REFERENCE TITLE: school districts; leases; termination; nonrenewal State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025 HB 2640 Introduced by Representative Gress AN ACT amending section 15-119, Arizona Revised Statutes; relating to school leases. (TEXT OF BILL BEGINS ON NEXT PAGE)
REFERENCE TITLE: school districts; leases; termination; nonrenewal
State of Arizona House of Representatives Fifty-seventh Legislature First Regular Session 2025
HB 2640
Introduced by Representative Gress
REFERENCE TITLE: school districts; leases; termination; nonrenewal
State of Arizona
House of Representatives
Fifty-seventh Legislature
First Regular Session
2025
HB 2640
Introduced by
Representative Gress
AN ACT
amending section 15-119, Arizona Revised Statutes; relating to school leases.
(TEXT OF BILL BEGINS ON NEXT PAGE)
Be it enacted by the Legislature of the State of Arizona: Section 1. Section 15-119, Arizona Revised Statutes, is amended to read: START_STATUTE15-119. Vacant and partially used buildings; list; sale or lease; lease termination and renewal; equipment; definitions A. The division of school facilities within the department of administration shall annually publish a list of vacant buildings and partially used buildings that are owned by this state or by school districts in this state and that may be suitable for the operation of a school. The division of school facilities shall make the list publicly available on the website of the division of school facilities and on request to applicants for charter schools, to applicants applying to the division of school facilities for additional space and to existing district and charter schools. The list shall include the address of each building, a short description of the building, the name of the owner of the building and any other pertinent information related to the vacancy and capacity of the building. The division of school facilities shall annually submit the list to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of the list to the secretary of state and the state board for charter schools. B. If a school district decides to sell or lease a vacant building or partially used building, the school district may not prohibit a charter school or a private school from negotiating to buy or lease the property in the same manner as other potential buyers or lessees. A school district may not accept an offer for the sale or lease of the vacant building or partially used building from a potential buyer or lessee that is less than an offer from a charter school or private school. This section does not require the owner of a building on the list to sell or lease the building or a portion of the building to a charter school, to any other school or to any other prospective buyer or tenant, except that the owner of a building on the list may not withdraw the property from sale or lease solely because a charter school or private school is the highest bidder. C. At the conclusion of a lease for an existing tenant that is a public school or private school or that is providing provides services to public school students, the lease may be terminated, renewed according to the terms of the existing agreement, or renewed with a negotiated increase, . except that: 1. If the building owner intends to negotiate an increase, the building owner must provide the rationale for a proposed increase to the lessee, which may include considerations for the percentage of revenue that should be dedicated to educational facilities, inflators related to student enrollment increases or the annual GDP price deflator as defined in section 41-563, or expenses for building and parking lot maintenance and upgrades. 2. A school district, as the building owner, may terminate the lease or refuse to renew the lease only if the school district governing board does all of the following: (a) Announces in a public hearing that the board proposes to refuse to renew or to terminate the lease. (b) Provides an opportunity for public comment regarding the proposal that is announced pursuant to subdivision (a) of this paragraph for At least ninety days after the date of the announcement and before the board may vote on the proposal. Public comment may include written comments, comments submitted through email or oral comments during public hearings required pursuant to this paragraph. (c) reviews and considers any public comments submitted pursuant to subdivision (b) of this paragraph before Approving the nonrenewal or termination of the lease. (d) Approves the proposal to refuse to renew or to terminate the lease in a public hearing before the date of the proposed termination or the date on which the lease is scheduled to expire. C. D. A school district may sell used equipment to a charter school or private school before the school district attempts to sell or dispose of the equipment by other means. D. E. Buildings that are used for career and technical education, special education services, or preschool programs, schools that have been open for fewer than five years or magnet schools are not considered partially used buildings for the purposes of this section, except that this exemption may not be applied to more than twenty-five percent of a district's school buildings. E. F. For the purposes of this section: 1. "Partially used building" means a building with at least four thousand five hundred square feet of contiguous, unused space. 2. "Vacant building" means a building that has been vacant and unused for at least two years. END_STATUTE Sec. 2. Retroactivity This act applies retroactively to from and after January 1, 2025.
Be it enacted by the Legislature of the State of Arizona:
Section 1. Section 15-119, Arizona Revised Statutes, is amended to read:
START_STATUTE15-119. Vacant and partially used buildings; list; sale or lease; lease termination and renewal; equipment; definitions
A. The division of school facilities within the department of administration shall annually publish a list of vacant buildings and partially used buildings that are owned by this state or by school districts in this state and that may be suitable for the operation of a school. The division of school facilities shall make the list publicly available on the website of the division of school facilities and on request to applicants for charter schools, to applicants applying to the division of school facilities for additional space and to existing district and charter schools. The list shall include the address of each building, a short description of the building, the name of the owner of the building and any other pertinent information related to the vacancy and capacity of the building. The division of school facilities shall annually submit the list to the governor, the president of the senate and the speaker of the house of representatives and provide a copy of the list to the secretary of state and the state board for charter schools.
B. If a school district decides to sell or lease a vacant building or partially used building, the school district may not prohibit a charter school or a private school from negotiating to buy or lease the property in the same manner as other potential buyers or lessees. A school district may not accept an offer for the sale or lease of the vacant building or partially used building from a potential buyer or lessee that is less than an offer from a charter school or private school. This section does not require the owner of a building on the list to sell or lease the building or a portion of the building to a charter school, to any other school or to any other prospective buyer or tenant, except that the owner of a building on the list may not withdraw the property from sale or lease solely because a charter school or private school is the highest bidder.
C. At the conclusion of a lease for an existing tenant that is a public school or private school or that is providing provides services to public school students, the lease may be terminated, renewed according to the terms of the existing agreement, or renewed with a negotiated increase, . except that:
1. If the building owner intends to negotiate an increase, the building owner must provide the rationale for a proposed increase to the lessee, which may include considerations for the percentage of revenue that should be dedicated to educational facilities, inflators related to student enrollment increases or the annual GDP price deflator as defined in section 41-563, or expenses for building and parking lot maintenance and upgrades.
2. A school district, as the building owner, may terminate the lease or refuse to renew the lease only if the school district governing board does all of the following:
(a) Announces in a public hearing that the board proposes to refuse to renew or to terminate the lease.
(b) Provides an opportunity for public comment regarding the proposal that is announced pursuant to subdivision (a) of this paragraph for At least ninety days after the date of the announcement and before the board may vote on the proposal. Public comment may include written comments, comments submitted through email or oral comments during public hearings required pursuant to this paragraph.
(c) reviews and considers any public comments submitted pursuant to subdivision (b) of this paragraph before Approving the nonrenewal or termination of the lease.
(d) Approves the proposal to refuse to renew or to terminate the lease in a public hearing before the date of the proposed termination or the date on which the lease is scheduled to expire.
C. D. A school district may sell used equipment to a charter school or private school before the school district attempts to sell or dispose of the equipment by other means.
D. E. Buildings that are used for career and technical education, special education services, or preschool programs, schools that have been open for fewer than five years or magnet schools are not considered partially used buildings for the purposes of this section, except that this exemption may not be applied to more than twenty-five percent of a district's school buildings.
E. F. For the purposes of this section:
1. "Partially used building" means a building with at least four thousand five hundred square feet of contiguous, unused space.
2. "Vacant building" means a building that has been vacant and unused for at least two years. END_STATUTE
Sec. 2. Retroactivity
This act applies retroactively to from and after January 1, 2025.