; Randy Brown, representing self; Teri Grunewald,
representing self; Garrett Bowers, representing self; Dale Wiebusch, "SCOTTSDALE, CITY OF "; Eric Goettl,
representing self; Robert Wisler , APACHE JUNCTION, CITY OF; Ilse Contreras, PHOENIX, CITY OF; Wendy Radimer,
representing self; Paul Johnson, representing self; Damian Dorame, BUCKEYE, TOWN OF
All Comments:

Charles Mackey, Self: Allowing a builder to use an independent provider to review permits and do inspections
would speed up the home building immensely. Cities, towns, counties are extremely slow in reviewing permits and
doing inspections. Vote YES; Susie Luhrs, Self: Let's make things easier for permitting.; Vickie Parks, Self: This is a
good idea; Mary Evelyn Simpson, Self: YavGOP PC. Support speeding development act. Reduce the housing
shortage caused bby over regulation.; Peter Asencio, Self: | am a PC Captain, AZ State Committeeman. We hava
affordable housing shortage that needs to be delt with.; Mary Jamsa, Self: The use of an independent reviewer will
move things along in a quicker time frame. | support this bill.; Roy Scott Lassell, Self: | fully support this bill. It
makes sense and is appropriate.; Kathryn Clark, Self: Having independent reviewers for the permit process will
result in a bigger supply and lower cost of permits. This will result in a bigger supply of homes. This would be great
- please vote YES.; Donalda Bond, Self: | support allowing private inspections etc as long as they are state
qualified.; Peggy J McMahon, Self: BAD BILL, same as the one last year. 3rd party plan review is so unnecessary and
fraught with issues. DON'T VOTE FOR THIS BILL.; Randy Brown, Self: This would swing the door WIDE OPEN to
corruption. We don't need the fox guarding the hen house.; Teri Grunewald, Self: ALLOWS CONTRACT & PYMNT
DIRECTLY TO INDEPENDENT PROVIDER.; Garrett Bowers, Self: Precinct & State Committeeman and 2nd Vice Chair,
YavGOP; Wendy Radimer, Self: AGAINST this bill. Wendy Radimer, a Precinct and State Committeeman; Paul
Johnson, Self: | am against this Bill. | am Arnold Paul Johnson who is a Precinct Committeeman i

HB2873, tourism improvement areas; municipalities; counties

Testified in support:
Marcus Carney, representing self; Ron Price, representing self; Laura Magnus, EXPERIENCE SCOTTSDALE, VISIT

MESA

Testified as neutral:
Jim Rounds, representing self

Testified as opposed:
Kevin McCarthy, ARIZONA TAX RESEARCH ASSOCIATION (ATRA); Bill Blewster, representing self; Greg Blackie, AZ
FREE ENTERPRISE CLUB

Support:

Michael Racy, Lobbyist, PIMA COUNTY; James Hamilton, PHOENIX RACEWAY; Todd Baughman, ARIZONA LODGING
AND TOURISM ASSOCIATION; John MacDonald, VISIT PHOENIX; Steve Barclay, BEER & WINE DISTRIBUTORS OF
ARIZONA; Julie Rees, TUCSON AIRPORT AUTHORITY; Greg Kistler, representing self; Marc Garcia, representing self;
Alexis Susdorf, PRESCOTT, CITY OF; Clark Princell, VALLEY PARTNERSHIP; Ronald Pardini, representing self; Steve
Kaiser, VISIT MESA; Barbara Blewster, representing self; Dennis Kavanaugh, representing self

Oppose:

Joe Galli, Flagstaff Chamber of Commerce, Greater Flagstaff Chamber Of Commerce; Onita Davis, representing self;
Ed Davis, representing self; Rose Sperry, representing self; Cathy Schwanke, representing self; Mike Sullivan,
representing self; James Dutton , representing self; Mark Logan, representing self; Warren Woodward,
representing self; Cindy Sullivan, representing self; Theresa Logan, representing self; Leslie White, representing
self; Buffalo Rick Galeener, representing self; Susan Bolt, representing self; William & Mary Jurica, representing
self; Charles Mackey, representing self; Charmaine Roth, representing self; Susie Luhrs, representing self; Dianna
Gates, representing self; Carole Challoner, representing self; Randy Brown, representing self; Sydney Brown,
representing self; Melanie Hutchings, representing self; LouAnn Sedgwick, representing self; Teri Grunewald,
representing self; Phyllis Lester, representing self; Vickie Parks, representing self; Cherie Anello, representing self;
Peter Anello, representing self; Lynne M Alcaraz, representing self; Helen Hebert, representing self; Starr Costa,
representing self; Carol Kliewer, representing self; Mary Evelyn Simpson, representing self; Janet Klepacz,
representing self; Steve Hetsler, representing self; Peter Asencio, representing self; Thomas Simacek, representing
self; Garrett Bowers, representing self; Jean Rice, representing self; karen enns, representing self; Jeffrey Luft,
representing self; Mary Jamsa, representing self; deana corsa, representing self; John Matthews, representing self;
Travis Chow, representing self; Vicki Roller-Chow, representing self; Roy Scott Lassell, representing self; Michael
Mote, representing self; Pam Throw, representing self; Sandee McKinlay, representing self; Cornel Choskey,
representing self; Kathryn Clark, representing self; Gary Zimmerman, representing self; Donalda Bond,
representing self; Lydia Choskey, representing self; Anne Rankin, representing self; Wendy Radimer, representing
self; Paul Johnson, representing self; Jane Evans, representing self; Robin Davis, representing self; Laurel Lynn Scott,
representing self; Bill Harenburg, representing self

All Comments:

John MacDonald, VISIT PHOENIX: Support bill and Weninger amendment.; James Dutton, Self: Kill it before the
infection spreads.; Leslie White, Self: Big GOVT BILL. Vote NO! PC in LDS.; Charles Mackey, Self: This bill would
allow a government entity to allow hotels to form an tourism improvement district. This hotel association would
charge and collect fees from hotels in the area. This would force some hotels to unnecessarily comply. Vote NO.;
Randy Brown, Self: Business bullying! Just like a Union. Don't want to participate? Too bad! Tyranny of the
majority! AZ is a Right to Work state, why can't we be a Right to Run your Business state? Lodging businesses can
do this by VOLUNTARY association if they want.; Sydney Brown, Self: Participation in funding tourism projects
should be VOLUNTARY.; Teri Grunewald, Self: Only allows for some businesses to be given benefits.; Phyllis Lester,
Self: Businesses should do this without the involvement of government; Vickie Parks, Self: Cannot force, for
example, other hotels to participate; Helen Hebert, Self: Would be a lot cheaper if government is kept out of it.;
Mary Evelyn Simpson, Self: YavGOP PC Long convuluted bill that shuld not behandled by the legislature.
Busineses would be better served by a local business coalition for business development.; Janet Klepacz, Self: NO!
Allows a municipality or county to approve the formation of a tourism improvement area upon a petition signed by
the lodging business owners who represent at least 67% of the total lodging business rooms available within the
proposed area.....; Peter Asencio, Self: | am a PC Captain, AZ State Committeeman. Rules should be fair to everyone,
not a select few.; Garrett Bowers, Self: Precinct & State Committeeman and 2nd Vice Chair, YavGOP LETS TREAT
ALL BUSINESSES FAIR! "Tourism Districts" giving benefits to one zone and not another is UNFAIR.; karen enns, Self:
Hotels should not be able to force other hotels to pay unnecessary taxes. .; Jeffrey Luft, Self: This would create an
unfair burden on businesses; Mary Jamsa, Self: This bill will add additional taxes to hotels that will have to recoup
these additional taxes from their guests. | am against this bill.; John Matthews, Self: If businesses involved in
tourism want this done, they should do it without government involvement.; Roy Scott Lassell, Self: | do not
support this bill. This does not support appropriate taxation.; Kathryn Clark, Self: Participation in funding tourism
projects should be voluntary, not compelled by a supermajority voted tax on hotels. Please vote NO.; Gary
Zimmerman, Self: Tourist businesses/CoCs can form their own tourism improvement organizations. The
government need not be involved nor should government monies be used for the benefits of a few businesses.;
Donalda Bond, Self: |'m against forced taxing tourism should get a coalition; Wendy Radimer, Self: AGAINST with
this bill. Wendy Radimer, a Precinct and State Committeeman; Paul Johnson, Self: | am AGAINST this bill and | am
Arnold Paul Johnson who is a Precinct Committeeman; Bill Harenburg, Self: It doesn't make sense to force a
company to spend money based on other's opinions.; Jim Rounds, Self: | am conducting the ROI analysis of the bill.
HB2905, craft producer; festival: fair; license

Testified in support:
Rob Fullmer, ARIZONA CRAFT BREWERS GUILD; Dr Garrison Ellam, ARIZONA CRAFT PRODUCERS ASSN

Support:
Steve Barclay, BEER & WINE DISTRIBUTORS OF ARIZONA; Don Isaacson, Arizona Licensed Beverage Association;
Marie Isaacson, AZ LICENSED BEVERAGE ASSN

All Comments:
Rob Fullmer, ARIZONA CRAFT BREWERS GUILD: This is a vital and timely bill that will provide regulatory relief to
smaller rural breweries and also unify language and strengthen festival licensing.

HB2906, financial technology; digital assets program

Support:

Dianne McCallister, Arizona Technology Council; Brett Mecum, representing self
COMPLETE FORM FOR PUBLIC RECORD

STATE OF ARIZONA
HOUSE OF REPRESENTATIVES

REQUEST TO SPEAK

7
Cage. ; > ~ aed) 22
Committee on Date: © [ 3/7S_ Bill Number: _© oS a-J 2806
Name: _—~/ OhW Ltn: “in A. | Usupport QO) Oppose O Neutral | Need to Speak: E.-Yes QO) No
Representing: Registered Lobbyist UO Yes FNo

address: J033 Perth fre city/state: Ghar wire Vall¢hp Code:_ 29/YVP
Email Address:_ 1-1 Chau, ptr — ZO ys dem Phone Number:

Comments:

*SPEAKING TIME DETERMINED BY THE CHAIRMAN*
COMPLETE FORM FOR PUBLIC RECORD

STATE OF ARIZONA
HOUSE OF REPRESENTATIVES

Coarrmryneteee. reRUEST Tas / 7% 6 ANA2865
Committee on halal idanaia Date: _2// y 2S” Bill Number: => ws
Name: Lsail Li hbtt {a Support cA Oppose U) Neutral | Need to Speak; Yes UO No

Representing: yi 2 Registered Lobbyist UO) Yes WNo
Address: F245 4 = Wat2he prem hn Lieli Cth i Code: SO /¥, 2

Email Address: 34/00 71/2. ‘7 Lroauifoglly Shone Number: SW) ~ Z 7¥.-DIOE
COM

Comments:

*SPEAKING TIME DETERMINED BY THE CHAIRMAN*
COMPLETE FORM FOR PUBLIC RECORD

STATE OF ARIZONA
HOUSE OF REPRESENTATIVES

REQUEST TO SPEA - eee
Committee an (enneamaun. Date: 2 13 25 Bill Number: __2 80S a
Name: (i UL GC hyloche Zz | (A support Seco QO Neutral | Need to Speak: QYesO No
Representing: Le fe Registered Lobbyist O Yes (No

address:_ 7 A] U 7 GH Chef City/State: Scet/ShA/ Crip Code: Gb 2S
Email Address: file Veyrungs (LU erone Number: LIGO-2¢Y - CS IL
Comments: in_ppaucr 4 WA IIA

*SPEAKING TIME DETERMINED BY THE CHAIRMAN*
He iS signed 1a bul

VCOY led Or <dy Ws |
) A ‘9 li p J COMPLETE FORM FOR PUBLIC RECORD

STATE OF ARIZONA
HOUSE OF REPRESENTATIVES
REQUEST TO SPEAK
Committeeon__ Cory NEA CE Date: rele &— Bill Number: ZIT
Name: Tes MAS Tater l | sa’support Q opnaee Q Neutral | Need to Speak: GYes O No

Representing: Cit] ee FE ore (A Fa ucEe De. Registered Lobbyist QO) Yes EFNo
Address: S¥?/ W, WWW hoe F 2 City/State: been) A] Zip Code: fire YS~
Email Address: THOM } : DIThEAY & eon nt #vPhone Number: 6 ix. 24 2" ‘Ag f

Comments:

*SPEAKING TIME DETERMINED BY THE CHAIRMAN*
PLEASE sical THIS FORM FOR THE PUBLIC RECORD

HOUSE OF REPRESENTATIVES

Please PRINT Clearly

Committee on ri 6aln —ClL- Bill Number Z. is oa

Date "- #5 Sa él ie oe a JASupport Oppose O Neutral

Name “Vo A Tr r Ke Need to Speak? ZhYes UNo
Representing ( Ey E b Q) Are you a registered lobbyist? fo.

Complete Address Y iF & Va Bon Ae Fore Joy $c
E-mail Address 5 2 V\A@ cont higedteed Phone Number ae = We FF Az

Comments:

*** RT VE-MINUTE SPEAKING LIMIT***
ARIZONA STATE LEGISLATURE

Fifty-seventh Legislature - First Regular Session

COMMITTEE ATTENDANCE RECORD

COMMITTEE ON

COMMERCE

CHAIRMAN: Jeff Weninger VICE-CHAIRMAN: _ Michael Way
DATE 01/14/25] 1/28/25} 2 /zf 125 2/il /25\2 | 1% 125
CONVENED 2-071PM12705PM| Bog PM/3503 P3229 PM
RECESSED
RECONVENED
ADJOURNED S:lopm| 4: J0pm| C:26pml4H1 oul:
MEMBERS
Aguilar / i i 7 7 aS
Blackman a va ” 4 yi af
Cavero A we Vans uF.
Connolly rl rl a f/ 7
Diaz wi rs J
Hendrix a A ee WA a ;
Villegas we | ag | of | nl
Wilmeth - “i al ia” | wt
Way, Vice-Chairman a a 4 oe ri
Weninger, Chairman Y "A iw | wt
v Present Absent exc Excused

ATTACHMENT S

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2695: financially vulnerable adult; financial exploitation
Sponsor: Representative Livingston, LD 28
Committee on Commerce

Overview
Authorizes a financial institution to communicate with persons on a trusted contact list that

a financially vulnerable adult is believed to be a victim or target of exploitation.

History
Adult Protective Services (APS) is a program within the DES Division of Aging and Adult

Services and is responsible for investigating allegations of abuse, exploitation and neglect of
vulnerable adults. The duties and responsibilities of APS workers include: 1) receiving
reports of abused, exploited or neglected vulnerable adults; 2) receiving oral or written
information indicating that an adult may be in need of protective services; 3) conducting
evaluations to determine if an adult is in need of protective services and which services are
needed; 4) offering protective services to individuals in need; and 5) filing petitions for
guardianship or conservatorship of vulnerable adults (A.R.S. § 46-452),

A vulnerable adult is an individual who is 18 years of age or older and who is unable to protect
himself from abuse, neglect or exploitation by others because of a physical or mental
impairment. Vulnerable adult includes an incapacitated person (A.R.S. § 46-451).

Provisions
1. Allows a financial institution to offer the opportunity to submit and update a trusted
contact list to financially vulnerable adults. (Sec. 1)

2. Instructs a financial institution to conduct the same level of reasonable due diligence on
any trusted person that it conducts for their customers. (Sec. 1)

3. Stipulates the financial institution must communicate with specified individuals if the
institution has reasonable suspicion that a financially vulnerable adult is a victim or
target of exploitation. (Sec. 1)

4. Exempts the information that is shared from any customer consent or customer notice
requirements. (Sec. 1)

5. Prescribes the training that must be provided by the financial institution. (Sec. 1)

Requires that a financial institution that provides exploitation training to:

a) retain copies of training materials;

b) maintain a list of trained employees with dates of training; and

c) provide training materials to the Department of Insurance and Financial Institutions
or any other governmental entity on request. (Sec 1)

OO Prop 105 (45 votes) OD Prop 108 (40 votes) 0 Emergency (40 votes) O Fiscal Note

HB 2695
Initials Page 1 Commerce

ATTAGHMENT 4
7. Stipulates the financial institution must report the behavior to adult protective services,
law enforcement or other governmental entity if there is reasonable suspicion to believe
that the financially vulnerable adult is being or may have been exploited. (Sec. 1)

8. Adds the financial institution must cooperate in any investigation and disclose financial
records and information relevant to an investigation. (Sec. 1)

9. Provides immunity from any civil or administrative liability for actions taken or omission
made in good faith to financial institutions that provided training to their employees.
(Sec. 1)

10. Defines financial institution, financially vulnerable adult and trusted contact list. (Sec. 1)

HB 2695
Initials Page 2 Commerce
Fifty-seventh Legislature Commerce
First Regular Session H.B. 2695

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2695
(Reference to printed bill)

Amendment instruction key:

(GREEN UNDERLINING IN BRACKETS] indicates text added to statute or

previously enacted session law.

(Green underlining in brackets] indicates text added to new session law

or text restoring existing law.

[GREEN-STRIKRECUTF-HE-BRACKETS] indicates new text removed from statute

or previously enacted session law.

[Green—strtkeout—nrbrackets] indicates text removed from existing statute,
previously enacted session law or new session law.

<<Green carets>> indicate a section added to the bill.
<<freen—strtkeout—ir-carets>> indicates a section removed from the bill.

The bill as proposed to be amended is reprinted as follows:
.<<Sec. 1. Section 46-454, Arizona Revised Statutes, is amended to
read:

46-454. Duty to report abuse, neglect and exploitation of
vulnerable adults; duty to make medical records
available; violation: classification

A. A health professional, emergency medical technician, home health

provider, hospital intern or resident, speech, physical or occupational
9 therapist, long-term care provider, social worker, peace officer, medical
10 examiner, guardian, conservator, fire protection personnel, developmental
11 disabilities provider, employee of the department of economic security or
12 other person who has responsibility for the care of a vulnerable adult and
13 who has a reasonable basis to believe that abuse, neglect or exploitation
14 of the vulnerable adult has occurred shall immediately report or cause
15 reports to be made of such reasonable basis to a peace officer or to the
16 adult protective services. central intake unit. The guardian’ or
17 conservator of a vulnerable adult shall immediately report or cause
18 reports to be made of such reasonable basis to the superior court and the
19 adult protective services central intake unit. The reports required by
20 this subsection shall be made immediately by telephone or online.

21 B. If an individual listed in subsection A of this section is an
22 employee or agent of a health care institution as defined in section
23 36-401 and the health care institution's procedures require that all
24 suspected abuse, neglect and exploitation be reported to adult protective
25 services as required by law, the individual is deemed to have complied
26 with the requirements of subsection A of this section by reporting or
27 causing a report to be made to the health care institution in accordance
28 with the health care institution's procedures.

ONODTOHP WDM FP

Aqoptet

ATTACHMENT S
House Amendments to H.B. 2695

ANA OHPWMHE

C. An attorney, accountant, trustee, guardian, conservator[,
BANKING OR FINANCIAL PROFESSIONAL) or other person who has responsibility

for preparing the tax records of a vulnerable adult or a person who has
responsibility for any other action concerning the use or preservation of
the vulnerable adult's property and who, in the course of fulfilling that
responsibility, discovers a reasonable basis to believe that abuse,
neglect or exploitation of the vulnerable adult has occurred shall
immediately report or cause reports to be made of such reasonable basis to
a peace officer or to the adult protective services central intake
unit. The reports required by this subsection shall be made immediately
by telephone or online.

D. Reports pursuant to subsections A and C of this section shall
contain:

1. The names and addresses of the vulnerable adult and any persons
having control or custody of the vulnerable adult, if known.

2. The vulnerable adult's age and the nature and extent of the
vulnerable adult's vulnerability.

3. The nature and extent of the abuse, neglect or exploitation.

4. <Any other information that the person reporting believes might
be helpful in establishing the cause of the abuse, neglect or
exploitation.

E. Any person other than one required to report or cause reports to
be made pursuant to subsection A or C of this section who has a reasonable
basis to believe that abuse, neglect or exploitation of a vulnerable adult
has occurred may report the information to a peace officer or to the adult
protective services central intake unit.

F. A person having custody or control of medical or financial
records of a vulnerable adult for whom a report is required or authorized
under this section shall make those records, or a copy of those records,
available to a peace officer or adult protective services worker
investigating the vulnerable adult's abuse, neglect or exploitation on
written request for the records signed by the peace officer or adult
protective services worker. Records disclosed pursuant to this subsection
are confidential and may be used only in a judicial or administrative
proceeding or investigation resulting from a report required or authorized
under this section.

G. If reports pursuant to this section are received by a peace
officer, the peace officer shall notify the adult protective services
central intake unit as soon as possible and make that information
available to them, including all related police records. A peace officer
shall provide the information to adult protective services as soon as
possible.

H. A person required to receive reports pursuant to subsection A, C
or E of this section may take or cause to be taken photographs of the
abused vulnerable adult and the vicinity involved. Medical examinations,
including radiological examinations of the involved vulnerable adult, may
be performed. Accounts, inventories or audits of the exploited vulnerable
House Amendments to H.B. 2695

ONO OHP WM FE

adult's property may be performed. The person, department, agency or
court that initiates the photographs, examinations, accounts, inventories
or audits shall pay the associated costs in accordance with existing
statutes and rules. If any person is found to be responsible for the
abuse, neglect or exploitation of a vulnerable adult in a criminal or
civil action, the court may order the person to make restitution as the
court deems appropriate.

