ARIZONA STATE SENATE
RESEARCH STAFF
TO: MEMBERS OF THE SENATE
APPROPRIATIONS COMMITTEE
DATE: March 22, 2024
SUBJECT: Strike everything amendment to H.B. 2279, relating to homeless; fund; audit
Purpose
Outlines requirements in a drug-free homeless service zone and establishes the Homeless
Shelter and Services Fund (Fund) to provide grants to outlined operators or providers within a
drug-free homeless service zone. Transfers $5,500,000 from the Housing Trust Fund deposit line
item to the Office of the Auditor General (OAG) and Arizona Criminal Justice Commission
(ACJC) and appropriates $50,000,000 from the Consumer Remediation Subaccount (Subaccount)
to the Arizona Health Care Cost Containment System (AHCCCS) for outlined purposes.
Background
It is unlawful for a person to intentionally be present in a drug-free school zone to sell or
transfer marijuana, peyote, prescription-only drugs, dangerous drugs or narcotic drugs, to possess
or use the prescribed drugs, or to manufacture these drugs in a drug-free school zone. A person
who commits a prescribed offense is guilty of the same class of felony that the person would be
guilty of had the offense occurred outside of the drug-free school zone, except that the
presumptive, minimum and maximum sentence must be increased by one year. In addition to any
other penalty, the court must order a person who is convicted of a violation in a drug-free school
zone to pay a fine of at least $2,000 or three times the amount of the value of the drug involved in
the offense, whichever is greater, as determined by the court. A judge may not suspend any part or
all of the fine (A.R.S. § 13-3411).
The duties of the ACJC include: 1) monitoring the progress and implementation of new
and continuing criminal justice legislation; 2) facilitating coordinated statewide efforts to improve
criminal justice information and data sharing; 3) preparing for the Governor a biennial justice
system review report; 4) in coordination with other governmental agencies, gathering information
on programs that are designed to effectuate community crime prevention and education; 5) making
reports to the Governor and the Legislature as required; and 6) overseeing the research analyses,
studies, reports and publication of crime and criminal justice statistics prepared by the Arizona
Statistical analysis center (A.R.S. § 41-2405).
The Subaccount of the Consumer Restitution and Remediation Revolving Fund is
administered by the Attorney General (AG) and consists of monies collected or received by the
AG as the result of court order, or as the result of a settlement or compromise, to rectify violations
or alleged violations of consumer protection laws, other than monies collected for the benefit of
specific, identifiable persons and monies for investigative or court costs, attorney fees, civil
penalties or other monies recovered as a result of the enforcement of consumer protection laws
deposited in the Consumer Protection-Consumer Fraud Revolving Fund. Up to $4,000,000 of the
Subaccount monies related to opioid claims-related litigation or settlements are continuously
appropriated and all monies in the Subaccount are exempt from lapsing. The AG may spend
monies in the Subaccount for programs, including consumer fraud education programs, that are
intended to rectify violations of consumer protection laws (A.R.S. § 44-1531.02).
SAMUEL ROSENBERG
ASSISTANT RESEARCH ANALYST
LIAM MAHER
LEGISLATIVE RESEARCH ANALYST
APPROPRIATIONS COMMITTEE
Telephone: (602) 926-3171 STRIKER MEMO
H.B. 2279
Page 2
The Housing Trust Fund is administered by the Director of the Arizona Department of
Housing (ADOH) and consists of: 1) monies from unclaimed property; 2) the Arizona Industrial
Development Authority single-family mortgage program year-end balance; and 3) investment
earnings. The Housing Trust Fund provides grants for development projects and programs
connected with providing housing opportunities for low- and moderate-income households and for
housing affordability programs. A portion of the monies must be used exclusively for housing in
rural areas. Housing Trust Fund monies may be spent on constructing or renovating facilities and
on housing assistance, including support services, for persons who have been determined to be
seriously mentally ill and to be chronically resistant to treatment. Monies in the Housing Trust
Fund are exempt from lapsing, and up to 10 percent of the monies may be appropriated annually
by the Legislature to the ADOH for administrative costs (A.R.S. § 41-3955).
There is no anticipated fiscal impact to the state General Fund associated with this
strike-everything amendment.
Provisions
Drug-Free Homeless Service Zones
1. Requires an operator of facility-based services that serve homeless individuals to adopt a
formal policy that prohibits the use or possession of dangerous drugs or narcotics drugs within
drug-free homeless service zones.