I. If psychiatric records are requested pursuant to subsection F of
this section, the custodian of the records shall notify the attending
psychiatrist, who may excise from the records, before they are made
available:

1. Personal information about individuals other than the patient.

2. Information regarding specific diagnosis or treatment of a
psychiatric condition, if the attending psychiatrist certifies in writing
that release of the information would be detrimental to the patient's
health or treatment.

J. If any portion of a psychiatric record is excised pursuant to
subsection I of this section, a court, on application of a peace officer
or adult protective services worker, may order that the entire record or
any portion of the record containing information relevant to the reported
abuse, neglect or exploitation be made available to the peace officer or
adult protective services worker investigating the abuse, neglect or
exploitation.

K. A licensing agency shall not find that a reported incidence of
abuse at a care facility by itself is sufficient grounds to allow the
agency to close the facility or to find that all residents are in imminent
danger.

L. Retaliation against a person who in good faith reports abuse,
neglect or exploitation is prohibited. Retaliation against a vulnerable
adult who is the subject of a report is prohibited. Any adverse action
taken against a person who reports abuse, neglect or exploitation or a
vulnerable adult who is the subject of the report within ninety days after
the report is filed is presumed to be retaliation.

M. A person who violates this section is guilty of a class 1
misdemeanor, except that if the failure to report involves an offense
listed in title 13, chapter 14, the person is guilty of a class 6
felony.>>

Sec. 2. Title 46, chapter 4, article 1, Arizona Revised Statutes,
is amended by adding section 46-456.01, to read:

46-456.01. Financial institutions; financially vulnerable
adults; trusted contact Lass training:
immunity; definitions

A. A FINANCIAL INSTITUTION MAY OFFER TO A FINANCIALLY VULNERABLE
ADULT THE OPPORTUNITY TO SUBMIT AND UPDATE A TRUSTED CONTACT LIST. A
FINANCIAL INSTITUTION SHALL CONDUCT THE SAME LEVEL OF REASONABLE DUE
DILIGENCE ON ANY TRUSTED PERSON THAT THE FINANCIAL INSTITUTION CONDUCTS
FOR THE FINANCIAL INSTITUTION'S CUSTOMERS.

House Amendments to H.B. 2695

h
SMO ON ADO HPWNME

PHF HPFPPPWWWWWWWWWWNYDNDNDNDDNDANDDAN NRF RP PRP RP RPP Pe
SDAP WNERFDWOANATAHPWNHRF TOWANDA TAHBRWNHMHPRFP OW AND OHPWNHE

B. A FINANCIAL INSTITUTION THAT HAS REASONABLE CAUSE TO SUSPECT
THAT A FINANCIALLY VULNERABLE ADULT IS A VICTIM OR TARGET OF EXPLOITATION
SHALL COMMUNICATE WITH ANY OR ALL OF THE FOLLOWING [UNLESS THAT INDIVIDUAL
IS SUSPECTED AS THE POSSIBLE PERPETRATOR OF THE ALLEGED EXPLOITATION]:

1. ANY PERSON ON THE TRUSTED CONTACT LIST.

2. A CO-OWNER, ADDITIONAL AUTHORIZED SIGNATORY OR BENEFICIARY ON
ANY ACCOUNT THAT IS HELD BY A FINANCIALLY VULNERABLE ADULT.

3. ANY INDIVIDUAL WHO IS REASONABLY ASSOCIATED WITH THE FINANCIALLY
VULNERABLE ADULT, INCLUDING A FAMILY MEMBER, IF THE FINANCIALLY VULNERABLE
ADULT:

(a) DID NOT PROVIDE A TRUSTED CONTACT LIST OR THE FINANCIAL
INSTITUTION WAS UNABLE TO COMMUNICATE WITH THE INDIVIDUALS ON THE TRUSTED
CONTACT LIST.

(b) DOES NOT HAVE A POWER OF ATTORNEY.

[4. A FINANCIAL POWER OF ATTORNEY.)

C. INFORMATION THAT IS SHARED PURSUANT TO THIS SECTION IS EXEMPT
FROM ANY CUSTOMER CONSENT OR CUSTOMER NOTICE REQUIREMENTS.

D. A FINANCIAL INSTITUTION SHALL PROVIDE TRAINING THAT INCLUDES ALL
OF THE FOLLOWING:

1. HOW TO IDENTIFY EXPLOITATION OF A FINANCIALLY VULNERABLE ADULT.

2. HOW TO REPORT SUSPECTED FINANCIAL EXPLOITATION INTERNALLY WITHIN
THE FINANCIAL INSTITUTION.

3. HOW TO REPORT SUSPECTED EXPLOITATION TO LAW ENFORCEMENT[>] [COR]
ADULT PROTECTIVE SERVICES[—O6R—-ANY-OTHER-GOVERNMENTAL ENT] .

4. HOW TO RECOGNIZE THE SIGNS OF EXPLOITATION.

5. HOW TO PROTECT CONFIDENTIAL INFORMATION.

E. A FINANCIAL INSTITUTION THAT PROVIDES EXPLOITATION TRAINING TO
IDENTIFY FINANCIALLY VULNERABLE ADULTS SHALL:

1. RETAIN A COPY OF THE TRAINING MATERIALS.

2. MAINTAIN A LIST OF EMPLOYEES WHO ATTEND THE TRAINING AND INCLUDE
THE DATES OF COMPLETION FOR EACH EMPLOYEE.

3. PROVIDE THE TRAINING MATERIALS TO THE DEPARTMENT OF INSURANCE
AND FINANCIAL INSTITUTIONS [OR—ANY—OTHER-GOVERMMHENTAL-ENTIFY] ON REQUEST.
THE FINANCIAL INSTITUTION MAY NOT DISCLOSE THE TRAINING MATERIALS TO
FORMER EMPLOYEES.

F. IF A FINANCIAL INSTITUTION HAS REASONABLE SUSPICION TO BELIEVE
THAT A FINANCIALLY VULNERABLE ADULT IS BEING OR MAY HAVE BEEN EXPLOITED,
THE FINANCIAL INSTITUTION SHALL REPORT THE BEHAVIOR TO ADULT PROTECTIVE
SERVICES[T] [OR] LAW ENFORCEMENT [OR—ANY—OTHER-GOTERNMENTAL ENTITY]. THE
FINANCIAL INSTITUTION SHALL COOPERATE IN ANY INVESTIGATION AND DISCLOSE
FINANCIAL RECORDS AND INFORMATION RELEVANT TO AN INVESTIGATION.

G. A FINANCIAL INSTITUTION IS IMMUNE FROM ANY CIVIL OR
ADMINISTRATIVE LIABILITY FOR ANY ACT TAKEN OR OMISSION MADE IN GOOD FAITH
PURSUANT TO THIS SECTION, IF THE FINANCIAL INSTITUTION PROVIDED TRAINING
TO THE FINANCIAL INSTITUTION'S EMPLOYEES.

H. FOR THE PURPOSES OF THIS SECTION:

1. "FINANCIAL INSTITUTION":

House Amendments to H.B. 2695

1 (a) HAS THE SAME MEANING PRESCRIBED IN SECTION 6-101.

2 (b) INCLUDES EMPLOYEES OF THE FINANCIAL INSTITUTION.

3 2. “FINANCIALLY VULNERABLE ADULT" [HAS THE SAME MEANING PRESCRIBED
4 IN SECTION 46-451(A)(12).) [MEANS —AtN NBT VE DUAL HOTS — ETHER OF HE
ae

6

7

8

9 Fetbertiée
10 CEPA EES

11 CHANEL CEC TUAL-BESABIEEPES

13 CI ER PESTER HEHE EN EAPAEEPYS ]

14 3. “TRUSTED CONTACT LIST" MEANS A LIST OF TRUSTED INDIVIDUALS THAT

15 A FINANCIALLY VULNERABLE ADULT SUBMITS TO A FINANCIAL INSTITUTION AND THAT
16 AUTHORIZES THE FINANCIAL INSTITUTION TO CONTACT INDIVIDUALS ON THE LIST IF
17 THE FINANCIAL INSTITUTION HAS REASONABLE CAUSE TO SUSPECT THAT THE
18 FINANCIALLY VULNERABLE ADULT IS A VICTIM OR TARGET OF EXPLOITATION.

19 Enroll and engross to conform
20 Amend title to conform

JEFF WENINGER

2695WENINGER. docx
02/17/2025

11:46 AM

H: LG/ra
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2695

DATE February 18, 2025

MOTION: I ) F A

PASS

AYE NAY PRESENT | ABSENT

Aguilar

Blackman

Cavero

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

APPROVED: .

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

S KAKAKAIAAAK

O|oO O

fea Mbt

ATTACHMENT. E

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2865: homeowners' associations; attorney fees
Sponsor: Representative Carter N, LD 15
Committee on Commerce

Overview
Precludes an association from charging or assessing their attorney fees and costs onto a
homeowner.

History
An association has a lien for homeowner expenses after the entry of a judgment in a civil sui

for those expenses from a court of competent jurisdiction and the recording of that judgment
in the office of the county recorder. A judgment or decree may include costs and reason
attorney fees for the prevailing party (A.R.S. §§ 33-1256, 33-1807).

Provisions
1. Prohibits an association from charging or otherwise assessing the association's attorney
fees and related costs onto one or more homeowners or former owners. (Sec. 1, 2)

2. Asserts all parties in any litigation, arbitration, mediation, administrative action or other
claim must bear their own attorney fees and related costs. (Sec. 1, 2)

3. Allows a homeowner to recover attorney fees and related costs against the association as
the governing documents provide. (Sec. 1, 2)

0D Prop 105 (45 votes) 0 Prop 108 (40 votes) 0 Emergency (40 votes) Fiscal Note

HB 2865
Initials PB Page 1 Commerce

~” ATTACHMENT ‘7
Fifty-seventh Legislature Commerce
First Regular Session H.B. 2865

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2865
(Reference to printed bill)

Amendment instruction key:

[GREEN UNDERLINING IN BRACKETS] indicates text added to statute or

previously enacted session law.

(Green underlining in brackets] indicates text added to new session law

or text restoring existing law.

[GREEN-STREKECUT-HI-BRACKETS] indicates new text removed from statute

or previously enacted session law.

[Green—strtkeout—irtrackets] indicates text removed from existing statute,
previously enacted session law or new session law.

<<Green carets>> indicate a section added to the bill.
<<Green—strikeout—ircarets>> indicates a section removed from the bill.

The bill as proposed to be amended is reprinted as follows:

Section 1. Title 33, chapter 9, article 3, Arizona Revised
Statutes, is amended by adding section 33-1243.01, to read:

33-1243.01. Attorney fees: costs

[A.] NOTWITHSTANDING ANY PROVISION IN THE CONDOMINIUM DOCUMENTS OR
ANY AGREEMENT BETWEEN THIRD PARTIES [AND NOTWITHSTANDING ANY OTHER
PROVISION IN THIS CHAPTER], AN ASSOCIATION SHALL NOT CHARGE OR OTHERWISE
ASSESS THE ASSOCIATION'S ATTORNEY FEES AND RELATED COSTS ONTO ONE OR MORE
UNIT OWNERS OR FORMER UNIT OWNERS. [AtE—PARTTES—HYt—ANT—CHTOATTON;
ARBITRATION HEBTATI ON HBTS FRAT EVE -AETTON BROTHER ELA SHALE BEAR
FHEER GIN ATTORNEY FEES ANB RELATED E6STS>—EXEEPT—THAF] A UNIT OWNER OR
FORMER UNIT OWNER MAY RECOVER ATTORNEY FEES AND RELATED COSTS AGAINST THE
ASSOCIATION IF ([FHE—CONDOIHATUM-BOCUMENFSSO-PROVIBE] [THE UNIT OWNER OR
FORMER UNIT OWNER PREVAILS].

[B. SUBSECTION A OF THIS SECTION DOES NOT APPLY TO ANY ACTION
BROUGHT PURSUANT TO SECTION 12-552. ]

Sec. 2. Title 33, chapter 16, article 1, Arizona Revised Statutes,
is amended by adding section 33-1803.01, to read:

OnNaAOHR WMH

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WNMrr Ow

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-

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oa

PRR
On D

19 33-1803.01. Attorney fees: costs
20 [A.] NOTWITHSTANDING ANY PROVISION IN THE COMMUNITY DOCUMENTS OR
21 ANY AGREEMENT BETWEEN THIRD PARTIES [AND NOTWITHSTANDING ANY OTHER

PROVISION IN THIS CHAPTER], AN ASSOCIATION SHALL NOT CHARGE OR OTHERWISE
ASSESS THE ASSOCIATION'S ATTORNEY FEES AND RELATED COSTS ONTO ONE OR MORE
MEMBERS OR FORMER MEMBERS. [AECK—PARTEES—Ht-ANY—CETFTGATTON, ARBETRATION;
MEBTATT ONS —ABMENT STRATA EHET TON BROTHER EAH SHALE BEAR FHETR— Ot

ATFORNEN—-FEES ANB RECATEB— COSTS EXCEPT—_TFHAF] A MEMBER OR FORMER MEMBER
MAY RECOVER ATTORNEY FEES AND RELATED COSTS AGAINST THE ASSOCIATION IF

Mh
ine}

PO PM PM PNP PP
SD OW

Withdraw

Analysts initials

ATTACHMENT ¥
House Amendments to H.B. 2865

1 [THE—ECOMMUNT HY — DOCUMENTS —SO— PROVIDE] [THE MEMBER OR FORMER MEMBER

2 PREVAILS].
3 [B. SUBSECTION A OF THIS SECTION DOES NOT APPLY TO ANY ACTION

BROUGHT PURSUANT TO SECTION 12-552. ]
5 Enroll and engross to conform
6 Amend title to conform

MICHAEL WAY

2865HATA dOoCK
6274472025
at Ht
eR

2865WAY2. docx
02/17/2025
02:22 PM

H: PB/1s
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2865

DATE February 18, 2025 motion: DPA

PASS AYE NAY PRESENT | ABSENT

Aguilar gi

Blackman

Cavero

Connolly

Diaz

Hendrix

VA
WA

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

AUINAN | INNS

ZS |1oloa

APPROVED: bey, Se CRifTARY

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT. 7
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2866: homeowner's associations; unlawful enforcement; damages
Sponsor: Representative Carter N, LD 15
Committee on Commerce

Overview
Prescribes liability damages for associations that attempt to enforce provisions of their
governing documents that are prohibited by law.

History
A unit owner or homeowner who receives a written notice that the condition of the unit

owner's or homeowner's property is in violation of a requirement of the governing documents
may provide the association with a written response within 21 calendar days after the date
of the notice. The association must respond within 10 business days of receiving the owner's
written response with a written explanation regarding the notice specifying: 1) the provision
of the governing documents that has allegedly been violated; 2) the date of the violation or
the date the violation was observed; 3) the first and last name of the person or persons who
observed the violation; and 4) the process the unit owner must follow to contest the notice.
The violation notice must include the process to contest the notice in order for the association
to proceed with any action to enforce the governing documents and provide information on
petitioning the Arizona Department of Real Estate for an administrative hearing regarding
a dispute (A.R.S. §§ 33-1242, 33-1803).

Provisions
1. Stipulates an association that attempts to enforce any provision of their governing
documents that is prohibited by law is liable for the following damages:
a) for a first attempt to enforce, $1,000;
b) for a second attempt to enforce, $10,000;
c) fora third and any additional attempts to enforce, $100,000. (Sec. 1, 2)

2. Specifies the association's liability accrues based on the number of attempts to enforce
without regard to whether enforcement is attempted against the same or different unit
owners of the condominium, or members of the planned community. (Sec. 1,2)

3. Asserts a unit owner, or member, has recourse for damages against the association in any
court of competent jurisdiction. (Sec. 1, 2)

0D Prop 105 (45 votes) 0 Prop 108 (40 votes) 0 Emergency (40 votes) O Fiscal Note

HB 2866
Initials PB Page 1 Commerce

ATTACHMENT |O
Fifty-seventh Legislature Commerce
First Regular Session H.B. 2866

ON OOP WDM FE

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2866
(Reference to printed bill)

Amendment instruction key:

[GREEN UNDERLINING IN BRACKETS] indicates text added to statute or

previously enacted session law.

(Green underlining in brackets] indicates text added to new session law

or text restoring existing law.

[GREEN-STRIKECUT-F- BRACKETS] indicates new text removed from statute

or previously enacted session law.

(Green—str+keout—inrbrackets] indicates text removed from existing statute,
previously enacted session law or new session law.

<<Green carets>> indicate a section added to the bill.

<<Green—strikeout—itr-carets>> indicates a section removed from the bill.

The bill as proposed to be amended is reprinted as follows:
Section 1. Section 33-1242, Arizona Revised Statutes, is amended to

read:
33-1242. Powers of unit owners" association; notice to unit
owner of violation: enforcement; damages
A. Subject to the provisions of the declaration, the association
may:

1. Adopt and amend bylaws and rules.

2. Adopt and amend budgets for revenues, expenditures and reserves
and collect assessments for common expenses from unit owners.

3. Hire and discharge managing agents and other employees, agents
and independent contractors.

4. Institute, defend or intervene in litigation or administrative
proceedings in its own name on behalf of itself or two or more unit owners
on matters affecting the condominium.

5. Make contracts and incur liabilities.

6. Regulate the use, maintenance, repair, replacement and
modification of common elements.

7. Cause additional improvements to be made as a part of the common
elements.

8. Acquire, hold, encumber and convey in its own name any right,
title or interest to real or personal property, except that common
elements may be conveyed or subjected to a security interest only pursuant
to section 33-1252.

9. Grant easements, leases, licenses and concessions through or
over the common elements.

10. Impose and receive any payments, fees or charges for the use,
rental or operation of the common elements other than limited common

Adopter

ile

Not Offere:

House Amendments to H.B. 2866

OnNAD OP WM Fe

elements described in section 33-1212, paragraphs 2 and 4 and for services
provided to unit owners.

11. Impose charges for late payment of assessments after the
association has provided notice that the assessment is overdue or provided
notice that the assessment is considered overdue after a certain date and,
after notice and an opportunity to be heard, impose reasonable monetary
penalties on unit owners for violations of the declaration, bylaws and
rules of the association.

12. Impose reasonable charges for the preparation and recordation
of amendments to the declaration or statements of unpaid assessments.

13. Provide for the indemnification of its officers and executive
board of directors and maintain directors' and officers’ liability
insurance.

14. Assign its right to future income, including the right to
receive common expense assessments, but only to the extent the declaration
expressly provides.

15. Be a member of a master association or other entity owning,
maintaining or governing in any respect any portion of the common elements
or other property benefitting or related to the condominium or the unit
owners in any respect.

16. Exercise any other powers conferred by the declaration or
bylaws.

17. Exercise all other powers that may be exercised in this state
by legal entities of the same type as the association.

18. Exercise any other powers necessary and proper for’ the
governance and operation of the association.

B. A unit owner who receives a written notice that the condition of
the property owned by the unit owner is in violation of a requirement of
the condominium documents without regard to whether a monetary penalty is
imposed by the notice may provide the association with a written response
by sending the response by certified mail within twenty-one calendar days
after the date of the notice. The response shall be sent to the address
identified in the notice.

C. Within ten business days after receipt of the certified mail
containing the response from the unit owner, the association shall respond
to the unit owner with a written explanation regarding the notice that
shall provide at least the following information unless’ previously
provided in the notice of violation:

1. The provision of the condominium documents that has allegedly
been violated.

2. The date of the violation or the date the violation was
observed.

3. The first and last name of the person or persons who observed
the violation.

4, The process the unit owner must follow to contest the notice.

D. Unless the information required in subsection C, paragraph 4 of
this section is provided in the notice of violation, the association shall
House Amendments to H.B. 2866

OND O HP WM

not proceed with any action to enforce the condominium documents,
including the collection of attorney fees, before or during the time
prescribed by subsection C of this section regarding the exchange of
information between the association and the unit owner and shall give the
unit owner written notice of the unit owner's option to petition for an
administrative hearing on the matter in the state real estate department
pursuant to section 32-2199.01. At any time before or after completion
of the exchange of information pursuant to this section, the unit owner
may petition for a hearing pursuant to section 32-2199.01 if the dispute
is within the jurisdiction of the state real estate department as
prescribed in section 32-2199.01.

E. IF AN ASSOCIATION ATTEMPTS TO ENFORCE ANY PROVISION OF THE
DECLARATION, BYLAWS OR RULES OF THE ASSOCIATION THAT IS PROHIBITED BY LAW,
THE ASSOCIATION IS LIABLE FOR DAMAGES TO THE UNIT OWNER AS FOLLOWS:

1. FOR A FIRST ATTEMPT TO ENFORCE, $1,000.

[2.—FERTASECONB ATTEMPT ENFORCE $16; 6667 J

[37] (2.] FOR A (THFRB] [SECOND] AND ANY ADDITIONAL ATTEMPTS TO
ENFORCE, ([$t66>666] [$2,500].

F. THE ASSOCIATION'S LIABILITY PRESCRIBED BY SUBSECTION E OF THIS
SECTION ACCRUES BASED ON THE NUMBER OF ATTEMPTS TO ENFORCE WITHOUT REGARD
TO WHETHER ENFORCEMENT IS ATTEMPTED AGAINST THE SAME OR DIFFERENT UNIT
OWNERS OF THE CONDOMINIUM. A UNIT OWNER HAS RECOURSE FOR DAMAGES AGAINST
THE ASSOCIATION IN ANY COURT OF COMPETENT JURISDICTION.

Sec. 2. Section 33-1803, Arizona Revised Statutes, is amended to

read:

33-1803. Assessment limitation; penalties: notice to member

of violation; enforcement; damages

A. Unless limitations in the community documents would result in a
lower limit for the assessment, the association shall not impose a regular
assessment that is more than twenty percent greater than the immediately
preceding fiscal year's assessment without the approval of the majority of
the members of the association. Unless reserved to the members of the
association, the board of directors may impose reasonable charges for the
late payment of assessments. A payment by a member is deemed late if it
is unpaid fifteen or more days after its due date, unless the community
documents provide for a longer period. Charges for the late payment of
assessments are limited to the greater of frfteer-totters $15 or ten
percent of the amount of the unpaid assessment and may be imposed only
after the association has provided notice that the assessment is overdue
or provided notice that the assessment is considered overdue after a
certain date. Any monies paid by the member for an unpaid assessment
shall be applied first to the principal amount unpaid and then to the
interest accrued.

B. After notice and an opportunity to be heard, the board of
directors may impose reasonable monetary penalties on members for
violations of the declaration, bylaws and rules of the association.
Notwithstanding any provision in the community documents, the board of

House Amendments to H.B. 2866

OnNanfR WDM FE

directors shall not impose a charge for a late payment of a penalty that
exceeds the greater of fifteercottars $15 or ten percent of the amount of
the unpaid penalty. A payment is deemed late if it is unpaid fifteen or
more days after its due date, unless the declaration, bylaws or rules of
the association provide for a longer period. Any monies paid by a member
for an unpaid penalty shall be applied first to the principal amount
unpaid and then to the interest accrued. Notice pursuant to this
subsection shall include information pertaining to the manner in which the
penalty shall be enforced.

C. A member who receives a written notice that the condition of the
property owned by the member is in violation of the community documents
without regard to whether a monetary penalty is imposed by the notice may
provide the association with a written response by sending the response by
certified mail within twenty-one calendar days after the date of the
notice. The response shall be sent to the address identified in the
notice.

D. Within ten business days after receipt of the certified mail
containing the response from the member, the association shall respond to
the member with a written explanation regarding the notice that shall
provide at least the following information unless previously provided in
the notice of violation:

1. The provision of the community documents that has allegedly been
violated.

2. The date of the violation or the date the violation was
observed.

3. The first and last name of the person or persons who observed
the violation.

4. The process the member must follow to contest the notice.

E. Unless the information required in subsection D, paragraph 4 of
this section is provided in the notice of violation, the association shall
not proceed with any action to enforce the community documents, including
the collection of attorney fees, before or during the time prescribed by
subsection D of this section regarding the exchange of information between
the association and the member and shall give the member written notice of
the member's option to petition for an administrative hearing on the
matter in the state real estate department pursuant to section
32-2199.01. At any time before or after completion of the exchange of
information pursuant to this section, the member may petition for a
hearing pursuant to section 32-2199.01 if the dispute is within the
jurisdiction of the state real estate department as prescribed in section
32-2199.01.

F. IF AN ASSOCIATION ATTEMPTS TO ENFORCE ANY PROVISION OF THE
DECLARATION, BYLAWS OR RULES OF THE ASSOCIATION THAT IS PROHIBITED BY LAW,
THE ASSOCIATION IS LIABLE FOR DAMAGES TO THE MEMBER AS FOLLOWS:

1. FOR A FIRST ATTEMPT TO ENFORCE, $1,000.

[2-—FOR-ASECONB ATTEMPT —TO-ENFOREE, $105 006-4
House Amendments to H.B. 2866

1 [3-] (2.] FOR A [#HtRB] [SECOND] AND ANY ADDITIONAL ATTEMPTS TO
2 ENFORCE, [4t06-666] [$2,500].

3 G. THE ASSOCIATION'S LIABILITY PRESCRIBED BY SUBSECTION F OF THIS
4 SECTION ACCRUES BASED ON THE NUMBER OF ATTEMPTS TO ENFORCE WITHOUT REGARD
5 TO WHETHER ENFORCEMENT IS ATTEMPTED AGAINST THE SAME OR DIFFERENT MEMBERS
6 OF THE PLANNED COMMUNITY. A MEMBER HAS RECOURSE FOR DAMAGES AGAINST THE
7 ASSOCIATION IN ANY COURT OF COMPETENT JURISDICTION.

8 Enroll and engross to conform

9 Amend title to conform

MICHAEL WAY

2866WAY1.docx
02/14/2025
11:42 AM

H: PB/1s
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2866

DATE February 18, 2025 MOTION: | ) PA

PASS AYE NAY PRESENT | ABSENT

Aguilar gi

Blackman

Cavero

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

OK KR IANAAAIN

/ Oo | oO

APPROVED: COMMITTEE SECRET,
JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT. } z=
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2787: ground ambulances; registration
Sponsor: Representative Willoughby, LD 13
Committee on Commerce

Overview
An emergency measure that extends the validity of a certificate of registration.

History
The Department of Health Services (DHS) is statutorily required to adopt rules to regulate

the operation of ambulances and ambulance services. Such rules must provide for DHS to: 1)
determine, fix, alter and regulate just, reasonable and sufficient rates and charges for
ambulances; 2) regulate operating and response times of ambulances to meet the needs of
the public and to ensure adequate service; and 3) inspect, at a maximum of 12-month
intervals, each registered ambulance to ensure that the vehicle is operation and safe and that
all required medical equipment is operational. The director of DHS may inquire into the
operation of an ambulance service, including a person operating an ambulance that has not
been issued a certificate of registration or a person who does not have or is operating outside
of a certificate of necessity (A.R.S. § 36-2232).

A person must apply for and obtain a certificate of registration in order to operate an
ambulance. A person may be issued a certificate of registration by paying an initial
registration fee and demonstrating to the director's satisfaction that they are in compliance
with statute and all rules, standards and criteria adopted by DHS for the operation of an
ambulance. A certificate of registration is valid for one year. However, an ambulance service
may request that DHS issue an initial certificate of registration that expires before the end
of one year in order for DHS to conduct an annual inspection of all of the ambulance service's
ambulances at one time (A.R.S. § 36-2212).

Provisions

1. Stipulates that if DHS fails to schedule or perform an inspection of an ambulance within
the prescribed time frame, an ambulance's registration remains valid and in effect until:
a) DHS completes the required inspection; and
b) the certificate of registration holder complies with the renewal process. (Sec. 1)

2. Asserts DHS's failure to issue or renew a certificate of registration within DHS's
established time frames does not invalidate or delay the effective date of the certificate of
registration. (Sec. 1)

Contains a legislative intent clause. (Sec. 2)
Applies retroactively to April 1, 2021. (Sec. 3)

Contains an emergency clause. (Sec. 4)

OO Prop 105 (45 votes) OF Prop 108 (40 votes) & Emergency (40 votes) O Fiscal Note

HB 2787
Initials Page 1 Commerce

ATTACHMENT | 3
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. __HB 2787

DATE February 18, 2025 MOTION: p

PASS AYE NAY PRESENT | ABSENT

Aguilar a

Blackman

Cavero

Connolly

Diaz

Hendrix

Ve

Villegas
Wilmeth
Way, Vice-Chairman

Weninger, Chairman

PYAL INV AKARKT A

SS OQ | /

Fike Aaljee

APPROVED: . COMMITTEE SEGRE AARY
WW fie

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT. | 4
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2387: cryptocurrency kiosk; license; fraud prevention
Sponsor: Representative Marshall, LD 7
Committee on Commerce

Overview
Provides requirements for operating a cryptocurrency kiosk.

History
The Department of Insurance and Financial Institutions (DIFI) is responsible for regulating

the insurance industry, financial institutions and enterprises and financial services and
insurance professionals, including money transmitters and the transmission of money.

Money transmission means: 1) selling or issuing payment instruments to a person located in
this state; 2) selling or issuing stored value to a person located in this state; and 3) receiving
money for transmission from a person located in this state (A.R.S. § 6-1201).

Provisions
1. Stipulates, beginning January 1, 2026, a cryptocurrency kiosk operator must be licensed
by DIFI to conduct a virtual business or advertise a virtual business. (Sec. 1)

2. Instructs a cryptocurrency kiosk operator to provide to any governmental entity, on
request, a list of any cryptocurrency kiosks that is owned, operated or managed by the
operator. (Sec. 1)

3. Prevents a cryptocurrency kiosk operator from locating or allowing a third party to locate
a cryptocurrency kiosk unless the operator is licensed to perform money transmission
pursuant to statute. (Sec. 1)

4, Requires a cryptocurrency kiosk operator to notify DIFI within 10 business days if there
are any changes to outlined information relating to the business or the cryptocurrency
kiosk. (Sec. 1)

5. Delineates the records a cryptocurrency kiosk operator must maintain as secured,
encrypted data, for at least five years relating to the virtual currency business activity.
(Sec. 1)

6. Instructs the Attorney General to enforce cryptocurrency kiosk operator provisions. (Sec.
1)

7. Adds that any act or practice that violates cryptocurrency kiosk operator provisions is a
violation of money transmission statutes and the Consumer Fraud Act. (Sec. 1)

8. Requires the cryptocurrency kiosk operator to disclose, in a clear, conspicuous and
readable manner, all relevant terms and conditions that are associated with the products,
services and activities of the operator and virtual currency. (Sec. 1)

Oi Prop 105 (45 votes) O Prop 108 (40 votes) O Emergency (40 votes) UO Fiscal Note

HB 2387
Initials PB Page 1 Commerce

ATTACHMENT JS
9. Specifies the cryptocurrency kiosk operator must receive a receipt acknowledging all
required disclosures from a customer through consent or confirmation. (Sec. 1)

10. Instructs the cryptocurrency kiosk operator to provide outlined disclosures separately
from the appearance of a specified written warning. (Sec. 1)

11. Requires the customer to accept the disclosures before executing a cryptocurrency
transaction. (Sec. 1)

12. Permits a cryptocurrency kiosk transaction if specified information is disclosed to a
consumer. (Sec. 1)

13. Requires a cryptocurrency kiosk operator, on the completion of each kiosk transaction, to
provide an individual with a physical receipt containing specified information. (Sec. 1)

14. Instructs a cryptocurrency kiosk operator to use blockchain analytics and tracing
software to help prevent fraud by sending purchased virtual currency from an operator
to a virtual wallet known to be affiliated with fraud at the time of a transaction. (Sec. 1)

15. Allows a relevant government entity to request evidence from a cryptocurrency kiosk
operator showing current use of blockchain analytics. (Sec. 1)

16. Requires a cryptocurrency operator to take reasonable steps to detect and prevent fraud,
including establishing and maintaining a written anti-fraud policy, conforming to federal
know your consumer and anti-money laundering laws. (Sec. 1)

17. Asserts the anti-fraud policy must include:
a) identification and assessment of fraud related to risk areas;
b) procedures and controls to protect against identified risks;
c) allocation of responsibility for monitoring risks; and
d) procedures for the periodic evaluation and revision of the anti-fraud procedures,
controls and monitoring mechanisms. (Sec. 1)

18. Requires a cryptocurrency kiosk operator to designate and employ a compliance officer
with the following requirements:
a) the ability to coordinate and monitor compliance with state and federal rules and
regulations;
b) full-time employment by the cryptocurrency kiosk operator; and
c) must not own more than twenty percent of the cryptocurrency kiosk operator. (Sec. 1)

19. Prohibits a cryptocurrency operator from accepting more than $1,000 U.S. dollars in cash
or the equivalent in virtual currency in one day from an Arizona customer. (Sec. 1)

20. Requires a cryptocurrency kiosk operator performing business in this state to provide live
customer service for a minimum of 24 hours a day, 7 days per week. (Sec. 1)

21. Requires the cryptocurrency kiosk or the cryptocurrency kiosk screen to display the toll-
free customer service number. (Sec. 1)

22. Defines pertinent terms. (Sec. 1)

HB 2387
Initials PB Page 2 Commerce
Fifty-seventh Legislature Commerce

First Regular Session H.B. 2387
PROPOSED

HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2387
(Reference to printed bill)

Amendment instruction key:

[GREEN UNDERLINING IN BRACKETS] indicates text added to statute or

previously enacted session law.
[Green underlin ackets] indicates text added to new session law

or text restoring existing law.

[LGREEN-SFRIKEGUT-HE-BRACKETS] indicates new text removed from statute

or previously enacted session law.

(Green-strtkeout—irtrackets] indicates text removed from existing statute,

previously enacted session law or new session law.
<<Green carets>> indicate a section added to the bill.

<<Green—strikeout—itr-carets>> indicates a section removed from the bill.

1 The bill as proposed to be amended is reprinted as follows:

2 Section 1. Title 6, chapter 12, article 1, Arizona Revised
3 Statutes, is amended by adding section 6-1236, to read:

4 6-1236. Cryptocurrency kiosk operator; attorney general:

5

6

7

8

fraud prevention: definitions

TU 5

“Adopied_v“ ttofVetbnls |

fhe keg

Not Offered___ Analysts Initials__

(ATIACHMENT |G
House Amendments to H.B. 2387

1
2
3
4
5
6
7
8

SECTION -F4-1522-F
([@-] [A.J] A CRYPTOCURRENCY KIOSK OPERATOR SHALL DISCLOSE IN A
CLEAR, CONSPICUOUS AND EASILY READABLE AND UNDERSTANDABLE MANNER IN THE

CHOSEN LANGUAGE OF THE CUSTOMER ALL RELEVANT TERMS AND CONDITIONS THAT ARE
GENERALLY ASSOCIATED WITH THE PRODUCTS, SERVICES AND ACTIVITIES OF THE
CRYPTOCURRENCY KIOSK OPERATOR AND VIRTUAL CURRENCY. THE CRYPTOCURRENCY
KIOSK OPERATOR SHALL RECEIVE AN ACKNOWLEDGMENT OF RECEIPT OF ALL
DISCLOSURES REQUIRED UNDER THIS SECTION FROM A _ CUSTOMER THROUGH
CONFIRMATION OR CONSENT.

(t7] [B.] A  CRYPTOCURRENCY KIOSK OPERATOR SHALL PROVIDE THE
FOLLOWING DISCLOSURES SEPARATELY IN A FONT THAT CONTRASTS WITH THE
BACKGROUND WHERE THE WRITTEN WARNING APPEARS AND THE CUSTOMER MUST ACCEPT
[THE TWO SEPARATE] THE DISCLOSURES BEFORE EXECUTING A CRYPTOCURRENCY
TRANSACTION.

1. WARNING: CONSUMER FRAUD OFTEN STARTS WITH CONTACT

FROM A STRANGER WHO IS INITIATING A DISHONEST SCHEME OR A

CRIMINAL OR FRAUDULENT ACTIVITY THAT MAY APPEAR IN MANY FORMS,

INCLUDING ANY OF THE FOLLOWING:

(a) CLAIMS OF A FROZEN BANK ACCOUNT OR CREDIT CARD.
(b) CLAIMS OF A FRAUDULENT BANK TRANSACTION.
(c) CLAIMS OF IDENTITY THEFT OR AN OFFER OF EMPLOYMENT

IN EXCHANGE FOR PAYMENT.

House Amendments to H.B. 2387

1 (d) REQUESTS FOR A PAYMENT TO A GOVERNMENT AGENCY OR
Z COMPANY.

3 (e) REQUESTS FOR DISASTER RELIEF DONATIONS OR LOANS.

4 (f) OFFERS TO PURCHASE LOTTERY TICKETS OR SWEEPSTAKES
5 OR DRAWINGS FOR VEHICLES.

6 (g) PROMPTS TO CLICK ON DESKTOP POP-UPS THAT INCLUDE
7 VIRUS WARNINGS OR COMMUNICATION FROM ALLEGED FAMILIAR
8 MERCHANTS.

9 (h) COMMUNICATION FROM SOMEONE IMPERSONATING A
10 REPRESENTATIVE OF YOUR BANK OR A LAW ENFORCEMENT OFFICER.

i! IF YOU BELIEVE YOU HAVE BEEN SCAMMED, STOP AND CALL YOUR
12 LOCAL LAW ENFORCEMENT AND THE CRYPTOCURRENCY KIOSK OPERATOR.
13 2. WARNING: LOSSES DUE TO FRAUDULENT OR ACCIDENTAL
14 TRANSACTIONS ARE NOT RECOVERABLE. TRANSACTIONS IN VIRTUAL
15 CURRENCY ARE IRREVERSIBLE. PEOPLE MAY USE VIRTUAL CURRENCY
16 TRANSACTIONS TO STEAL YOUR MONEY BY IMPERSONATING THE
17 GOVERNMENT, ORGANIZATIONS OR PEOPLE YOU KNOW. IMPERSONATORS
18 MAY THREATEN JAIL TIME, SAY YOUR IDENTITY HAS BEEN STOLEN,
19 ALLEGE YOUR COMPUTER HAS BEEN HACKED, INSIST YOU WITHDRAW
20 MONEY FROM YOUR BANK ACCOUNT TO PURCHASE VIRTUAL CURRENCY OR
21 USE A NUMBER OF OTHER SCAMS. DO NOT DISCLOSE YOUR PRIVATE KEY
22 THAT IS ASSOCIATED WITH YOUR VIRTUAL WALLET TO A THIRD PARTY.
Za IF YOU BELIEVE YOU ARE BEING SCAMMED, STOP AND CALL YOUR LOCAL
24 LAW ENFORCEMENT AND THE CRYPTOCURRENCY KIOSK OPERATOR.

25 [LE —AERTPFOECURREN EY -REOSK-FTRANSACTEON-ESAECORER- TF-THE--F CEC OHAENG

House Amendments to H.B. 2387

1
2
3
4
5 e
6
i
8
9

PARTEESHTTHOUT A EOURTORBER-OR-GOVERNMENT-ORBER ST

[37] [C.J] ON THE COMPLETION OF EACH’ CRYPTOCURRENCY KIOSK
TRANSACTION, THE CRYPTOCURRENCY KIOSK OPERATOR SHALL PROVIDE AN INDIVIDUAL
[WHO MADE THE TRANSACTION AT THE CRYPTOCURRENCY KIOSK] WITH A PHYSICAL [OR
DIGITAL] RECEIPT IN THE LANGUAGE CHOSEN BY THE INDIVIDUAL THAT CONTAINS
ALL OF THE FOLLOWING INFORMATION:

1. THE  CRYPTOCURRENCY KIOSK OPERATOR'S NAME AND ~~ CONTACT
INFORMATION, INCLUDING A TELEPHONE NUMBER TO ANSWER QUESTIONS AND REGISTER
COMPLAINTS.

2. THE STATE AND LOCAL LAW ENFORCEMENT OR GOVERNMENT AGENCY THAT
RECEIVES COMPLAINTS OF FRAUD.

3. THE TYPE, VALUE, DATE AND PRECISE TIME OF A TRANSACTION, THE
TRANSACTION HASH AND EACH APPLICABLE VIRTUAL CURRENCY ADDRESS.

4. THE NAME AND CONTACT INFORMATION OF THE SENDER.

5. THE NAME, CONTACT INFORMATION AND VIRTUAL WALLET NUMBER OF THE
DESIGNATED RECIPIENT.

6. DAI FEES CHARGED. FOR THE PURPOSES OF THIS PARAGRAPH, “DAI"
MEANS A DECENTRALIZED STABLECOIN TOKEN THAT IS DESIGNED TO MAINTAIN A
VALUE OF THE UNITED STATES DOLLAR.

7. THE EXCHANGE RATE OF THE VIRTUAL CURRENCY TO THE UNITED STATES
DOLLAR.

House Amendments to H.B. 2387

FPPFPHPHPPP PW WW WW W WW W WH Dw PS
PM PM PH PM PP alll eel met

ONO WDM FE

8. A STATEMENT OF THE CRYPTOCURRENCY KIOSK OPERATOR'S REFUND
POLICY.

9. ANY ADDITIONAL INFORMATION THAT A GOVERNMENT AUTHORITY MAY
REQUIRE.

[t7] [D.] ALL CRYPTOCURRENCY KIOSK OPERATORS SHALL TAKE REASONABLE
STEPS TO DETECT AND PREVENT FRAUD, INCLUDING ESTABLISHING AND MAINTAINING
A WRITTEN ANTI-FRAUD POLICY AND CONFORMING TO FEDERAL KNOW YOUR CONSUMER
AND ANTI-MONEY LAUNDERING LAWS. [FHE—ANTE-FRAUD—POLTEY SHALES —AT—*

Ctr] [E.] A  CRYPTOCURRENCY KIOSK OPERATOR MAY NOT ACCEPT
TRANSACTIONS OF MORE THAN [4#t,666] [$2.000] UNITED STATES DOLLARS IN CASH
OR THE EQUIVALENT IN VIRTUAL CURRENCY IN ONE DAY FROM A CUSTOMER IN THIS
STATE THROUGH ONE OR MORE CRYPTOCURRENCY KIOSKS.