2. Declares that it is unlawful for a person to:
a) intentionally be present in a drug-free homeless service zone to sell or transfer drugs or
narcotic drugs; or
b) as employee of a facility-based service that primarily serves homeless individuals and that
receives state, local or federal monies, knowingly violate any formal policy, including
intentionally allowing the possession or use of dangerous drugs or narcotic drugs in a drug-
free homeless service zone.
3. Deems a person who violates the prohibition on the sale or transfer of drugs as:
a) guilty of the same class of felony that the person would otherwise be guilty of had the
violation not occurred within a drug-free homeless service zone, except that the
presumptive, minimum and maximum sentences must be increased by one year; and
b) ineligible for suspension of sentence, probation, pardon or release from confinement,
except under outlined laws relating to work release, until the imposed sentence imposed by
the court has been served or commuted, unless outlined conditions apply.
4. Deems a person in violation of the prohibition on knowingly violating any formal policy as
guilty of a class 1 misdemeanor.
5. Requires the court to order a person who is convicted of a violation to pay a fine of at least
$2,000 or three times the value, as determined by the court, of the drugs involved in or giving
rise to the charge, whichever is greater, and up to the maximum authorized by law, in addition
to any other prescribed penalty.
6. Prohibits a judge from suspending any part or all of the imposition of any required fine. STRIKER MEMO
H.B. 2279
Page 3
7. Requires each operator or provider of facility-based services that primarily serve homeless
individuals to place and maintain a permanently affixed sign located in a visible manner inside
the facility and outside the main entrance of the facility that identifies the building and its
accompanying grounds as a drug-free zone.
8. Requires an operator or provider, if the operator or provider of facility-based services primarily
serves domestic violence victims or families, to place and maintain a permanently affixed sign
located in a visible manner inside the facility that identifies the building as a drug-free zone.
Homeless Shelter and Services Fund
9. Establishes the Fund, to be administered by the ADOH and consisting of and subject to
legislative appropriations.
10. Exempts monies in the Fund from lapsing.
11. Requires all prior and future grants from the Fund to be made only to operators or providers
within a drug-free homeless service zone.
12. Requires grants to be performance based and track each individual experiencing homelessness
who receives services from the grantee for a period of three years on the following key metrics:
a) duration of time the individual has maintained stable housing;
b) duration of time and type of employment obtained by the individuals;
c) duration of time the individual has maintained sobriety; and
d) any instances and duration of time the individual has returned to homelessness.
13. Requires each grant recipient, by December 1, 2024, and each year thereafter for three years,
to submit a report to ADOH that includes a summary of all of the tracked key metrics for each
homeless individual on which grant monies were spent.
14. Requires ADOH to prescribe a simplified form and procedure to apply for and approve grants
and establish requirements and criteria by which grants will be awarded.
15. Requires ADOH to prioritize providing grants for services for individuals experiencing
homelessness who are:
a) children;
b) parents or legal guardians with children;
c) senior citizens; or
d) veterans.
16. Prohibits a person from using or allowing to be used state or local government-owned lands
for any unauthorized sleeping, camping or long-term shelter.
17. Requires a person who violates the prohibition relating to unauthorized sleeping, camping or
long-term shelter to receive a warning for any offense.
18. Prohibits a person who violates the prohibition relating to unauthorized sleeping, camping or
long-term shelter from being issued a citation, except that services or shelter may be offered
instead of a criminal citation if the individual does not continue to use the land for prohibited
purposes. STRIKER MEMO
H.B. 2279
Page 4
19. Prohibits a political subdivision from:
a) adopting or enforcing any policies that directly prohibit or discourage enforcing any order
or ordinance that prohibits public camping, sleeping or obstructing a public right-of-way,
including roads and sidewalks; and
b) directly prohibiting or discouraging a peace officer or prosecuting attorney who is
employed by or under the direction or control of the political subdivision from enforcing
any order or ordinance that prohibits public camping, sleeping or obstructing a public right-
of-way, including roads and sidewalks.
20. Prohibits any political subdivision that receives monies for grants from receiving any further
funding until ADOH determines that the political subdivision is in compliance with the
outlined prohibition on prohibiting public camping, sleeping or obstructing a public-right-of-
way.
21. Stipulates that the outlined requirements and prohibitions do not prohibit a political subdivision
from offering diversion programs or services instead of issuing a citation or making an arrest
if the individual does not continue to use the land for prohibited purposes.
22. Allows a county attorney to bring a civil action in any court of competent jurisdiction against
any political subdivision to enjoin the political subdivision from violating the outlined
requirements and prohibitions.