([4>] [E.] ALL CRYPTOCURRENCY KIOSK OPERATORS PERFORMING BUSINESS IN
THIS STATE SHALL PROVIDE LIVE CUSTOMER SERVICE AT A MINIMUM OF TWENTY-FOUR
HOURS A DAY, SEVEN DAYS PER WEEK. THE CUSTOMER SERVICE TOLL-FREE NUMBER
SHALL BE PROMINENTLY DISPLAYED ON THE CRYPTOCURRENCY KIOSK OR THE
CRYPTOCURRENCY KIOSK SCREENS.

[G. THE ATTORNEY GENERAL SHALL ENFORCE THIS SECTION. ANY ACT OR
PRACTICE THAT VIOLATES THIS SECTION IS A VIOLATION OF SECTION 44-1522.)

[N+] [H.] FOR THE PURPOSES OF THIS SECTION:

[17 —*BLOEREHAEN ANALYTES *—_HEANS THE ANALYSTS — OF — BATA— FROM
BLOEKEHATNS — OR — PUBL EE — BTS TFRIBUTER— €EBGERS, TNE CUB ENG — ASSOETATED
FRANSACT EON -TANFORMATEON|

27" BLO EREH ATEN ANALY FTES ANBFRACENE SOF THARE“TEANS—A—_ SOF THARE
SERVICE —THATF—_USES— BLO EKEHATN ANALY TEES — BATA FO PROVEBE-RT SK SPECTFEE

House Amendments to H.B. 2387

1 ORMATEONAND

2 VERTUALCTTENS—]

3 [37] [1.] “CRYPTOCURRENCY KIOSK":

4 (a) MEANS A PHYSICAL, ELECTRONIC TERMINAL THAT IS A MECHANICAL
5 AGENT OF THE CRYPTOCURRENCY KIOSK OPERATOR AND THAT ENABLES A
6 CRYPTOCURRENCY KIOSK OPERATOR TO FACILITATE THE PURCHASE, SALE OR EXCHANGE
7 OF CRYPTOCURRENCY FOR MONEY, BANK CREDIT OR OTHER VIRTUAL CURRENCY.

8 (b) INCLUDES A VIRTUAL CURRENCY EXCHANGE, WHICH PERFORMS THE ACTUAL

9 VIRTUAL CURRENCY TRANSMISSION OR DRAWING ON THE VIRTUAL CURRENCY THAT IS
10 IN THE POSSESSION OF THE ELECTRONIC TERMINAL OPERATOR.

| 11 [47] [2.] "CRYPTOCURRENCY KIOSK OPERATOR" MEANS AN INDIVIDUAL OR
12 ENTITY:
1d (a) THAT ENGAGES IN VIRTUAL CURRENCY BUSINESS ACTIVITY THROUGH A
14 MONEY TRANSMISSION KIOSK IN THIS STATE.
15 (b) THAT OPERATES OR MANAGES A MONEY TRANSMISSION KIOSK WHERE
16 VIRTUAL CURRENCY BUSINESS ACTIVITY IS OFFERED IN THIS STATE.

| L? (S57] [3.] “CRYPTOCURRENCY KIOSK TRANSACTION" MEANS BOTH:
18 (a) A TRANSACTION CONDUCTED OR PERFORMED, IN WHOLE OR IN PART, BY
19 ELECTRONIC MEANS THROUGH A CRYPTOCURRENCY KIOSK.
20 (b) A TRANSACTION MADE AT A _ CRYPTOCURRENCY KIOSK TO PURCHASE

21 VIRTUAL CURRENCY WITH FIAT CURRENCY OR TO SELL VIRTUAL CURRENCY FOR FIAT
22 CURRENCY.

| 23 [67] [4.] “TRANSACTION HASH" MEANS A UNIQUE IDENTIFIER MADE UP OF A
24 STRING OF CHARACTERS THAT ACT AS A RECORD OF, AND PROVIDE PROOF THAT, THE
25 TRANSACTION WAS VERIFIED AND ADDED TO THE BLOCKCHAIN.

| 26 [7+] [5.] “VIRTUAL CURRENCY ADDRESS":
27 (a) MEANS A UNIQUE PUBLIC ALPHANUMERIC IDENTIFIER THAT IS
28 ASSOCIATED WITH A VIRTUAL CURRENCY TYPE AND WALLET AND THAT IDENTIFIES THE
29 LOCATION WHERE VIRTUAL CURRENCY TRANSACTION CAN BE SENT.

30 (b) IS REFERRED TO AS A PUBLIC KEY.

| 31 [6] [6.] “VIRTUAL WALLET":
32 (a) MEANS A SOFTWARE APPLICATION OR OTHER MECHANISM THAT PROVIDES A
33 MEANS TO HOLD, STORE OR TRANSFER VIRTUAL CURRENCY OR NONFUNGIBLE TOKENS.
34 (b) INCLUDES A PUBLIC KEY, PRIVATE KEY AND A PUBLIC RECEIVING

35 ADDRESS. FOR THE PURPOSES OF THIS SUBDIVISION, A PRIVATE KEY MAY BE USED
36 TO SIGN FOR A TRANSACTION WHEN SENDING CRYPTOCURRENCY FROM A VIRTUAL
37 WALLET.

38 Enroll and engross to conform
39 Amend title to conform

JEFF WENINGER
2387WENINGER2. docx
02/13/2025
02:56 PM
H: PB/1s
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

COMMITTEE ON

ROLL CALL VOTE

Commerce

BILL NO. __HB 2387

DATE

February 18, 2025

MOTION: DD PA,

PASS

AYE

NAY PRESENT | ABSENT

Aguilar

Blackman

Cavero

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

APPROVED:

Vol Vrra—

“JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

PIN) AAKAIARARS

ATTACHMENT. | |

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2873: tourism improvement areas; municipalities; counties
Sponsor: Representative Wilmeth, LD 2
Committee on Commerce

Overview
Enables a governing body to approve the formation of a tourism improvement area.

History
Special taxing 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.

Title 48 of the Arizona Revised Statutes currently allows and outlines the process for the
formation of various types of special taxing districts including fire districts, irrigation
districts, hospital districts, pest abatement districts and power districts. Although the
specific process depends on the type of district created, the formation in many cases requires
the submission of petitions to the county board of supervisors (county BOS), followed by a
public hearing. Sometimes an election may be required to form a district.

Provisions
Tourism Improvement Area

1. Authorizes a governing body, on presentation of a petition, to approve the formation of a
tourism improvement area. (Sec. 1)

2. Delineates information that a petition for the formation of the tourism improvement area
must include. (Sec. 1)

3. Allows a lodging business owner to appoint an authorized agent to act as the lodging
business owner's representative. (Sec. 1)

4. Deems the lodging business owner's representative as the business owner for the
purposes of any signature required or other purpose authorized by the lodging business
owner. (Sec. 1)

5. Asserts a governing body has no obligation to obtain other information as to the
ownership of the lodging business and its determination of ownership is final and
conclusive. (Sec. 1)

Tourism Improvement Area Plan

O Prop 105 (45 votes) O Prop 108 (40 votes) 0 Emergency (40 votes) O Fiscal Note

HB 2873
Initials PB Page 1 Commerce

ATTACHMENT / &
10.

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Requires a tourism improvement area plan to be prepared before a required public
hearing on the proposed tourism improvement area is held. (Sec. 1)

Outlines information that must be included in the tourism improvement area plan. (Sec.
1)

Asserts lodging business assessments levied will provide benefits to lodging businesses
located within the tourism improvement area that are subject to the assessment. (Sec. 1)

Specifies that lodging business assessments may vary by types or classes of lodging
businesses as described in the tourism improvement area plan. (Sec. 1)

Allows the lodging business assessment to be levied based on:
a) a fixed amount;

b) rate per transaction;

c) fixed rate per transaction per day;

d) percentage of sales; or

e) any combination of such methods. (Sec. 1)

Outlines stipulations for contesting the validity of a lodging business assessment. (Sec. 1)

Requires tourism improvement area activities be designed to promote tourism and
lodging to enhance the economic development climate in the improvement area. (Sec. 1)

Allows tourism improvement area activities to supplement, but not replace governmental
services including the planning, administration and management of activities designed
to benefit the tourism improvement area. (Sec. 1)

Tourism Improvement Area Formation

Requires a governing body, upon receipt of a valid petition, to adopt a resolution of
intention to consider the formation of a tourism improvement area. (Sec. 1)

Outlines information which must be included in the resolution of intention, including the
date, time and place of a public hearing to consider the petition for formation of a tourism
improvement area. (Sec. 1)

Provides requirements for noticing the public hearing. (Sec. 1)

Instructs the governing body to conduct the public hearing at least 30 days after mailing
the notice to all lodging business owners identified in the notice. (Sec. 1)

Requires the governing body to consider public testimony regarding a proposed tourism
improvement area. (Sec. 1)

Allows an assessed lodging business to submit a written objection to the governing body
prior to the conclusion of the public hearing (Sec. 1)

Stipulates for written objections received from lodging business owners representing 50%

or more of the total rooms within the proposed tourism improvement area:

a) the public hearing must end; and

b) no further proceedings on the formation of the tourism improvement area may be held
for a period of one year after the date of the hearing. (Sec. 1)

Allows a governing body to adopt a resolution forming a proposed tourism improvement
area provided the governing body determines that the written objections submitted total
less than 34% of total rooms within a proposed tourism improvement area. (Sec. 1)

HB 2873

Initials PB Page 2 Commerce
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Prohibits the governing body of a municipality from forming a proposed tourism
improvement area in an unincorporated territory of a county without consent from the
county board of supervisors. (Sec. 1)

Prohibits a governing body or board of supervisors from forming a tourism improvement
area within territorial jurisdiction of another municipality or county without consent of
the governing body or board of supervisors of that area. (Sec. 1)

Allows for the boundaries of tourism improvement areas to overlap with another tourism
improvement area boundary or district created for special assessments. (Sec. 1)

Limits the initial term and subsequent renewals of the tourism improvement area to 10
years. (Sec. 1)

Requires any lodging business subject to lodging business assessment commencing
operations during the term of a tourism improvement area be subject to the lodging
business assessment. (Sec. 1)

Tourism Improvement Area Management

Requires an owners' association to manage the tourism improvement area and be
contracted with the governing body to administer the tourism improvement area
activities. (Sec. 1)

Requires, for newly formed nonprofit corporations designated as the owner's association,
the certificate of incorporation or bylaws provide that the governing board of the owners'
association be composed of a majority of the lodging business owners, or their
representatives located within the tourism improvement area. (Sec. 1)

Allows for a representative of a municipality or county to have a nonvoting, ex officio seat
on the governing board.

Provides requirements for an existing nonprofit corporation that is designated as the
owners' association. (Sec. 1)

Asserts a tourism improvement area owners' association authority includes any powers
possessed by a nonprofit corporation, including accepting donations and receiving grants.

(Sec. 1)

Provides reporting requirements for the governing board of the tourism improvement
area owners' association. (Sec. 1)

Tourism Improvement Area Plan Amendments

Allows a governing body to amend the tourism improvement area plan on written request
of the tourism improvement area owners' association. (Sec. 1)

Instructs a governing body, for tourism improvement area plan amendments that include
a new or increase lodging assessment, to hold a public hearing on the amendment and
provide a meeting notice to the owner of each lodging business subject to the lodging
business assessment. (Sec. 1)

. Stipulates the governing body must hold a public hearing on the amendment if the

amendment does not include a new or increased assessment. (Sec. 1)

Lodging Business Assessments

HB 2873

Initials PB Page 3 Commerce
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Requires the owner's association to establish, charge and collect lodging business
assessments on the lodging businesses located in the tourism improvement area. (Sec. 1)

Limits the assessments to $5 per room sold per night on the lodging business rooms in
the tourism improvement area and allows the assessment rate to be tiered based on the
annual average daily room rate for the affected lodging business. (Sec. 1)

Outlines the process for the lodging business owner in levying the assessments and
paying the assessments to the Department of Revenue (DOR). (Sec. 1)

Instructs DOR to report the amount of assessments collected to the State Treasurer. (Sec.
1)

Instructs the State Treasurer to transmit monthly the amount collected from lodging
business assessments within the tourism improvement area to the treasurer or officer
exercising the functions of treasurer of the municipality or county where the tourism
improvement area is located. (Sec. 1)

Instructs the owners! association and the participating governing body to report the
amount of the lodging business assessment to DOR and to supply DOR and the State
Treasurer any requested information. (Sec. 1)

Tourism Improvement Area Renewal and Dissolution

Allows a tourism improvement area to be renewed and engage in different tourism
improvement activities than the original tourism improvement area. (Sec. 1)

Specifies any remaining monies held by the tourism improvement area be transferred to
the renewed tourism improvement area. (Sec. 1)

Stipulates a 30-day period each year in which the lodging business owners may request
dissolution of the tourism improvement area. (Sec. 1)

Outlines the process for tourism improvement area dissolution, including petition
submission and holding a public hearing. (Sec. 1)

Allows the governing body to adopt a resolution dissolving the tourism improvement area
upon the area satisfying all debts of the tourism improvement area. (Sec. 1)

Stipulates the governing body may dissolve the tourism improvement area upon finding
that there has been misappropriation of monies, malfeasance or a violation of law in
connection with the management of the tourism improvement area. (Sec. 1)

Requires the resolution dissolving the tourism improvement area to:

a) state the reason for the dissolution;

b) state the time and date of the public hearing; and

c) contain a proposal to dispose of any assets acquired with the monies of the lodging
business assessments levied within the tourism improvement area. (Sec. 1)

Provides notice and public hearing requirements relating to the dissolution. (Sec. 1)

Requires remaining monies of the tourism improvement area to the spent in accordance
with the area plan or refunded to the appropriate lodging business owners. (Sec. 1)

Stipulates monies must be refunded using the same method and basis that was used to
calculate the assessments levied in the fiscal year in which the tourism improvement area
is dissolved or expires. (Sec. 1)

HB 2873

Initials PB Page 4 Commerce
Miscellaneous

52. Prohibits the governing body from eliminating or reducing the funding level of any
services customarily provided in the tourism improvement area boundaries. (Sec. 1)

53. Stipulates the governing body, unless a reduction in service is part of a municipality-wide
or county-wide pro rata reduction in services necessitated by fiscal considerations or
budgetary constraints, must continue to provide the customary funding and services
levels of each service within the tourism improvement area. (Sec. 1)

54. Defines pertinent terms. (Sec. 1)

55. Contain a legislative findings clause. (Sec. 2)

HB 2873
Initials PB Page 5 Commerce
Fifty-seventh Legislature Commerce
First Regular Session H.B. 2873

OON DOT HPWM HE

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2873
(Reference to printed bill)

Amendment instruction key:

CGREEN UNDERLINING IN BRACKETS] indicates text added to statute or

previously enacted session law.

[Green underlining in brackets] indicates text added to new session law

or text restoring existing law.

[LGREEN-STRIKEOUT-FHY-BRACKEFS] indicates new text removed from statute

or previously enacted session law.

[Green-strtkeout—itbrackets] indicates text removed from existing statute,
previously enacted session law or new session law.

<<Green carets>> indicate a section added to the bill.
<<@reen—strtkevut—r-carets>> indicates a section removed from the bill.

The bill as proposed to be amended is reprinted as follows:
Section 1. Title 48, Arizona Revised Statutes, is amended by adding
chapter 38, to read:
CHAPTER 38
TOURISM IMPROVEMENT AREA
ARTICLE 1. GENERAL PROVISIONS

48-6501. Definitions

IN THIS CHAPTER, UNLESS THE CONTEXT OTHERWISE REQUIRES:

1. "BOARD" MEANS THE BOARD OF SUPERVISORS OF THE COUNTY.

2. [™DESTINATION MARKETING ORGANIZATION" MEANS A NOT-FOR-PROFIT
ORGANIZATION OR GOVERNMENTAL UNIT THAT IS DESIGNATED BY THE GOVERNING BODY
AS BEING RESPONSIBLE FOR THE TOURISM PROMOTION AND MARKETING OF THE
MUNICIPALITY OR COUNTY.

3.] “GOVERNING BODY" MEANS THE GOVERNING BODY OR BOARD THAT BY LAW
IS CONSTITUTED AS THE LEGISLATIVE DEPARTMENT OF THE MUNICIPALITY OR
COUNTY.

[37] [4.] “LODGING BUSINESS" MEANS ANY BUSINESS PROVIDING
TRANSIENT LODGING.

[47] [5.] "LODGING BUSINESS ASSESSMENT" MEANS A LEVY ON NIGHTLY
ROOM RENTALS.

[S57] [6.] “LODGING BUSINESS OWNER" MEANS A PERSON RECOGNIZED AS
THE OWNER OF A LODGING BUSINESS THAT IS SUBJECT TO A LODGING BUSINESS
ASSESSMENT.

(6>] [Z.] "MUNICIPALITY" MEANS A CITY OR TOWN.

[77] [8.] “OWNERS' [ASSOETATTON] [BOARD]" MEANS [AN—HYCORPORATED
NONPROFIA— BR GOVERNMENT ONE THAT SERVES AS —_TFHEL8 CAL BEST ANATFEON
MARKETING— ORGANIZATION] [IHE DESIGNATED INDIVIDUALS THAT GOVERN THE
ACTIVITIES OF THE TOURISM IMPROVEMENT AREA. THE OWNERS’ BOARD MAY BE THE

WVithd! ‘awn

Analysts

House Amendments to H.B. 2873

WOON DON HPWMH

3. THE PLANNED TOURISM IMPROVEMENT AREA ACTIVITIES OF THE PROPOSED
TOURISM IMPROVEMENT AREA AND AN ESTIMATE OF THE [ANNUAL] COST OF THE
PLANNED TOURISM IMPROVEMENT AREA ACTIVITIES.

4. A DEFINITION DESCRIBING THE TYPE OR CLASS OF LODGING BUSINESSES
TO BE INCLUDED IN THE PROPOSED TOURISM IMPROVEMENT AREA AND THE LODGING
BUSINESSES THAT WILL BE SUBJECT TO THE PROPOSED TOURISM IMPROVEMENT AREA
LODGING BUSINESS ASSESSMENT. THE DEFINITION MAY INCLUDE THE SIZE OF THE
LODGING PROPERTY OR NUMBER OF ROOMS AT THE LODGING PROPERTY.

5. THE PROPOSED SOURCE [6R—S6UREES] OF FINANCING, INCLUDING THE
PROPOSED METHOD AND BASIS OF LEVYING THE LODGING BUSINESS ASSESSMENT IN
SUFFICIENT DETAIL TO ALLOW EACH LODGING BUSINESS OWNER TO ESTIMATE THE
AMOUNT OF THE LODGING BUSINESS ASSESSMENT TO BE LEVIED AGAINST THE LODGING
BUSINESS.

6. THE ESTIMATED TOTAL PROPOSED TOURISM IMPROVEMENT AREA LODGING
BUSINESS ASSESSMENTS TO BE EXPENDED FOR TOURISM IMPROVEMENT AREA
ACTIVITIES DURING THE FIRST YEAR OF OPERATION OF THE PROPOSED TOURISM
IMPROVEMENT AREA AND THE FORMULA USED TO DETERMINE EACH OWNER'S LODGING
BUSINESS ASSESSMENT, WHICH SHALL BE BASED ON BENEFIT.

7. THE TIME AND MANNER OF COLLECTING THE LODGING BUSINESS
ASSESSMENTS AND ANY INTEREST OR PENALTIES THAT MAY BE ASSESSED FOR
NONPAYMENT.

8. THE TERM OF THE PROPOSED TOURISM IMPROVEMENT AREA.

[9-—TFRE-NAME—OF-THE-PROPOSEB—OHNERS*ASSOCTATFTONT

JB. LODGING BUSINESS ASSESSMENTS LEVIED FOR THE PURPOSE OF
CONDUCTING TOURISM IMPROVEMENT AREA ACTIVITIES WILL PROVIDE BENEFITS TO
LODGING BUSINESSES [AND ASSOCIATED INDUSTRIES] LOCATED WITHIN THE TOURISM
IMPROVEMENT AREA THAT ARE SUBJECT TO THE LODGING BUSINESS
ASSESSMENT. LODGING BUSINESS ASSESSMENTS MAY VARY BY TYPES OR CLASSES OF
LODGING BUSINESSES AS DESCRIBED IN THE TOURISM IMPROVEMENT AREA PLAN,
INCLUDING THE SIZE OF THE LODGING PROPERTY OR NUMBER OF ROOMS AT THE
LODGING PROPERTY. A LODGING BUSINESS ASSESSMENT MAY BE LEVIED BASED ON
ANY OF THE FOLLOWING:

1. A FIXED AMOUNT.

2. RATE PER TRANSACTION.

3. FIXED RATE PER TRANSACTION PER DAY.

4. PERCENTAGE OF SALES.

5. ANY COMBINATION OF THE METHODS LISTED IN THIS SUBSECTION OR ANY
OTHER METHOD THAT CONFERS BENEFIT TO THE PAYOR.

C. THE VALIDITY OF A LODGING BUSINESS ASSESSMENT LEVIED BY A FORMED
TOURISM IMPROVEMENT AREA MAY NOT BE CONTESTED IN AN ACTION OR PROCEEDING
UNLESS THE ACTION OR PROCEEDING IS COMMENCED WITHIN THIRTY DAYS AFTER THE
RESOLUTION LEVYING THE LODGING BUSINESS ASSESSMENT IS ADOPTED. AN APPEAL
FROM A FINAL JUDGMENT IN AN ACTION OR PROCEEDING CONTESTING THE VALIDITY
OF A LODGING BUSINESS ASSESSMENT SHALL BE PERFECTED WITHIN THIRTY DAYS
AFTER THE ENTRY OF JUDGMENT.

D. TOURISM IMPROVEMENT AREA ACTIVITIES SHALL BE DESIGNED TO PROMOTE
TOURISM AND LODGING TO ENHANCE THE ECONOMIC DEVELOPMENT CLIMATE IN THE

House Amendments to H.B. 2873

Cfv] (CE.J THE GOVERNING BODY OF A MUNICIPALITY MAY NOT FORM A
PROPOSED TOURISM IMPROVEMENT AREA WITHIN THE UNINCORPORATED TERRITORY OF A
COUNTY WITHOUT THE CONSENT OF THE BOARD OF SUPERVISORS OF THAT
COUNTY. THE GOVERNING BODY OF A MUNICIPALITY MAY NOT FORM A _ PROPOSED
TOURISM IMPROVEMENT AREA WITHIN THE TERRITORIAL JURISDICTION OF ANOTHER
MUNICIPALITY WITHOUT THE CONSENT OF THE GOVERNING BODY OF THE OTHER
MUNICIPALITY. THE BOARD OF SUPERVISORS MAY NOT FORM A PROPOSED TOURISM
IMPROVEMENT AREA WITHIN THE TERRITORIAL JURISDICTION OF ANOTHER COUNTY
WITHOUT CONSENT OF THE BOARD OF SUPERVISORS OF THE OTHER COUNTY.

[#>] [E.] THE INITIAL TERM OF A FORMED TOURISM IMPROVEMENT AREA
MAY NOT EXCEED TEN YEARS AND SUBSEQUENT RENEWALS OF THE TOURISM
IMPROVEMENT AREA MAY NOT EXCEED TEN YEARS PER RENEWAL.

[i] [G.] ANY LODGING BUSINESS OF THE TYPES OR CLASSES THAT ARE
SUBJECT TO THE LODGING BUSINESS ASSESSMENT THAT COMMENCES OPERATIONS
DURING THE TOURISM IMPROVEMENT AREA'S TERM SHALL BE SUBJECT TO A TOURISM
IMPROVEMENT AREA LODGING BUSINESS ASSESSMENT.

48-6505. Management: annual report

A. EACH TOURISM IMPROVEMENT AREA SHALL BE [iMANAGEB] [GOVERNED] BY
AN OWNERS' [ASSOE€HATEON] [BOARD COMPOSED OF A MAJORITY OF THE LODGING
BUSINESS OWNERS LOCATED WITHIN THE TOURISM IMPROVEMENT AREA OR THEIR
AUTHORIZED REPRESENTATIVES. A REPRESENTATIVE OF THE MUNICIPALITY OR
COUNTY MAY HAVE A NONVOTING, EX OFFICIO SEAT ON THE GOVERNING BOARD].

[B.] THE GOVERNING BODY SHALL CONTRACT WITH [HE—TOURTSM
FMPROVEMENT— AREA OHINERS*—_ASSOETATION] [ITS DESTINATION MARKETING
ORGANIZATION] TO [CABMENTSTER] [MANAGE AND IMPLEMENT] THE TOURISM
IMPROVEMENT AREA ACTIVITIES SPECIFIED IN THE TOURISM IMPROVEMENT AREA

PLAN.
[BT ATHEWET—FORMEBNONPROF FA EO RP ORATION TS BESTENATEB- AS THE

House Amendments to H.B. 2873

WOON DTP WDM E

28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47

A. THE [OWNER*S—ASSOCTATEON] [DESTINATION MARKETING ORGANIZATION

MANAGING THE TOURISM IMPROVEMENT AREA] SHALL ESTABLISH, CHARGE AND COLLECT
LODGING BUSINESS ASSESSMENTS ON THE LODGING BUSINESSES LOCATED WITHIN THE

TOURISM IMPROVEMENT AREA. THE [OWNERS*——ASSOECTATTON] [DESTINATION
KET IZATI MANAGI THE TOURISM IMPROVEMENT AREA] MAY LEVY A
LODGING BUSINESS ASSESSMENT OF NOT MORE THAN $5 [OR FIVE PERCENT] PER ROOM
SOLD PER NIGHT ON THE LODGING BUSINESS ROOMS IN THE TOURISM IMPROVEMENT
AREA. THE LODGING BUSINESS ASSESSMENT RATE OR RATES MAY BE TIERED BASED
ON THE ANNUAL AVERAGE DAILY ROOM RATE FOR THE AFFECTED LODGING BUSINESS.

B. THE LODGING BUSINESS OWNER OR AUTHORIZED REPRESENTATIVE SHALL
PAY THE LODGING BUSINESS ASSESSMENT TO THE DEPARTMENT OF REVENUE AT THE
SAME TIME AS PAYING THE TRANSACTION PRIVILEGE TAX REQUIRED PURSUANT TO
SECTION 42-5014. THE LODGING BUSINESS ASSESSMENT SHALL BE LEVIED
BEGINNING ON THE FIRST DAY OF THE FIRST MONTH NINETY DAYS AFTER THE
OWNERS' ASSOCIATION IS ESTABLISHED. UNLESS THE CONTEXT OTHERWISE
REQUIRES, THE ADMINISTRATION OF THE LODGING BUSINESS ASSESSMENT SHALL BE
SUBJECT TO SECTION 42-6102. IF THE LODGING BUSINESS OWNER DOES NOT PAY
TRANSACTION PRIVILEGE TAX, THE LODGING BUSINESS ASSESSMENT IS DUE AND
PAYABLE TO THE DEPARTMENT OF REVENUE AS REQUIRED BY SECTION 42-5014. THE
DEPARTMENT SHALL REPORT TO THE STATE TREASURER THE AMOUNT OF LODGING
BUSINESS ASSESSMENTS COLLECTED PURSUANT TO THIS SECTION.

C. THE STATE TREASURER SHALL TRANSMIT TO THE TREASURER OR OFFICER
EXERCISING THE FUNCTIONS OF TREASURER OF THE MUNICIPALITY OR COUNTY WHERE
THE TOURISM IMPROVEMENT AREA IS LOCATED ON A MONTHLY BASIS THE AMOUNT
COLLECTED FROM LODGING BUSINESS ASSESSMENTS WITHIN THE TOURISM IMPROVEMENT

AREA.
D. THE [OWNERS*—ASSOCTATTON] [DESTINATION MARKETING ORGANIZATION

MANAGING THE TOURISM IMPROVEMENT AREA] AND THE GOVERNING BODY THAT IS
PARTICIPATING IN THE TOURISM IMPROVEMENT AREA SHALL REPORT TO THE

DEPARTMENT OF REVENUE THE AMOUNT OF THE LODGING BUSINESS ASSESSMENT AND
SUPPLY THE DEPARTMENT OF REVENUE AND THE STATE TREASURER WITH ALL
REQUESTED INFORMATION NECESSARY TO ADMINISTER THIS SECTION.

48-6508. Renewal: dissolution: remaining revenue

A. AN ESTABLISHED TOURISM IMPROVEMENT AREA MAY BE RENEWED FOR A NEW
TERM. A RENEWED TOURISM IMPROVEMENT AREA MAY ENGAGE IN DIFFERENT TOURISM
IMPROVEMENT ACTIVITIES THAN THE ORIGINAL TOURISM IMPROVEMENT AREA. ON
RENEWAL OF A TOURISM IMPROVEMENT AREA, ANY REMAINING MONIES HELD BY THE
TOURISM IMPROVEMENT AREA SHALL BE TRANSFERRED TO THE RENEWED TOURISM
IMPROVEMENT AREA.

B. DURING THE TERM OF THE TOURISM IMPROVEMENT AREA, THERE SHALL BE
A THIRTY-DAY PERIOD EACH YEAR IN WHICH LODGING BUSINESS OWNERS WHO HAVE
PAID LODGING BUSINESS ASSESSMENTS MAY REQUEST DISSOLUTION OF THE TOURISM
IMPROVEMENT AREA. THE INITIAL THIRTY-DAY PERIOD SHALL BEGIN ONE YEAR
AFTER THE DATE OF ESTABLISHMENT OF THE TOURISM IMPROVEMENT AREA. ON
RECEIPT OF A PETITION SUBMITTED BY THE LODGING BUSINESS OWNERS’ THAT
REPRESENT FIFTY PERCENT OR MORE OF THE TOTAL ROOMS WITHIN THE TOURISM
IMPROVEMENT AREA, THE GOVERNING BODY SHALL PASS A RESOLUTION OF INTENTION

House Amendments to H.B. 2873

OnNOOHPWDM FE

1. Many tourism and lodging businesses located and operating in
municipal and county communities in this state struggle to compete with
destinations in other states in attracting overnight visitation due to
inadequate services and activities.

2. Tourism improvement areas will help municipalities within this
state to grow leisure, convention and event visitor demand by promoting
tourism, business activities, economic growth and employment within this
state.

3. Because additional services and activities will provide direct
benefits to the lodging businesses within a tourism improvement area, the
most equitable method of financing tourism improvement area activities is
to levy a lodging business assessment on lodging businesses that will
benefit from a tourism improvement area.

4. Tourism and lodging demand generated by a tourism improvement
area will increase revenue for this state.

5. Tourism lodging business owners should be encouraged to create a
tourism improvement area to enhance the local tourism business climate.

18 6. Tourism improvement area activities are intended to supplement
19 and not replace existing governmental activities and services.

20 Enroll and engross to conform

21 Amend title to conform

JEFF WENINGER

2873WENINGER2. docx
02/17/2025

11:06 AM

H: LG@/ra

ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2873

DATE February 18, 2025 motion: DPA
PASS AYE NAY PRESENT | ABSENT

Aguilar od

Blackman ef

Cavero ae

Connolly Td

Diaz Y

Hendrix iW

Villegas * é

Wilmeth

Way, Vice-Chairman - oi”

Weninger, Chairman yf
APPROVED: COMMITTEE SEC Y

Soft / rn —~

™ JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT ©

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2741: liquor sampling; reporting; requirements.
Sponsor: Representative Lopez, LD 16
Committee on Commerce

Overview
Allows a beer and wine store or liquor store to use any reasonable means for maintaining

records and reports.

History
The Department of Liquor Licenses and Control (DLLC) regulates the manufacture,

distribution and sale of liquor in Arizona through the issuance of a series of licenses and
investigating licensee compliance with liquor laws. Certain liquor licenses have on-sale retail
privileges allowing a customer to purchase and consume liquor on the licensed premises.

A liquor store licensee or a beer and wine store licensee may apply for sampling privileges
associated with the license. A license with sampling privileges allows the licensee to provide
spirituous liquor sampling subject to the following requirements:

1. any open product must be kept locked by the licensee when the sampling area is not
staffed;

2. the licensee is otherwise subject to all other statutory requirements and is liable for any
violation committed in connection with the sampling;

3. the licensed retailer must make sales of sampled products from the licensed retail
premises;

4, the licensee is prohibited from charging any customer for the sampling of any products,
except that the licensee may charge a fee for bona fide educational classes conducted in a
classroom by an instructor on the licensed premises where the sampling of any spirituous
liquor product is incidental to the course taught and to the course materials presented;

5. the sampling must be conducted under the supervision of an employee of a sponsoring
distiller, vintner, brewer, wholesaler or retail licensee;

6. accurate records of sampling products dispensed must be retained by the licensee;

7. sampling must be limited to three ounces of beer or cooler-type products, one and one-
half ounces of wine and one ounce of distilled spirits per person, per brand, per day; and

8. the sampling must be conducted only on the licensed premises (A.R.S. § 4-206.01).

Provisions

1. Prohibits DLLC from requiring a beer and wine store or liquor store licensee who have
sampling privileges to use a singular, department-maintained system for maintaining
required records and reports. (Sec. 1)

2. Requires a beer and wine store or liquor store to report scheduled samplings to DLLC
once every two weeks. (Sec. 1)

DO Prop 105 (45 votes) C1 Prop 108 (40 votes) 0 Emergency (40 votes) UO Fiscal Note

HB 2741
Initials Page 1 Commerce

ATT AGHMENT 2 |
3. Allows a beer and wine store or liquor store to use any reasonable means:
a) for maintaining the required records and reports; and
b) to report scheduled samplings. (Sec. 1)

4. Deletes archaic language. (Sec. 1)

HB 2741
Initials Page 2 Commerce
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE
COMMITTEE ON Commerce BILL NO. HB 2741
DATE February 18, 2025 MOTION: D Pp
PASS AYE NAY PRESENT | ABSENT

Aguilar al

Blackman v4

Cavero VA

Connolly LZ

Diaz wv

Hendrix il
Villegas a

Wilmeth AW

Way, Vice-Chairman af
Weninger, Chairman fi

APPROVED: COMMIT ECRETARY

saa

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT. 2.2.

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2905: craft producer; festival; fair; license
Sponsor: Representative Weninger, LD 138
Committee on Commerce

Overview
Creates a craft producer festival license. Repeals the wine, craft distillery and microbrewery

festival licenses.

History
The Department of Liquor Licenses and Control (DLLC), which consists of the State Liquor

Board and the Office of the Director of DLLC (Director), regulates the manufacture,
distribution and sale of liquor in Arizona through the issuance of a series of licenses and
investigating licensee compliance with liquor laws.

DLLC may issue a microbrewery license to any microbrewery that meets the statutory
requirements. A microbrewery must produce or manufacture at least 5,000 gallons and fewer
than 6,200,000 gallons of beer in a calendar year to maintain a microbrewery license. A
microbrewery may: 1) sell beer produced or manufactured on the premises for consumption
on or off the premises; 2) make sales and deliveries of beer that the microbrewery produces
or manufactures to persons licensed to sell beer in Arizona through wholesalers licensed in
Arizona or to persons licensed to sell beer in another state, if lawful; and 3) sell beer produced
or manufactured by other microbreweries for consumption only on the licensee's premises
(A.R.S. § 4-205.08).

DLLC may issue a farm winery license to a person who produces at least 200 gallons and
fewer than 40,000 gallons of wine in a calendar year. A licensed farm winery may: 1) make
sales and deliveries of wine to wholesalers licensed to sell wine; 2) serve wine produced or
manufactured on the premises for the purpose of sampling the wine; 3) sell to a consumer
physically present on the premises wine produced or manufactured on the premises in the
original container for consumption on or off the premises; and 4) allow a representative of the
licensed farm winery may consume small amounts of the products of the licensed farm winery
on the premises for the purpose of sampling the wine (A.R.S. § 4-205.04).

DLLC may issue a craft distiller license allowing a person to sale distilled spirits if the person
produces or manufactures no more than 20,000 gallons of distilled spirits. A craft distiller
may make sales and deliveries of distilled spirits subject to outlined criteria, including: 1)
make sales and deliveries of distilled spirits to wholesalers that are licensed to sell distilled
spirits; 2) serve distilled spirits that are produced or manufactured on the premises for the
purpose of consumption on the premises and may charge for samples on the premises of the
craft distiller; and 8) sell distilled spirits that are produced or manufactured on the premises
in the original container for consumption off the premises to a consumer who is physically
present on the premises (A.R.S. § 4-205.10).

0 Prop 105 (45 votes) 1 Prop 108 (40 votes) 0 Emergency (40 votes) O Fiscal Note

HB 2905
Initials PB Page 1 Commerce

ATTACHMENT 23
Provisions

li

10.

11.

12.

13.

Allows the Director to issue, on a temporary basis, a craft producer festival license,

authorizing:

a) sampling of the craft producer products on the craft producer festival premises; and

b) the sale of craft producer products for consumption on or off the festival premises.
(Sec. 3)

Provides approval requirements for a craft producer festival license for festivals that
occur at an otherwise unlicensed location or at a location that is not fully within the
licensee's existing licensed premises. (Sec. 3)

Requires denial of a craft producer festival license be forwarded to the Director within 60
days after the submission of a license application unless the applicant has requested more
time for consideration of the application. (Sec. 3)

Specifies that the approval process for licensure for festivals that occur at an unlicensed
location does not apply to physical locations that are fully within a licensed premises.
(Sec. 3)

Allows a representative of the licensed craft producer to consume small amounts of the

products of the producer on the festival premises for the purpose of quality control. (Sec.

3)

Authorizes the Director to:

a) issue one or more craft producer festival licenses for each licensed craft producer, for
a total of up to 150 days for each craft producer;

b) establish a fee for each day of each event for a craft producer festival or fair license;

and
c) issue a craft producer fair license with the permission of state or county fair

organizers. (Sec. 3)

Permits a craft producer, at any sanctioned state or county fair, to allow:
a) sampling of craft producer products on the fair premises;
b) the sale of the products for consumption on or off the fair premises. (Sec. 3)

Exempts craft producer licenses from certain licensing requirements. (Sec. 3)

Allows the Director to issue a special event license concurrently with a craft producer
festival license. (Sec. 1)

Reduces, from 5,000 gallons to 1,000 gallons, the minimum required amount of beer that
must be annually produced or manufactured for a microbrewery license. (Sec. 4)

Exempts craft producer festival or fair licenses from the statutory restrictions on licensing
premises that are within 300 feet of a public or private school building, or a fenced
recreational area adjacent to the public or private school building. (Sec. 6)

Repeals statute relating to farm winery festival license, craft distillery festival license
and microbrewery festival license. (Sec. 2, 5)

Makes conforming changes. (Sec. 1, 6)

HB 2905

Initials PB Page 2 Commerce
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILLNO. — HB 2905
DATE February 18, 2025 MOTION: DP

PASS AYE NAY PRESENT | ABSENT
Aguilar ral
Blackman a
Cavero -
Connolly if
Diaz VA
Hendrix Ta
Villegas ~
Wilmeth Fe
Way, Vice-Chairman A
Weninger, Chairman

frexy—

APPROVED:

\ fpr —

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ere) ITTEE SECRETARY

ATTACHMENT. 24

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2906: financial technology; digital assets program
Sponsor: Representative Weninger, LD 13
Committee on Commerce

Overview
Renames the Regulatory Sandbox Program (Program) to the Financial Technology, Digital
Assets and Blockchain Sandbox Program.

History
The Attorney General (AG) administers and oversees the Program, which enables persons to

obtain limited access to Arizona's market to test innovative financial products or services or
other innovations without obtaining a license or other authorization. An innovation is the use
or incorporation of new or emerging technology or the reimagination of uses for existing
technology to address a problem, provide a benefit or otherwise offer a product, service,
business model or delivery mechanism that is not known by the AG to have a comparable
widespread offering in Arizona.

An applicant for the Program must demonstrate to the AG adequate understanding of the
innovation and a sufficient plan to test, monitor and assess the innovation while ensuring
consumers are protected from a test's failure. Upon application approval, an applicant is
deemed a Program participant and given 24 months to test the innovation. Statute outlines
testing restrictions, including limiting the number of consumers that may test the innovation.

The Program participant must retain records, documents and data produced in the ordinary
course of business. If an innovation fails before the end of the testing period, the participant
must notify the AG and report on actions taken to ensure consumers have not been harmed
because of the innovation's failure. At least 30 days before the 24-month testing period ends,
the participant must notify the AG that the participant will exit the Program and cease
offering any innovative products or services within 60 days after the 24-month testing period
ends or seek an extension in order to pursue a license or other authorization required by law
(Title 41, Chapter 55, A.R.S.).

Provisions
1. Renames the "Regulatory Sandbox Program" to the "Financial Technology, Digital Assets

and Blockchain Sandbox Program" (Sec. 4)

2. Defines digital asset and financial technology, digital assets and blockchain sandbox. (Sec.
3)

Removes the definition for regulatory sandbox. (Sec. 3)

Makes conforming changes. (Sec. 1-12)

0 Prop 105 (45 votes) OC Prop 108 (40 votes) 0 Emergency (40 votes) UO Fiscal Note

HB 2906
Initials PB Page 1 Commerce

ATTACHMENT 2.S
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON

Commerce BILL NO. HB 2906

DATE February 18, 2025

MOTION: D e

PASS

AYE NAY PRESENT | ABSENT

Aguilar

Blackman

Cavero

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

"Win

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

T ANIA) AKA

O|oa /
Maly, Alyey —
COMMYTTEE SECRE WARY

ATTACHMENT.

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2869: municipal development; independent provider review
Sponsor: Representative Way, LD 15
Committee on Commerce

Overview
Provides a process for municipal approval of an application and issuance for a building
permit.

History
Municipalities, in order to conserve and promote the public health, safety and general

welfare, may adopt zoning ordinances that: 1) regulate the use of buildings, structures and
land between agriculture residence, industry and business; 2) regulate the location, height,
bulk, number of stories and size of buildings and structures, the size and use of lots, yards,
courts and other open spaces, the percentage of a lot that may be occupied by a building or
structure, access to incident solar energy and the intensity of land use; 3) establish
requirements for off-street parking and loading; 4) establish and maintain building setback
lines; and 5) establish floodplain and age-specific community zoning districts and districts of
historical significance (A.R.S. § 9-462.01).