23. Allows the county attorney to recover reasonable expenses incurred in any of the outlined civil
actions, including court costs, attorney fees, investigative costs, witness fees and deposition
costs.
24. Requires ADOH to provide a quarterly report to the Joint Legislative Budget Committee
(JLBC) that outlines fund expenditures, grant recipients, the number of individuals served,
selected vendors and other information as requested by the Chairperson of JLBC.
Mixed Hoteling
25. Requires a hotel owner, if the hotel owner engages in mixed hoteling, to post signs over each
entrance and exit to the building and in a place clearly visible from the reception desk
containing a prescribed statement that informs the reader that the business is being used to
house homeless individuals alongside the general public and that it is recommended that all
guests keep hotel doors locked, safely store belongings and report any health or safety concerns
to local law enforcement.
26. Requires all required signs to be in red, 25-point highway gothic bolded font, on a white
background and on a sign that is at least 18 inches in width and 24 inches in height.
27. Requires all hotels participating in mixed hoteling to disclose that the hotel is engaging in
mixed hoteling and share the text of the sign with the customer at the time of arrival.
28. Requires any guest who objects to mixed hoteling to be issued a full refund at the time of
arrival.
29. Prohibits state or local monies from being used for mixed hoteling. STRIKER MEMO
H.B. 2279
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30. Defines mixed hoteling as providing rooms or shelter services, whether emergency, temporary
or transitional rooms or shelter, to homeless individuals while concurrently providing hotel
services to the general public in the same building or on the same premises, not including
providing emergency or temporary shelter to individuals who are victims of domestic violence
or parents or legal guardians with children.
Special Audit
31. Requires the OAG to conduct a special audit which is limited in scope of the amount of monies
spent on programs and services for individuals experiencing homelessness in Arizona,
including:
a) expenditures by the State of Arizona;
b) expenditures by municipalities, counties and political subdivisions, with homeless
populations higher than the per capita average of Arizona; and
c) expenditures of federal monies allocated to Arizona for homeless programs, including:
i. transportation to emergency shelter;
ii. responding to crisis calls; providing overnight shelter in jail; and
iii. enforcing camping bans.
32. Requires all state and local governmental entities to cooperate with the special audit and grant
access, at no cost, to all financial records and any other information necessary to complete the
special audit.
33. Requires the special audit to examine:
a) the awarding of any contracts and grants relating to homeless services and support;
b) any metrics used to examine the success of any expenditures;
c) the efficiency of the use of data management systems in relation to such programs; and
d) the expenditure for each individual experiencing homelessness for each service provided.
34. Requires the OAG, by December 31, 2025, to submit copies of the special audit report to the
Governor, the President of the Senate, the Speaker of the House of Representatives and provide
a copy of the report to the Secretary of State.
Applicability and Funding
35. Stipulates that any monies expended for programs that provide shelter and services to
unsheltered persons who are experiencing homelessness are subject to the requirements of the
Fund and may only be used for individuals who are U.S. citizens.
36. Transfers $5,500,000 of the $150,000,000 appropriation in the FY 2024 Housing Trust Fund
deposit line item to the following agencies:
a) $5,000,000 to the OAG for all necessary costs to conduct the special audit of the monies
spent on programs and services for individuals experiencing homelessness in Arizona; and
b) $500,000 to ACJC to implement the outlined data collection requirements.
37. Appropriates $50,000,000 from the Subaccount to AHCCCS to establish five additional secure
behavioral health residential facilities for individuals experiencing homelessness and for
provider support for the new facilities established. STRIKER MEMO
H.B. 2279
Page 6
Miscellaneous
38. Requires the ACJC to:
a) direct first responders, medical examiners and AHCCCS to provide information and data
to the ACJC, on drug overdoses among individuals experiencing homelessness, including
the number of drug overdoses and deaths caused by drug overdoses;
b) direct criminal justice agencies in Arizona to collect and provide information indicating
crimes committed by individuals who are identified as homeless and crimes committed
against individuals who are identified as homeless; and
c) submit an annual report regarding the provided information and data to the Governor, the
President of the Senate and the Speaker of the House of Representatives and provide a copy
of the report to the Secretary of State.
39. Defines individual experiencing homelessness as an individual who does not have a home or
permanent of residence and who is a U.S. citizen.
40. Defines dangerous drugs, drug-free homeless service zone, homeless individual and narcotic
drugs.
41. Makes technical and conforming changes.
42. Becomes effective on the general effective date.