Provisions

1. Allows an applicant to contract with, and provide payment directly to, an independent
provider, for whom the applicant has no financial interest in, to review an application or
provide a building inspection. (Sec. 1)

2. Prevents the independent provider from providing legal counsel to the applicant. (Sec. 1)

3. Outlines specified information that an applicant must provide to the municipality prior
to an independent provider performs a review or inspection. (Sec. 1)

4. Stipulates the municipality must reduce the fee charged for a review or inspection by an
amount equal to what the municipality saves by not performing a review or inspection if
the applicant retains an independent provider to perform such review or inspection. (Sec.

1)

5. Requires an independent provider to maintain professional liability insurance covering
services performed unless the insurance requirement is waived by the municipality. (Sec.
1)

6. Specifies the insurance coverage must have a minimum policy limit of:
a) $2,000,000 per occurrence and $4,000,000 in the aggregate for projects with
construction cost of $5,000,000 or less; and
b) $4,000,000 per occurrence and $8,000,000 in the aggregate for projects with
construction cost of more than $5,000,000. (Sec. 1)

O Prop 105 (45 votes) 0 Prop 108 (40 votes) 0 Emergency (40 votes) UO Fiscal Note

HB 2869
Initials PB Page 1 Commerce

ATTACHMENT 2]
10.

11,

12.

13.

14.

15.

16.

17.

18.

19.
20.
21.
22.

Stipulates a municipality must provide an independent provider or applicant equal access
to all relevant documents that would be provided to municipal personnel in completing a
review or performing an inspection. (Sec. 1)

Requires, for access that is provided by software that protects exempt records, the
municipality to provide requested permitting or inspection documents and reports to the
independent provider or the applicant on receipt of an electronically submitted request.
(Sec. 1)

Requires an independent provider in reviewing an application to determine compliance
with all applicable municipality requirements. (Sec. 1)

Requires an independent provider, on determining application compliance, to submit an
affidavit to the municipality certifying application reviewal and conformity with
municipality requirements. (Sec. 1)

Instructs the municipality to either approve the application or provide a written notice
identifying the portions of the application that are not in compliance with applicable
municipal codes within five business days after receipt of a reviewed application and
required affidavit. (Sec. 1)

Deems the application approved and any necessary permits be issued if the municipality
neither approves nor provides the required written notice. (Sec. 1)

Stipulates, for applicants that resubmit a revised application, the regulatory authority
has what remains of the initial five-day review time frame plus one business day to
approve the application and issue the requested building permit or provide a second
written notice identifying which portions remain in noncompliance. (Sec. 1)

Deems the resubmitted application approved and any necessary permits be issued if the
municipality neither approves the application nor provides a second required written
notice within 5 days after resubmittal. (Sec. 1)

Stipulates any decision regarding the issuance of an application by a regulatory authority
is appealable to the planning and development board which must adjudicate the dispute.
(Sec. 1)

Precludes a municipality from adopting or enforcing any laws, rules, policies or standards
regarding an independent provider's review of an application or performance of a building
inspection that are more restrictive as provided. (Sec. 1)

Affirms the municipality's ability to issue a stop-work order for a building project if
determined that a condition on the building site constitutes an immediate threat to public
safety and health. (Sec. 1)

Authorizes an applicate to institute a civil proceeding seeking a determination and
issuance of appropriate permits or certificates if the applicant believes the municipality
has committed outlined acts. (Sec. 1)

Defines applicant, application and independent provider. (Sec. 1)
Contains a delayed effective date of January 1, 2026. (Sec. 2)
Contains a severability clause. (Sec. 3)

Cites this act as the " Speeding Development Act." (Sec. 4)

HB 2869

Initials PB Page 2 Commerce
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE
COMMITTEE ON Commerce BILL NO. HB 2869
DATE February 18, 2025 MOTION: D P
PASS AYE NAY PRESENT | ABSENT

Aguilar ef
Blackman ”
Cavero ua

Connolly Y

Diaz

Hendrix

Villegas

Wilmeth

Weninger, Chairman

4
VA
VA
Way, Vice-Chairman we
Cal
6

APPROVED:
We

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT. Z &

—<— <<
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2328: technical correction; liquor licenses
S/E: fantasy sports contests
Sponsor: Representative Weninger, LD 13
Committee on Commerce

Summary of the Strike Everything Amendment to HB 2328

Overview
Clarifies what constitutes as a fantasy sports contest.

History
Laws 2021, Chapter 234, established laws regulating fantasy sports betting and event

wagering, including licensing requirements for fantasy sports contests and event wagering
operators.

A person is required to be licensed as a fantasy sports contest operator in order to offer

fantasy sports contests in this state. An individual may offer one or more fantasy sports

contests if:

1) the fantasy sports contests are not made available to the general public;

2) each of the fantasy sports contests is limited to not more than fifteen total fantasy sports
contest players; and

3) the individual collects not more than $10,000 in total entry fees for all fantasy sports
contests offered in a calendar year, at least 95% of which are awarded to the fantasy
sports contest players.

Fantasy sports contest is a simulated game or contest that is offered to the public with an

entry fee and that meets all of the following conditions:

1) No fantasy sports contest team is composed of the entire roster of a real-world sports
team.

2) No fantasy sports contest team is composed entirely of individual athletes who are
members of the same real-world sports team.

3) Each prize or award or the value of all prizes or awards offered to winning fantasy sports
contest players is made known to the fantasy sports contest players in advance of the
fantasy sports contest.

4) Each winning outcome reflects the relative knowledge and skill of the fantasy sports
contest players and is determined by the aggregated statistical results of the performance
of multiple individual athletes or participants selected by the fantasy sports contest
player to form the fantasy sports contest team, whose individual performances in the
fantasy sports contest directly correspond with the actual performance of those athletes

0 Prop 105 (45 votes) O Prop 108 (40 votes) OO Emergency (40 votes) CO Fiscal Note

HB 2328
Initials PB Page 1 Commerce

ATTACHMENT 29
or participants in the athletic events in which those individual athletes or participants
participated.

5) A winning outcome is not based on randomized or historical events or on the score, point
spread or performance in an athletic event of a single real-world sports team, a single
athlete or any combination of real-world sports teams (A.R.S. § 5-1201).

Provisions
1. Specifies a fantasy sports contest conducted by an operator as defined in the fantasy
sports contest statutes does not constitute event wagering as defined in the event

wagering statutes. (Sec. 2)

2. Stipulates that the applicable conditions required to offer a fantasy sports contests apply
as conditions for offering a fantasy sports contests without a license. (Sec. 2)

Modifies the definition of fantasy sports contest. (Sec. 1)

4, Makes technical changes. (Sec. 2)

HB 2328
Initials PB Page 2 Commerce
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Fifty-seventh Legislature Commerce
First Regular Session H.B. 2328

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2328
(Reference to printed bill)

Strike everything after the enacting clause and insert:

"Section 1. Section 5-1201, Arizona Revised Statutes, is amended to
read:

5-1201. Definitions

In this chapter, unless the context otherwise requires:

1. "Applicant" means any person that has applied for a license as a
fantasy sports contest operator or that has been approved for any act
related to fantasy sports contests.

2. “Application” means a request to issue a license as a fantasy
sports contest operator or to approve any act related to fantasy sports
contests.

3. “Athletic event":

(a) Means a real-world professional, collegiate or nationally
recognized sports game, contest or competition that involves the physical
exertion and skill of the participating individual athletes who are each
physically present at the location in which the sports game, contest or
competition occurs, and the outcome of the sports game, contest or
competition is directly dependent on the performance of the participating
athletes.

(b) Includes events involving motor vehicles.

4. "Department" means the department of gaming.

> ATTACHMENT 30
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FPF OO ON DOT BP wWHYH FP CO wo DAN DO F&F WHY KF CO

House Amendments to H.B. 2328

5, “Entry fee" means cash or A cash equivalent that is paid by a
participant to a fantasy sports contest operator to participate in a
fantasy sports contest.

6. “Fantasy sports contest" means a simulated game or contest that
is offered to the public with an entry fee IN WHICH PARTICIPANTS COMPETE
AGAINST EACH OTHER OR A SINGLE PARTICIPANT COMPETES AGAINST A TARGET SCORE
SET BY THE OPERATOR and that meets all of the following conditions:

(a) No fantasy sports contest team is composed of the entire roster
of a real-world sports team.

(b) No fantasy sports contest team is composed entirely of
individual athletes who are members of the same real-world sports team.

(c) Each prize or award or the value of all prizes or awards offered
to winning fantasy sports contest players is made known to the fantasy
sports contest players in advance of the fantasy sports contest.

(d) Each winning outcome reflects the relative knowledge and skill
of the fantasy sports contest players and is determined by the aggregated
statistical results of the performance of multiple individual athletes or
participants selected by the fantasy sports contest player to form the
fantasy sports contest team, whose individual performances in the fantasy
sports contest directly correspond with the actual performance of those
athletes or participants in the athletic events in which those individual
athletes or participants participated.

(e) A winning outcome is not based on randomized or historical
events or on the score, point spread or performance in an athletic event of
a single real-world sports team, a single athlete or any combination of
real-world sports teams.

(f) The fantasy sports contest does not constitute or involve and is
not based on any of the following:

(i) Racing that involves animals.

(ii) A game or contest ordinarily offered by a horse track or casino

for money, credit or any representative of value, including any races,

-2-
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House Amendments to H.B. 2328

games or contests that involve horses or that are played with cards or
dice.

(iii) A slot machine or other mechanical, electromechanical or
electronic device, equipment or machine.

(iv) Poker, blackjack, faro, monte, keno, bingo, fan-tan,
twenty-one, seven and a half, klondike, craps, chuck-a-luck, Chinese
chuck-a-luck, wheel of fortune, chemin de fer, baccarat, pai gow, beat the
banker, panguingue, roulette or other banking or percentage games.

(v) Any other game or device that is authorized or that is not
authorized by this state.

(vi) A high school or youth sporting event or any event that is not

an athletic event.

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7. “Fantasy sports contest adjusted revenues" means the amount equal

to the total of all entry fees that a fantasy sports contest operator
collects from all fantasy sports contest players minus the total of all
sums paid out as prizes or awards to all fantasy sports contest players,
multiplied by the in-state percentage.

8. “Fantasy sports contest operator" or “operator" means a person
that is engaged in the business of professionally conducting paid fantasy
sports contests for cash or other prizes or awards for members of the
general public that requires cash or cash equivalent as an entry fee to be
paid by a member of the general public who participates in a paid fantasy
sports contest.

9. “Fantasy sports contest platform" means the hardware, software,
firmware, communications technology or other equipment, including operator
procedures implemented to allow player participation in digital or online
fantasy sports contests, and if supported, the corresponding equipment
related to the display of the outcomes, and other similar information
necessary to facilitate player participation in which a player is provided

-3-
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House Amendments to H.B. 2328

with the means to establish a player account and the fantasy sports contest
operator is provided with the means to review player accounts, suspend
fantasy sports contests, generate various financial transaction and account
reports, input outcomes for fantasy sports contests and set = any
configurable parameters.

10. "Fantasy sports contest player" or “player" means an individual
who participates in a fantasy sports contest offered by a fantasy sports
contest operator.

11. "Fantasy sports contest team" means the simulated team composed
of multiple individual athletes, each of whom is a member of a real-world
sports team that a fantasy sports contest player selects to compete in a
fantasy sports contest.

12. “Highly experienced player" means a fantasy sports contest
player who has done at least one of the following:

(a) Entered more than one thousand fantasy sports contests offered
by a single fantasy sports contest operator.

(b) Won more than three prizes or awards valued at $1,000 each or
more from a single fantasy sports contest operator.

13. “Holding company" means a corporation, firm, partnership,
limited partnership, limited liability company, trust or other form of
business organization that is not an individual and that directly or
indirectly does either of the following:

(a) Holds an ownership interest of ten percent or more, as
determined by the holding company's board, in a fantasy sports contest
operator.

(b) Holds voting rights with the power to vote ten percent or more
of the outstanding voting rights of a fantasy sports contest operator.

14. “In-state percentage" means, for each fantasy sports contest,
the percentage, rounded to the nearest tenth of a percent, equal to the
total entry fees collected from all in-state participants divided by the
total entry fees collected from all participants in the fantasy sports
contest, unless otherwise prescribed by the department.

-4-
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House Amendments to H.B. 2328

15. "Key employee" means an employee of a fantasy sports contest
operator who has the power to exercise significant influence over decisions
concerning the fantasy sports contest operator.

16. “License” means an approval that is issued by the department to
any person or entity to be involved in a fantasy sports operation.

17. “Management company" means a person retained by a fantasy sports
contest operator to manage a fantasy sports contest platform and provide
general administration and other operational services.

18. "Person" means an individual, partnership, corporation,
association, limited liability company, federally recognized Indian tribe
or other legal entity.

19. "Player account" means an account that is established by a
patron for the purpose of participating in fantasy sports contests,
including deposits, withdrawals, entry fees and payouts.

20. “Prize or award" means anything of value or any amount of cash
or cash equivalents.

21. “Protected information" means information related to playing
fantasy sports contests by a fantasy sports contest player that is not
readily available to the general public and that is obtained as a result of
a person's employment in relation to a fantasy sports contest.

22. "Script" means a list of commands that a fantasy SPORTS
contest-related computer program can execute and that is created by a
fantasy sports contest player or by a third party for a fantasy sports
contest player to automate processes on a fantasy sports contest platform.

Sec. 2. Section 5-1202, Arizona Revised Statutes, is amended to

read:

5-1202. Fantasy sports contests; exceptions; rules; licensure

A. Except as otherwise provided in this section, a person may not
offer fantasy sports contests in this state unless the person is licensed
by the department as a fantasy sports contest operator.

B. An individual may offer one or more fantasy sports contests
WITHOUT A LICENSE if all of the following apply:

digs
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House Amendments to H.B. 2328

1. The fantasy sports contests are not made available to the general
public.

2. ach of the fantasy sports contests is limited to not more than
fifteen total fantasy sports contest players.

3. The individual collects not more than $10,000 in total entry fees
for all fantasy sports contests offered in a calendar year, at least
ninety-five percent of which are awarded to the fantasy sports contest
players.

C. An Indian tribe that lawfully conducts class III gaming pursuant
to a tribal-state gaming compact with this state, directly or through a
third-party operator, may offer and conduct fantasy sports contests without
applying for or holding a license pursuant to this section if all
activities of the fantasy sports contest occur within the boundary of its
Indian lands and the Indian tribe complies with any regulations that are
included in the compact or its appendices regarding fantasy sports
contests.

D. To ensure the integrity of fantasy sports contests, the
department has jurisdiction over each person involved in conducting a
fantasy sports contest. The department may adopt rules related to
conducting fantasy sports contests, including rules prescribing penalties
for violating this chapter or any rules adopted under this chapter.

E. Every applicant for licensure shall submit a _ completed
application, along with any required information, to the department OF
GAMING. The department OF GAMING shall determine the form and content of
the application. Each application shall be accompanied by the applicant's
current photograph and the fee required by the department OF GAMING. The
applicant must also submit a full set of fingerprints to the department OF
GAMING for the purpose of obtaining a state and federal criminal records
check pursuant to section 41-1750 and Public Law 92-544. The department of
public safety may exchange this fingerprint data with the federal bureau of

investigation.
Oo On TD OO FP WO DY F

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House Amendments to H.B. 2328

F. The information required by the department shall include
documentation of all of the following:

1. The name of the applicant.

2. The location of the applicant's principal place of business.

3. The applicant's telephone number.

4. The applicant's social security number or, if applicable, the
applicant's federal tax identification number.

5. The name and address of each individual that holds a ten percent
or more ownership interest in the applicant or in shares of the applicant.

6. The applicant's criminal record, if any, or if the applicant is a
business entity, on request, any criminal record of an individual who is a
director, officer or key employee of, or any individual who has a ten
percent or more ownership interest in, the applicant.

7. Any ownership interest that a director, officer, key employee or
individual owner of ten percent or more of the applicant holds in a person
that is or was a fantasy sports contest operator or similar entity in any
jurisdiction.

8. An identification of any business, including, if applicable, the
state of incorporation or registration, in which an applicant, director,
officer, key employee or individual owner of ten percent or more of the
applicant;- has an equity interest of five percent or more.

9. Whether an applicant, director, officer, key employee or
individual owner of ten percent or more of the applicant has ever applied
for or been granted any license, registration or certificate issued by a
licensing authority in this state or any other jurisdiction for a gaming
activity.

10. Whether an applicant, director, officer, key employee or
individual owner of ten percent or more of the applicant has filed or been
served with a complaint or other notice filed by a public body regarding
the delinquency in payment of or dispute over filings concerning the

payment of any tax required under federal, state or local law, including

-7-
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F OC YO ON DD oO FP WO MY FP TD HO DON TD TO FP WO DY KF CO

House Amendments to H.B. 2328

the amount of tax, the type of tax, the taxing agency and the time periods
involved.

11. A description of any physical facility operated by the applicant
in this state, the employees who work at the facility and the nature of the
business conducted at the facility.

12. Information sufficient to show, as determined by the department,
that the applicant can meet the requirements of procedures submitted by the
applicant under section 5-1203 and under any rules adopted under this
chapter.

G. The department may require licensure of a holding company, a
management company or any other person it considers sufficiently connected
to the fantasy sports contest operator if that licensure is necessary to
preserve the integrity of fantasy sports contests and protect fantasy
sports contest players.

H. A license issued under this section is valid for two years. The
department shall renew a license biennially if the applicant demonstrates
continued eligibility for licensure under this chapter and pays the renewal
fee. Notwithstanding this subsection, the department may investigate a
licensee at any time the department determines it is necessary to ensure
that the licensee remains in compliance with this chapter and the rules
adopted pursuant to this chapter.

I. The department shall establish the initial license fee and the
license renewal fee. The department may assess investigative costs if the
cost of a licensure investigation exceeds the amount of the initial license
or renewal fee.

J. On receipt of a completed application and the required fee, the
department shall conduct the _ necessary background investigation to
determine if the applicant meets the qualifications for licensure. On
completion of the necessary background investigation, the department shall
either issue a license or deny the application. If the application for

licensure is denied, a statement setting forth the grounds for denial shall

-8-
an ao FSF WO MY Ff

House Amendments to H.B. 2328

be forwarded to the applicant together with all other documents relied on
by the department, to the extent allowed by law.

K. A FANTASY SPORTS CONTEST CONDUCTED BY AN OPERATOR DEFINED TERM
PURSUANT TO THIS CHAPTER DOES NOT CONSTITUTE EVENT WAGERING AS DEFINED IN
SECTION 5-1301."

Amend title to conform

JEFF WENINGER

2328WENINGER SE1.docx
02/14/2025
11:57 AM

H:

PB/1s
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2328

DATE February 18, 2025 MOTION: D PA S E

PASS AYE PRESENT | ABSENT

Aguilar

\
NINE

Blackman

Cavero

Connolly

Diaz

Hendrix

Villegas
Wilmeth
Way, Vice-Chairman

Weninger, Chairman

SINAN AK

4 O ©

uw iy COMMITTEE SECRETARY

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT.

ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2654: blockchain and cryptocurrency study committee
S/E: eryptocurrency and blockchain commission
Sponsor: Representative Weninger, LD 13
Committee on Commerce

Summary of the Strike Everything Amendment to HB 2564

Overview
Establishes the Cryptocurrency and Blockchain Commission (Commission).

History
Blockchain is a cryptographically secured distributed ledger that records transactions

chronologically, permanently and unalterably.

Blockchain technology is distributed ledger technology that uses a distributed, decentralized,
shared and replicated ledger, which may be public or private, permissioned or permissionless,
or driven by tokenized crypto economics or tokenless. The data on the ledger is protected with
cryptography, is immutable and auditable and provides an uncensored truth.

Statute provides that a signature that is secured through blockchain technology is considered
to be in an electronic form and to be an electronic signature. A record or contract that is
secured through blockchain technology is considered to be in an electronic form and to be an
electronic record (A.R.S. § 44-7061).

Provisions
1. Establishes the 19-member Commission and outlines the Commission membership. (Sec.

1)

2. Directs the Commission to:

a) advise on cryptocurrency and blockchain-related matters including policies, pilot
programs, and initiatives;

b) develop strategies and cryptocurrency and blockchain solutions to position Arizona as
a leader in blockchain innovation designed to improve transparency, increase
efficiency and enhance the delivery of services to Arizona residents;

c) partner with and facilitate collaboration with academic institutions, industry leaders,
innovators, firms, startups and the White House, with the aim of supporting
blockchain technologies and furthering cryptocurrency and blockchain adoption,
ensuring its integration in Arizona's economy;

d) promote cryptocurrency and blockchain literacy and workforce development within
educational institutions;

O Prop 105 (45 votes) 1 Prop 108 (40 votes) O Emergency (40 votes) UO Fiscal Note

HB 2654
Initials Page 1 Commerce

ATTACHMENT32
f)

g)

provide cryptocurrency and blockchain training programs for Arizona law
enforcement agencies to promote blockchain literacy and workforce development;
research, propose and help develop innovative, risk-averse and industry-supportive
cryptocurrency and blockchain legislation; and

meet on the call of its chairperson. (Sec. 1)

3. Instruct the Commission to appoint, from among its membership, the Arizona Crypto
Czar to help lead state cryptocurrency and blockchain initiatives and coordinate with
federal initiatives and outlines the duties of the Czar. (Sec. 1)

4. Authorizes the Commission to:

a)
b)
)
d)
e)
f)

g)

create subcommittees to address specific blockchain adoption and integration to
provide detailed and informed recommendations to the commission;

research and analyze topics within their designated focus areas to provide
recommendations;

collaborate with stakeholders to ensure alignment with state and federal blockchain
initiatives;

identify challenges and opportunities in blockchain adoption and propose actionable
solutions;

support the implementation of pilot programs, policies and educational initiatives
related to their designated focus areas;

provide progress updates and reports to the commission on their activities and
findings; and

work with national and international blockchain experts that provide strategic
guidance and expert recommendations to the Commission on blockchain trends,
technologies and best practices. (Sec. 1)

5. Allows the Commission to seek guidance from experts to:

a)
b)
c)

d)

evaluate proposed blockchain initiatives and pilot programs;

offer insights on emerging blockchain technologies and innovations;

facilitate connections with global blockchain leaders, organizations and research
institutions;

ensure that the Commission's strategies align with international standards and best
practices. (Sec. 1)

6. Requires the Commission to prepare a report detailing its activities and recommending
legislation on cryptocurrency and blockchain solutions to the Governor and Legislature
by December 1 of each year. (Sec. 1)

Initials

HB 2654
Page 2 Commerce
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Fifty-seventh Legislature Commerce
First Regular Session H.B. 2654

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2654
(Reference to printed bill)

Strike everything after the enacting clause and insert:
"Section 1. Title 18, chapter 7, article 1, Arizona Revised
Statutes, is amended by adding section 18-701, to read:

18-701. Arizona cryptocurrency and blockchain commission;

crypto czar; members; duties; reports

A. THE ARIZONA CRYPTOCURRENCY AND BLOCKCHAIN COMMISSION IS
ESTABLISHED TO:

1. ADVISE ON CRYPTOCURRENCY AND BLOCKCHAIN-RELATED MATTERS INCLUDING
POLICIES, PILOT PROGRAMS, AND INITIATIVES.

2. DEVELOP STRATEGIES AND CRYPTOCURRENCY AND BLOCKCHAIN SOLUTIONS TO
POSITION ARIZONA AS A LEADER IN BLOCKCHAIN INNOVATION DESIGNED TO IMPROVE
TRANSPARENCY, INCREASE EFFICIENCY AND ENHANCE THE DELIVERY OF SERVICES TO
ARIZONA RESIDENTS.

3. PARTNER WITH AND FACILITATE COLLABORATION WITH ACADEMIC
INSTITUTIONS, INDUSTRY LEADERS, INNOVATORS, FIRMS, STARTUPS AND THE WHITE
HOUSE, WITH THE AIM OF SUPPORTING BLOCKCHAIN TECHNOLOGIES AND FURTHERING
CRYPTOCURRENCY AND BLOCKCHAIN ADOPTION, ENSURING ITS INTEGRATION IN
ARIZONA'S ECONOMY.

4. PROMOTE CRYPTOCURRENCY AND BLOCKCHAIN LITERACY AND WORKFORCE
DEVELOPMENT WITHIN EDUCATIONAL INSTITUTIONS.

5, PROVIDE CRYPTOCURRENCY AND BLOCKCHAIN TRAINING PROGRAMS FOR
ARIZONA LAW ENFORCEMENT AGENCIES TO PROMOTE BLOCKCHAIN LITERACY AND
WORKFORCE DEVELOPMENT.

ATTACHMENT 23
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House Amendments to H.B. 2654

6. RESEARCH, PROPOSE AND HELP DEVELOP INNOVATIVE, RISK-AVERSE AND
INDUSTRY-SUPPORTIVE CRYPTOCURRENCY AND BLOCKCHAIN LEGISLATION.

B. THE COMMISSION IS ESTABLISHED CONSISTING OF THE FOLLOWING
MEMBERS:

1. THREE MEMBERS OF THE ARIZONA HOUSE OF REPRESENTATIVES WHO ARE
APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES, NOT MORE THAN TWO
OF WHOM ARE MEMBERS OF THE SAME POLITICAL PARTY. THE SPEAKER OF THE HOUSE
OF REPRESENTATIVES SHALL DESIGNATE ONE MEMBER TO SERVE AS CHAIRPERSON OF
THE COMMITTEE.

2. THREE MEMBERS OF THE ARIZONA SENATE WHO ARE APPOINTED BY THE
PRESIDENT OF THE SENATE, NOT MORE THAN TWO OF WHOM ARE MEMBERS OF THE SAME
POLITICAL PARTY.

3. A BLOCKCHAIN AND CRYPTOCURRENCY SPECIALIST WHO IS APPOINTED BY
THE SPEAKER OF THE HOUSE OF REPRESENTATIVES. THIS MEMBER WILL SERVE AS THE
DESIGNATED PERSON TO OVERSEE THE COMMISSION'S OPERATIONS, ENSURING OVERALL
EFFICIENCY AND ADHERENCE TO THE ESTABLISHED OBJECTIVES OF THE COMMITTEE.

4. A SENIOR MANAGING DIRECTOR OF A BLOCKCHAIN AND DIGITAL ASSETS
BUSINESS WHO IS APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES.
THIS MEMBER SHALL MANAGE THE FINANCIAL PLANNING, BUDGETING AND FUNDING
ALLOCATION FOR THE BLOCKCHAIN INITIATIVES.

5. A CHIEF TECHNOLOGY OFFICER OF AN ARIZONA-BASED CRYPTOCURRENCY
COMPANY WHO IS APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES.
THIS MEMBER SHALL DRIVE TECHNOLOGICAL INNOVATION AND PROVIDE UPDATES ON
CUTTING-EDGE BLOCKCHAIN SOLUTIONS TO SUPPORT THE COMMISSION'S DEVELOPMENT
AND ENSURE ALIGNMENT WITH THEIR OBJECTIVES.

6. A CHIEF MARKETING OFFICER OF AN ARIZONA-BASED CRYPTOCURRENCY
COMPANY WHO IS APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES.
THIS MEMBER SHALL HANDLE THE OUTREACH, PUBLIC RELATIONS AND MARKETING
STRATEGIES TO PROMOTE BLOCKCHAIN ADOPTION.

7. TWO REPRESENTATIVES OF AN ARIZONA BLOCKCHAIN OR CRYPTOCURRENCY
ASSOCIATION WHO ARE APPOINTED BY THE SPEAKER OF THE HOUSE OF
REPRESENTATIVES. THESE MEMBERS SHALL FOCUS ON IDENTIFYING EMERGING

-2-

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On FF OG oO DON DOF WHS FEF Ow DAN DO BRB wWNHY fF OO

House Amendments to H.B. 2654

BLOCKCHAIN TRENDS AND INTEGRATING INNOVATIVE PRACTICES INTO COMMISSION
INITIATIVES.

8. AN ATTORNEY WHO SPECIALIZES IN CRYPTOCURRENCY LITIGATION AND
PRACTICES IN THE STATE OF ARIZONA WHO APPOINTED BY THE SPEAKER OF THE HOUSE
OF REPRESENTATIVES.

9. AN EXPERIENCED CRYPTOCURRENCY REPRESENTATIVE WHO SPECIALIZES IN
PROVIDING CRYPTOCURRENCY CONSULTING SERVICES WHO IS APPOINTED BY THE
SPEAKER OF THE HOUSE OF REPRESENTATIVES.

10. A UNIVERSITY PROFESSOR WHO SPECIALIZES IN BLOCKCHAIN AND IS FROM
A UNIVERSITY UNDER THE JURISDICTION OF THE ARIZONA BOARD OF REGENTS WHO IS
APPOINTED BY THE SPEAKER OF THE HOUSE OF REPRESENTATIVES.

11. THE CHIEF EXECUTIVE OFFICER OF THE ARIZONA COMMERCE AUTHORITY OR
THE CHIEF EXECUTIVE OFFICER'S DESIGNEE.

12. THE DIRECTOR OF THE DEPARTMENT OF REVENUE OR THE DIRECTOR'S
DESIGNEE.

13. THE DIRECTOR OF THE DEPARTMENT OF INSURANCE AND FINANCIAL
INSTITUTIONS OR THE DIRECTOR'S DESIGNEE.

14. THE ATTORNEY GENERAL OR THE ATTORNEY GENERAL'S DESIGNEE.

C. THE COMMITTEE SHALL MEET ON THE CALL OF ITS CHAIRPERSON.

D. FROM AMONG ITS MEMBERSHIP, THE COMMISSION SHALL APPOINT THE
ARIZONA CRYPTO CZAR TO HELP LEAD STATE CRYPTOCURRENCY AND BLOCKCHAIN
INITIATIVES AND COORDINATE WITH FEDERAL INITIATIVES. THE CRYPTO CZAR SHALL:

1. ACT AS THE PRIMARY LIAISON BETWEEN ARIZONA AND FEDERAL
CRYPTOCURRENCY AND BLOCKCHAIN INITIATIVES.

2. ADVOCATE FOR CRYPTOCURRENCY AND BLOCKCHAIN ADOPTION IN ALIGNMENT
WITH STATE AND FEDERAL POLICIES.

3. COORDINATE CRYPTOCURRENCY AND BLOCKCHAIN PROJECTS AND PILOT
PROGRAMS WITHIN THE STATE.

4. SUBMIT UPDATES TO THE COMMISSION TO THE GOVERNOR AND LEGISLATURE
ON THE COMMISSION'S PROGRESS, INITIATIVES, AND OUTCOMES.

E. THE COMMISSION MAY CREATE SUBCOMMITTEES TO ADDRESS SPECIFIC
BLOCKCHAIN ADOPTION AND INTEGRATION TO PROVIDE DETAILED AND INFORMED

RECOMMENDATIONS TO THE COMMISSION AND MAY:
-3-

House Amendments to H.B. 2654

1 1. RESEARCH AND ANALYZE TOPICS WITHIN THEIR DESIGNATED FOCUS AREAS
2 TO PROVIDE RECOMMENDATIONS.

3 2. COLLABORATE WITH STAKEHOLDERS TO ENSURE ALIGNMENT WITH STATE AND
4 FEDERAL BLOCKCHAIN INITIATIVES.

5 3. IDENTIFY CHALLENGES AND OPPORTUNITIES IN BLOCKCHAIN ADOPTION AND
6 PROPOSE ACTIONABLE SOLUTIONS.

7 4. SUPPORT THE IMPLEMENTATION OF PILOT PROGRAMS, POLICIES AND
8 EDUCATIONAL INITIATIVES RELATED TO THEIR DESIGNATED FOCUS AREAS.

9 5. PROVIDE PROGRESS UPDATES AND REPORTS TO THE COMMISSION ON THEIR
10 ACTIVITIES AND FINDINGS.

ll F. THE COMMISSION MAY WORK WITH NATIONAL AND INTERNATIONAL
12 BLOCKCHAIN EXPERTS THAT PROVIDE STRATEGIC GUIDANCE AND EXPERT
13 RECOMMENDATIONS TO THE COMMISSION ON BLOCKCHAIN TRENDS, TECHNOLOGIES AND
14 GLOBAL BEST PRACTICES. THE COMMISSION MAY SEEK GUIDANCE FROM EXPERTS TO:

15 1. EVALUATE PROPOSED BLOCKCHAIN INITIATIVES AND PILOT PROGRAMS.

16 2. OFFER INSIGHTS ON EMERGING BLOCKCHAIN TECHNOLOGIES AND
17 INNOVATIONS.

18 3. FACILITATE CONNECTIONS WITH GLOBAL  BLOCKCHAIN LEADERS,
19 ORGANIZATIONS AND RESEARCH INSTITUTIONS.

20 4. ENSURE THAT THE COMMISSION'S STRATEGIES ALIGN WITH INTERNATIONAL
21 STANDARDS AND BEST PRACTICES.

22 G. THE COMMISSION SHALL PREPARE A REPORT TO THE GOVERNOR AND THE
23 LEGISLATURE BY DECEMBER 1 OF EACH YEAR DETAILING ITS ACTIVITIES AND
24 RECOMMENDING LEGISLATION ON CRYPTOCURRENCY AND BLOCKCHAIN SOLUTIONS."

25 Amend title to conform

JEFF WENINGER

02/14/2025
12:58 PM
H: LG@/ra

oe ON DD TO SB WH MP

NO ce oe
oD ON DO B® WH HH HF Oo

Fifty-seventh Legislature Commerce
First Regular Session H.B. 2654

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2654
(Reference to proposed WENINGER s/e amendment dated: 2/14/25; 12:58 pm)

Page 1, line 1, after the first comma, strike remainder of line
Strike line 2, insert “Arizona Revised Statutes, is amended by adding
chapter 7, to read:
CHAPTER 7
CRYPTOCURRENCY AND BLOCKCHAIN
ARTICLE 1. GENERAL PROVISIONS"
Page 4, between lines 24 and 25, insert:
"Sec. 2. Title 41, chapter 27, article 2, Arizona Revised Statutes,
is amended by adding section 41-3028.16, to read:

41-3028.16. Arizona cryptocurrency and blockchain commission:

termination July 1, 2028
A. THE ARIZONA CRYPTOCURRENCY AND BLOCKCHAIN COMMISSION TERMINATES

ON JULY 1, 2028.
B. TITLE 18, CHAPTER 7, ARTICLE 1 AND THIS SECTION ARE REPEALED ON

JANUARY 1, 2029.

Sec. 3. Purpose
Pursuant to section 41-2955, subsection E, Arizona Revised Statutes,

the legislature establishes the Arizona cryptocurrency and _ blockchain

commission to advise on cryptocurrency and blockchain-related matters.

Sec. 4. Emergency

ATTACHMENT 34
> WO MYO KF

House Amendments to H.B. 2654

This act is an emergency measure that is necessary to preserve the
public peace, health or safety and is operative immediately as provided by
law."

Amend title to conform

JEFF WENINGER

2654WENINGER. docx
02/17/2025

10:23 AM

H: PB/1s
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

COMMITTEE ON

ROLL CALL VOTE

Commerce

BILL NO. __HB 2654

DATE February 18, 2025

motion: NPA S/F

PASS

AYE

NAY PRESENT | ABSENT

Aguilar

Blackman

ae

Cavero

¥

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

SINAAAK A A

N

Weninger, Chairman

APPROVED:

MYM“

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

+O)

O O | |

COWMITTEE SEGRETARY

ATTACHMENT. 35
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2342: cell phone carrier; spam calls
S/E: blockchain technology; regulation; computational power
Sponsor: Representative Martinez, LD 16
Committee on Commerce

Summary of the Strike Everything Amendment to HB 2342

Overview
Preempts lawfully assessing or using computation power in a residence from city, town or
county regulations.

History
Current statute prohibits a city, town or county from impeding a person running a node on

blockchain technology in a residence. Additionally, declares that regulating the act of running
a node on blockchain technology in a person’s residence is of statewide concern and prohibits
further regulation by any city, town or county (A.R.S. §§ 9-500.42, 11-269.22),

Provisions
1. Precludes a city, town or county from restricting an individual from lawfully accessing or
using computational power in a residence. (Sec. 1, 2)

2. Asserts that regulating the act of lawfully accessing or using computational power in a
residence is of statewide concern and is not subject to further regulation from a city, town
or county. (Sec. 1, 2)

3. Defines computational power as the use of computer hardware and software to process
data, run algorithms or perform tasks requiring significant computing resources,
including artificial intelligence, blockchain, scientific research and cloud computing. (Sec.
1, 2)

0 Prop 105 (45 votes) OO Prop 108 (40 votes) OO Emergency (40 votes) UO Fiscal Note

HB 2342
Initials PB Page 1 Commerce

ATIACHMENT 26
oo ON DO FF WO HY

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Fe Oo Oo ON DO Oo fF WO YO KF CO

Fifty-seventh Legislature Commerce
First Regular Session H.B. 2342

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2342

(Reference to printed bill)

Strike everything after the enacting clause and insert:
"Section 1. Section 9-500.42, Arizona Revised Statutes, is amended

to read:

9-500.42. Prohibition on regulation of using computational

power or running node on blockchain technology;

state preemption; definitions

A. A city or town may not prohibit or otherwise restrict an
individual from LAWFULLY ACCESSING OR USING COMPUTATIONAL POWER OR running
a node on blockchain technology in a residence.

B. The regulation of the act of LAWFULLY ACCESSING OR USING
COMPUTATIONAL POWER OR running a node on blockchain technology in a
residence is of statewide concern and not subject to further regulation by
a city or town.

C. For the purposes of this section: >—

1. “COMPUTATIONAL POWER" MEANS THE USE OF COMPUTER HARDWARE AND
SOFTWARE TO PROCESS DATA, RUN ALGORITHMS OR PERFORM TASKS REQUIRING
SIGNIFICANT COMPUTING RESOURCES, INCLUDING ARTIFICIAL INTELLIGENCE,
BLOCKCHAIN, SCIENTIFIC RESEARCH AND CLOUD COMPUTING.

2. “Running a node on blockchain technology" means’ providing
computing power to validate or encrypt transactions in_ blockchain

technology as defined in section 44-7061.

. ATTACHMENT 37]
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en
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20

House Amendments to H.B. 2342

Sec. 2. Section 11-269.22, Arizona Revised Statutes, is amended to

read:

11-269.22. Prohibition on regulation of using computational

power or running node on blockchain technology;

state preemption; definitions

A. A county may not prohibit or otherwise restrict an individual
from LAWFULLY ACCESSING OR USING COMPUTATIONAL POWER OR running a node on
blockchain technology in a residence.

B. The regulation of the act of LAWFULLY ACCESSING OR USING
COMPUTATIONAL POWER OR running a node on blockchain technology in a
residence is of statewide concern and not subject to further regulation by
a county.

C. For the purposes of this section: >—

1. “COMPUTATIONAL POWER" MEANS THE USE OF COMPUTER HARDWARE AND
SOFTWARE TO PROCESS DATA, RUN ALGORITHMS OR PERFORM TASKS REQUIRING
SIGNIFICANT COMPUTING RESOURCES, INCLUDING ARTIFICIAL INTELLIGENCE,
BLOCKCHAIN, SCIENTIFIC RESEARCH AND CLOUD COMPUTING.

2. “Running a node on_ blockchain’ technology" means_ providing
computing power to validate or encrypt transactions in_ blockchain

technology as defined in section 44-7061."

21 Amend title to conform

JEFF WENINGER

2342WENINGER. docx
02/14/2025

02:34
C: LAT

PM
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

ROLL CALL VOTE

COMMITTEE ON Commerce BILL NO. HB 2342

il
DATE February 18, 2025 motion: DPA [ y &

PRESENT | ABSENT

PASS AYE

Aguilar

“a

Blackman

Cavero

Connolly

Diaz

Hendrix

\ | INN NE

Villegas
Wilmeth
Way, Vice-Chairman

Weninger, Chairman

(NINA) [NN

4} o |]

LW eee CoyfanTTEe SECRITARY

“JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

ATTACHMENT 3%
ARIZONA HOUSE OF REPRESENTATIVES

Fifty-seventh Legislature
First Regular Session

HB 2324; technical correction; unclaimed property; interest
S/E: forfeiture; digital assets; reserve fund
Sponsor: Representative Weninger, LD 13

Committee on Commerce

Summary of the Strike Everything Amendment to HB 2324

Overview
Provides for the forfeiture and seizure of a digital asset. Establishes the Bitcoin and Digital

Assets Reserve Fund.

History
Except as provided in statute, all property, including all interests in such property, described

in a statute providing for its forfeiture is subject to forfeiture if:

1) the owner is convicted of an offense to which forfeiture applies; and

2) the state establishes by clear and convincing evidence that the property is subject to
forfeiture.

After a person is convicted of an offense for which forfeiture applies, a court may order the

person to forfeit:

1) property the person acquired through the commission of the offense.

2) property that is directly traceable to property acquired through the commission of the
offense.

3) any property or instrumentality that the person used in the commission of the offense or
to facilitate the offense.

4) substitute assets as prescribed by statute (A.R.S. § 13-4304).

Property that is subject to forfeiture may be seized by a peace officer:
1) on process issued pursuant to the Arizona rules of civil procedure or this title, including

a seizure warrant;

2) by making a seizure for forfeiture on property seized on process issued pursuant to law;
3) by making a seizure for forfeiture without court process if the officer has probable cause
to believe that the property is subject to forfeiture and any of the following is true:

a) the seizure for forfeiture is of property seized incident to a lawful arrest for a crime or
a lawful search;

b) the property subject to seizure for forfeiture has been the subject of a prior judgment
in favor of this state or any other state or the federal government in a forfeiture
proceeding;

c) the peace officer has probable cause to believe that the property is subject to forfeiture
and that the delay occasioned by the need to obtain a court order would result in the

OF Prop 105 (45 votes) O Prop 108 (40 votes) O Emergency (40 votes) O Fiscal Note

HB 2324
Initials PB Page 1 Commerce

ATTACHMENT 29
removal or destruction of the property or otherwise frustrate the seizure (A.R.S. § 13-
4305).

Provisions

ie.

10.

It;

Authorizes a court to order a person who is convicted of an offense for which forfeiture
applies to forfeit any digital asset used in, acquired through or traceable to the
commission of an offense. (Sec. 2)

Adds that property that is subject to forfeiture may be seized by a peace officer by making

a seizure of a digital assets by:

a) gaining access to a private key, passphrase or other access mechanism;

b) securing a digital wallet through blockchain technology; or

c) transferring the digital asset to a state-approved, secure digital wallet or platform.
(See. 3)

Requires a digital asset that is seized to be stored in a state-approved, secure digital
wallet system that is managed by authorized personnel to prevent loss, theft or
unauthorized access. (Sec. 3)

Authorizes the entity that received forfeited property by the state to sell a forfeited digital
asset by public or otherwise commercially reasonable sale with expenses of keeping and
selling the digital asset and the amount of all valid interests established by claimants
paid out of the proceeds for the sale. (Sec. 4)

Requires the remaining balance of the proceeds of the sale be deposited as follows:
a) 50% in the state General Fund; and
b) 50% in the Bitcoin and Digital Assets Reserve Fund (Fund). (Sec. 4)

Specifies the digital asset must be sold through state-approved cryptocurrency exchanges
or other secure platforms to ensure accurate valuation and transparency and may remain
in its native form. (Sec. 4)

Kstablishes the (Fund) to store, manage and allocate digital assets securely. (Sec. 5)

Specifies the Fund consisting of forfeited digital assets seized or deposited which may be
in the forms of a digit asset and bitcoin. (Sec. 5)

Specifies the Fund is administered by the State Treasurer and is subject to legislative
appropriation. (Sec. 5)

Stipulates that, on legislative approval, 10% of the digital assets held in the Fund are
deposited in the state General Fund. (Sec. 5)

Defines airdrop, digital asset, and non-fungible token. (Sec. 1, 5)

HB 2324

Initials PB Page 2 Commerce
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Fifty-seventh Legislature Commerce
First Regular Session H.B. 2324

PROPOSED
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2324
(Reference to printed bill)

Strike everything after the enacting clause and insert:

"Section 1. Section 13-4301, Arizona Revised Statutes, is amended to
read:

13-4301. Definitions

In this chapter, unless the context otherwise requires:

1. "Abandoned THE property”:

(a) Means persorat—property that the owner OF PERSONAL PROPERTY has
intentionally relinquished the right to and control over THE PERSONAL
PROPERTY.

(b) Does not tmethrde APPLY TO property that is obtained as a result
of a peace officer requesting, requiring or inducing a person to execute a
document that purports to disclaim an interest in or right to the property
or that relinquished interest in or rights to the property.

2. “Attorney for the state" means an attorney designated by the
attorney general, by a county attorney or by a city attorney to
investigate, commence and prosecute an action under this chapter.

3. "Commercially reasonable" means a sale or disposal that would be
commercially reasonable under title 47, chapter 9, article 6.

4. “DIGITAL ASSET":

(a) MEANS A DIGITAL REPRESENTATION OF VALUE, RIGHTS OR OWNERSHIP
THAT IS RECORDED AND TRANSFERRED ELECTRONICALLY USING BLOCKCHAIN TECHNOLOGY
OR OTHER DISTRIBUTED SYSTEMS.

(b) INCLUDES ANY OF THE FOLLOWING:

(i) CRYPTOCURRENCY.

(ii) A NONFUNGIBLE TOKEN.

(iii) TOKENIZED REAL-WORLD ASSETS.

Withdraw!

Analysts

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House Amendments to H.B. 2324

(iv) AN AIRDROP.

(v) A FORKED TOKEN.

(vi) DECENTRALIZED FINANCE REWARDS OR TOKENS.

(vii) VIRTUAL CURRENCY. FOR THE PURPOSES OF THIS ITEM, “VIRTUAL
CURRENCY" HAS THE SAME MEANING PRESCRIBED IN SECTION 43-1028.

(viii) OTHER DIGITAL REPRESENTATIONS THAT MAY HOLD ECONOMIC, UTILITY
OR OWNERSHIP VALUE.

4> 5. “Injured person" means a person who has sustained economic
loss, including medical loss, as a result of injury to his person, business
or property by the conduct giving rise to the forfeiture of property, and
who is not an owner of or an interest holder in the property. Injured
person does not include a person who is responsible for the conduct giving
rise to forfeiture or a person whose interest would not be exempt from
forfeiture if the person were an owner of or interest holder in the
property.

Sy 6. "Interest holder" means a person in whose favor there is a
security interest or who is the beneficiary of a perfected encumbrance
pertaining to an interest in property.

6- 7. "Owner" means a person who is not a secured party as defined
in section 47-9102 and who has an interest in property, whether legal or
equitable. A person who holds property for the benefit of or as agent or
nominee for another is not an owner. A purported interest that is not in
compliance with any statute requiring its recordation or reflection in
public records in order to perfect the interest against a bona fide
purchaser for value shall not be recognized as an interest against this
state in an action pursuant to this chapter. An owner with power to convey
property binds other owners, and a spouse binds his spouse, by his act or
omission,

7- 8. “Person known to have an interest" means a person whose
interest in property is reflected in the public records in which his
interest is required by law to be recorded or reflected in order to perfect
his interest. If a person's interest in property is not required by law to
be reflected in public records in order to perfect his interest in the

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House Amendments to H.B. 2324

property, a person shall be known to have an interest only if his interest
can be readily ascertained at the time the forfeiture action commences
pursuant to this chapter.

86> 9. “Personal property" includes all interests in property, as
defined in section 13-105, in whatever form, except real property and
fixtures as defined in section 47-9102.

98> 10. "Seizing agency" means any department or agency of this
state or its political subdivisions that regularly employs peace officers
and that employs the peace officer who seizes property for forfeiture, or
such other agency as the seizing agency may designate in a particular case
by its chief executive officer or the chief executive officer's designee.

té- 11. “Seizure for forfeiture" means seizure of property by a
peace officer and either:

(a) There is an assertion by the seizing agency or by an attorney
for the state that the property is subject to forfeiture.

(b) The property has no evidentiary value.

Sec. 2. Section 13-4304, Arizona Revised Statutes, is amended to
read:

13-4304. Property subject to forfeiture; exemptions; innocent

owner

A. Except as provided in subsections B, C and D of this section, all
property, including all interests in such property, described in a statute
providing for its forfeiture is subject to forfeiture if both of the
following apply:

1. The owner is convicted of an offense to which forfeiture applies.

2. The state establishes by clear and convincing evidence that the
property is subject to forfeiture as provided in subsection E of this
section.

B. A vehicle used by any person as a common carrier in_ the
transaction of business as a common carrier may not be forfeited under this
chapter unless the state proves by clear and convincing evidence that the
owner or other person in charge of the vehicle was a consenting party or
privy to the act or omission giving rise to forfeiture or knew of it.

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norF oOo 9D ON DO F&F WO YD KF DOD YB AN DO OT B® Ww KF Oo

House Amendments to H.B. 2324

C. A vehicle may not be forfeited under this chapter following a
conviction for any act or for an omission committed or omitted by a person
other than the owner while the vehicle was unlawfully in the possession of
a person other than the owner in violation of the criminal laws of this
state or of the United States.

D. Property may not be forfeited pursuant to section 13-3413,
subsection A, paragraph 1 or 3 if the conduct giving rise to the seizure
both:

1. Did not involve an amount of unlawful substance greater than the
statutory threshold amount as defined in section 13-3401.

2. Was not committed for financial gain.

E. After a person is convicted of an offense for which forfeiture
applies, a court may order the person to forfeit any of the following:

1. Property THAT the person acquired through the commission of the
offense.

2. Property that is directly traceable to property acquired through
the commission of the offense.

3. Any property or instrumentality that the person used in the
commission of the offense or to facilitate the offense.

4. Substitute assets as prescribed in section 13-2314, subsection D,
paragraph 6, subdivision (d) and in accordance with section 13-4305,
subsection C.

5. ANY DIGITAL ASSET USED IN, ACQUIRED THROUGH OR TRACEABLE TO THE
COMMISSION OF AN OFFENSE.

F. The court may waive the conviction requirement if the prosecuting
authority shows by clear and convincing evidence that there is no known
owner of the seized property, diligent efforts have been made to identify
the owner of the seized property and no person has asserted an ownership
interest in the seized property or that, before conviction, the defendant
or alleged criminal:

1. Died.

2. No longer resides in the United States or was deported.

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House Amendments to H.B. 2324

3. Was granted immunity or reduced punishment in exchange for
testifying or assisting a law enforcement investigation or prosecution.

4. Fled the jurisdiction of this state.

5. Abandoned the property.

G. This section does not prevent property from being forfeited by
the terms of a plea agreement that is approved by a court or by other
agreement of the parties in a criminal proceeding.

H. A person who claims to be an innocent owner has the burden of
production to show that the person either:

1. Held a legal right, title or interest in the property seized at
the time the illegal conduct that gave rise to the seizure of the property
occurred.

2. Acquired as a bona fide purchaser for value a legal right, title
or interest in the property subject to forfeiture after the commission of
the crime that gave rise to the seizure of the property.

I. If a person establishes that the person is an innocent owner
pursuant to subsection H of this section and the state pursues a forfeiture
proceeding with respect to that person's property, other than property
described in section 13-3413 to successfully forfeit the property, the
state shall prove by clear and convincing evidence that the innocent owner
had actual knowledge of the underlying crime that gave rise to the
forfeiture.

J. If the state is unable to prove the person is not an innocent
owner as provided in subsections H and I of this section, the court shall
find that the person is an innocent owner and order the state to relinquish
all claims of title to the property and return the property to the innocent
owner.

Sec. 3. Section 13-4305, Arizona Revised Statutes, is amended to
read:

13-4305. Seizure of property

A. Property subject to forfeiture under this chapter may be seized

for forfeiture by a peace officer:

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oO nF oO ODO ON DOT SP WH De KF TODO HD AN DTD OT fF WO DY KF CO

House Amendments to H.B. 2324

1. On process issued pursuant to the Arizona rules of civil
procedure or this title, including a seizure warrant.

2. By making a seizure for forfeiture on property seized on process
issued pursuant to law, including sections 13-3911, 13-3912, 13-3913,
13-3914 and 13-3915.

3. By making a seizure for forfeiture without court process if the
officer has probable cause to believe that the property is subject to
forfeiture and any of the following is true:

(a) The seizure for forfeiture is of property seized incident to a
lawful arrest for a crime or a lawful search.

(b) The property subject to seizure for forfeiture has been the
subject of a prior judgment in favor of this state or any other state or
the federal government in a forfeiture proceeding.

(c) The peace officer has probable cause to believe that’ the
property is subject to forfeiture and that the delay occasioned by the need
to obtain a court order would result in the removal or destruction of the
property or otherwise frustrate the seizure.

4. BY MAKING A SEIZURE OF A DIGITAL ASSET BY:

(a) GAINING ACCESS TO A PRIVATE KEY, PASSPHRASE OR OTHER ACCESS
MECHANISM.

(b) SECURING A DIGITAL WALLET THROUGH BLOCKCHAIN TECHNOLOGY.

(c) TRANSFERRING THE DIGITAL ASSET TO A_  STATE-APPROVED, SECURE
DIGITAL WALLET OR PLATFORM.

B. The court shall determine probable cause for seizure before real
property may be seized for forfeiture. The court may make its
determination ex parte if the state demonstrates that notice and an
opportunity to appear would create a risk of harm to the public safety or
welfare, including the risk of physical injury or the likelihood of
property damage or financial loss.

C. The court shall determine probable cause for seizure before
property may be seized for forfeiture as a substitute asset pursuant to
section 13-2314, subsection D or > or pursuant to section 13-4313,
subsection A. The court may issue a seizure warrant for such property if

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House Amendments to H.B. 2324

1 it determines that there is probable cause to believe that the property is
2 subject to forfeiture and is not available for seizure for forfeiture for
3 any reason described in section 13-4313, subsection A. The determinations
4 shall be made ex parte unless real property is to be seized and subsection
5 B of this section requires notice and an opportunity to appear.

6 D. In establishing probable cause for seizure, a_ rebuttable
7 presumption exists that the property of any person is subject to forfeiture
8 if the state establishes all of the following by clear and convincing
9 evidence:

10 1. Conduct giving rise to forfeiture occurred.

11 2. The person acquired the property during the period of the conduct
12 giving rise to forfeiture or within a reasonable time after that period.

13 3. There is no likely source for the property other than the conduct
14 giving rise to forfeiture.

15 E. The presence or possession of United States currency, debit cards
16 or credit cards, without other indicia of a crime that subjects property to
17 forfeiture, is insufficient probable cause for seizure of United States
18 currency, debit cards or credit cards.

19 F. A DIGITAL ASSET THAT IS SEIZED PURSUANT TO THIS CHAPTER MUST BE
20 STORED IN A STATE-APPROVED, SECURE DIGITAL WALLET SYSTEM THAT IS MANAGED BY
21 AUTHORIZED PERSONNEL TO PREVENT LOSS, THEFT OR UNAUTHORIZED ACCESS.

22 Sec. 4. Section 13-4315, Arizona Revised Statutes, is amended to
23 read:

24 13-4315. Allocation of forfeited property

25 A. Any property, including all interests in property, forfeited to
26 the state under this title shall be transferred as requested by the
27 attorney for the state to the seizing agency or to the agency or political
28 subdivision employing the attorney for the state, which may do any of the
29 following:

30 1. Sell, lease, lend or transfer the property to any local or state
31 government entity or agency or political subdivision, any law enforcement
32 agency or prosecutorial agency or any federal law enforcement agency that
33 operates within this state for official federal, state or political

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House Amendments to H.B. 2324

subdivision use within this state, with expenses for keeping and
transferring such property to be paid by the recipient. Property may not
be allocated for official use if the fair market value of the property
substantially exceeds the agency's probable cost of purchasing other
property equally suited for the intended official use. Property that is
allocated for official use may not be assigned for use by any person who
supervised or exercised discretion in its forfeiture unless the use is
approved in writing by the head of the agency.

2. Sell forfeited property by public or otherwise commercially
reasonable sale with expenses of keeping and selling the property and the
amount of all valid interests established by claimants paid out of the
proceeds of the sale with the balance paid into the anti-racketeering
revolving fund of the state or of the county in which the political
subdivision seizing the property or prosecuting the action is located. A
sale of forfeited property may not be made to any employee of the seizing
agency, any person who participated in the forfeiture, any employee of a
contractor selling the property on behalf of the seizing agency or any
member of the immediate family of any of these employees or persons.

3. SELL A FORFEITED DIGITAL ASSET BY PUBLIC OR _ OTHERWISE
COMMERCIALLY REASONABLE SALE WITH EXPENSES OF KEEPING AND SELLING THE
DIGITAL ASSET AND THE AMOUNT OF ALL VALID INTERESTS ESTABLISHED BY
CLAIMANTS PAID OUT OF THE PROCEEDS OF THE SALE. FIFTY PERCENT OF THE
REMAINING BALANCE SHALL BE DEPOSITED IN THE STATE GENERAL FUND AND THE
REMAINING FIFTY PERCENT SHALL BE DEPOSITED IN THE BITCOIN AND DIGITAL
ASSETS RESERVE FUND ESTABLISHED BY SECTION 41-180. DIGITAL ASSETS MUST BE
SOLD THROUGH STATE-APPROVED CRYPTOCURRENCY EXCHANGES OR OTHER SECURE
PLATFORMS TO ENSURE ACCURATE VALUATION AND TRANSPARENCY. A DIGITAL ASSET
MAY REMAIN IN ITS NATIVE FORM.

3> 4. Destroy or use for investigative purposes any illegal or
controlled substances or other contraband at any time more than twenty days
after seizure, on written approval of the attorney for the state,

preserving only such material as may be necessary for evidence.

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House Amendments to H.B. 2324

4> 5. Sell, use or destroy all raw materials, products and
equipment of any kind used or intended for use in manufacturing,
compounding or processing a controlled substance.

5> 6. Compromise and pay claims against property forfeited pursuant
to any provision of this section.

6> 7. Make any other disposition of forfeited property authorized
by law for the disposition of property of the state, government entity,
agency or political subdivision.

B. Notwithstanding subsection A of this section or any other law to
the contrary:

1. If the property forfeited is money, and a law enforcement agency
can specifically identify monies as being from its investigative funds or
as being exchanged for property from its investigative property, the monies
shall be remitted to the investigative fund. If there are additional
forfeited monies or monies tendered on satisfaction by an interest holder
that cannot be specifically identified, the court shall order the monies
returned to each law enforcement agency that makes a showing of costs or
expenses that it incurred in connection with the investigation and
prosecution of the matter and shall order all excess monies remaining after
such returns deposited in the anti-racketeering revolving fund of this
state or of the county in which the political subdivision seizing the
monies or prosecuting the action is located, established pursuant to
section 13-2314.01 or 13-2314.03.

2. If the property declared forfeited is an interest in a vehicle,
the court shall order it forfeited to the local, state or other law
enforcement agency seizing the vehicle for forfeiture or to the seizing
agency.

C. Monies in any = anti-racketeering revolving fund established
pursuant to this title may be used, in addition to any other lawful use,
for:

1. The payment of any expenses necessary to seize, detain, appraise,
inventory, protect, maintain, preserve the availability of, advertise or
sell property that is subject to forfeiture and that is seized, detained or

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House Amendments to H.B. 2324

forfeited pursuant to this title or of any other necessary expenses
incident to the seizure, detention, preservation or forfeiture of the
property. The payments may include payments for contract services and
payments to reimburse any federal, state or local agency for any
expenditures made to perform the investigative, storage and maintenance
functions associated with the property held by the seizing agency.

2. The payment of awards for information or assistance leading to a
civil or criminal proceeding under this title.

3. The payment of compensation from forfeited property to injured
persons as provided in section 13-4310, subsection P, paragraph 3.

D. Each attorney for the state shall submit a copy of each
forfeiture judgment, including each order of forfeiture, to the Arizona
criminal justice commission within sixty days after the forfeiture judgment
becomes final or after the conclusion of appellate review, if any.

Sec. 5. Title 41, chapter 1, article 4, Arizona Revised Statutes, is
amended by adding section 41-180, to read:

41-180. Bitcoin and digital assets reserve fund; definitions

A. THE BITCOIN AND DIGITAL ASSETS RESERVE FUND IS ESTABLISHED TO
STORE, MANAGE AND ALLOCATE DIGITAL ASSETS SECURELY. THE FUND CONSISTS OF
FORFEITED DIGITAL ASSETS SEIZED OR DEPOSITED PURSUANT TO SECTIONS 13-4305
AND 13-4315. THE STATE TREASURER SHALL ADMINISTER THE FUND. MONIES IN THE
FUND ARE SUBJECT TO LEGISLATIVE APPROPRIATION. THE FORFEITED DIGITAL ASSET
MAY BE IN THE FORMS OF A DIGITAL ASSET AND BITCOIN.

B. ON APPROVAL OF THE LEGISLATURE, TEN PERCENT OF THE DIGITAL ASSETS
HELD IN THE FUND SHALL BE DEPOSITED IN THE STATE GENERAL FUND. THE
LEGISLATURE MAY NOT DEPOSIT BITCOIN INTO THE STATE GENERAL FUND.

C. FOR THE PURPOSES OF THIS SECTION:

1. "“AIRDROP" MEANS THE RECEIPT OF VIRTUAL CURRENCY THROUGH A MEANS
OF DISTRIBUTION OF VIRTUAL CURRENCY TO THE DISTRIBUTED LEDGER ADDRESSES OF
MULTIPLE TAXPAYERS.

2> “DIGITAL ASSET”*

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House Amendments to H.B. 2324

(a) MEANS A DIGITAL REPRESENTATION OF VALUE, RIGHTS OR OWNERSHIP
THAT IS RECORDED AND TRANSFERRED ELECTRONICALLY USING BLOCKCHAIN TECHNOLOGY

OR OTHER DISTRIBUTED SYSTEMS.

(b) INCLUDES ANY OF THE FOLLOWING:

(i) CRYPTOCURRENCY.

(ii) A NONFUNGIBLE TOKEN.

(iii) TOKENIZED REAL-WORLD ASSETS.

(iv) AN AIRDROP.

(v) A FORKED TOKEN.

(vi) DECENTRALIZED FINANCE REWARDS OR TOKENS.

(vii) VIRTUAL CURRENCY. FOR THE PURPOSES OF THIS ITEM,
CURRENCY" HAS THE SAME MEANING PRESCRIBED IN SECTION 43-1028.

(viii) OTHER DIGITAL REPRESENTATIONS THAT MAY HOLD ECONOMIC,
OR OWNERSHIP VALUE.

3. “"NON-FUNGIBLE TOKEN" HAS THE SAME MEANING PRESCRIBED IN

43-1028."

17 Amend title to conform

JEFF WENINGER

2324WENINGER SE.docx
02/14/2025

12:05
CG: SP

PM

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"VIRTUAL

UTILITY

SECTION
ARIZONA HOUSE OF REPRESENTATIVES
Fifty-seventh Legislature - First Regular Session

COMMITTEE ON

ROLL CALL VOTE

Commerce

BILL NO.

DATE

February 18, 2025

HB 2324

motion: DPA SJE

PASS

>
x

E NAY

PRESENT

ABSENT

Aguilar

Blackman

x

Cavero

Connolly

Diaz

Hendrix

Villegas

Wilmeth

Way, Vice-Chairman

Weninger, Chairman

APPROVED:

JEFF WENINGER, Chairman
MICHAEL WAY, Vice-Chairman

es,

ae,

S PINVAANNANL A

Dbyeap—

COMMITTEE SEGRETARY

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