Assigned to HHS FOR COMMITTEE
ARIZONA STATE SENATE
Fifty-Seventh Legislature, First Regular Session
FACT SHEET FOR S.B. 1537
transitional housing; reentry programs; licensure
Purpose
Establishes a regulatory system for the licensing and operation of transitional housing
facilities to provide temporary living arrangements and basic living necessities to individuals
transitioning from incarceration to independent living.
Background
The Department of Health Services (DHS) is established to promote and protect the health
of residents and provide and coordinate public health services and programs for Arizona.
Responsibilities of DHS include but are not limited to: 1) promoting the development,
maintenance, efficiency and effectiveness of local health departments or districts; 2) conducting a
statewide health education program; 3) conducting continual evaluations of state, local and district
public health programs; and 4) licensing and regulating health care institutions. In addition to
health care institutions, statute requires the Director of DHS (Director) to establish minimum
standards and requirements for the licensure of sober living homes to ensure the public health,
safety and welfare. The Director may use the current standards adopted by any recognized national
organization approved by DHS as guidelines in prescribing the minimal standards and
requirements but must include outlined statutory policies and procedures (A.R.S. §§ 36-132 and
36-2061).
The Arizona Department of Corrections, Rehabilitation & Reentry (ADCRR) is required
to contract with private and nonprofit entities that provide eligible inmates with transition services
in the community for up to 90 days. Rules adopted for the implementation of this program must
include: 1) eligibility criteria for inmates; 2) a requirement that each contracted entity train mentors
or certify the mentors are trained; 3) a requirement that services offered to an inmate include
psychoeducational counseling and case management services; and 4) a requirement that an inmate
may only be released to the transition program after the victim has been provided notice and an
opportunity to be heard. In awarding contracts for transition services, ADCRR must also:
1) conduct annual studies on recidivism rates for inmates who receive transition services; 2) submit
a report of its recidivism findings that contains prescribed information; and 3) provide information
about transition services to all inmates who may be eligible.
To be considered eligible for transition services, an inmate must: 1) not be convicted of
sexual offenses or violent crimes as outlined; 2) not have any felony detainers; 3) agree in writing
to provide specific information after the inmate is released to be used for recidivism reports;
4) have made satisfactory progress by complying with all programming on the inmate's
individualized corrections plan; 5) be classified as minimum or medium custody; and 6) not have
been found in violation of any major violent rule during the inmate's current period of incarceration
or in violation of any other major rule within the previous six months (A.R.S. § 31-281). FACT SHEET
S.B. 1537
Page 2
If there is a cost to DHS associated with the licensure and regulation of transitional housing
facilities, there may be a fiscal impact to the state General Fund (state GF).
Provisions
1. Requires the Director to adopt rules to establish minimum standards and requirements for the
licensure of transitional housing facilities in Arizona as necessary to ensure the public health,
safety and welfare, including:
a) a requirement that each transitional housing facility develop policies and procedures to
promote reentry of individuals into society after incarceration by requiring participation in
treatment, self-help groups or other community support;
b) policies requiring abstinence from alcohol and illicit drugs;
c) a requirement that each transitional housing facility develop policies and procedures to
allow individuals or are on medication or medication-assisted treatment to continue to
receive the medication or treatment while living in the facility;
d) a policy that ensures individuals are informed of all transitional housing facility rules and
agreements;
e) a policy that requires each resident to complete a housing agreement outlining the rules of
the living arrangement within the transitional housing facility, including the length of stay
and reasons the individual can be discharged from the facility;
f) policies and procedures that require each transitional housing facility to maintain an
environment that promotes the safety of the surrounding neighborhood and the community
at large;
g) policies and procedures for discharge planning of persons living in the transitional housing
facility that do not negatively impact the surrounding community;
h) a good neighbor policy to address neighborhood concerns and complaints;
i) a requirement that each transitional housing facility post a statement of individual rights
that includes the right to file a complaint about the transitional housing facility or provider
and information about how to file a complaint;
j) policies regarding the maintenance of transitional housing facilities, including the
installation of functioning smoke detectors, carbon monoxide detectors and fire
extinguishers, and compliance with local fire codes;
k) policies and procedures that prohibit a transitional housing facility owner, employee or
administrator from requiring and individual to sign any document for purposes of
relinquishing the individual’s public assistance benefits, including medical assistance
benefits, cash assistance and supplemental nutrition assistance program benefits;
l) policies and procedures for managing complaints about transitional housing facilities; and
m) requirements for notifying an individual’s family member or other emergency contact as
designated by the individual under certain circumstances, including death.
2. Sets the term of a transitional housing facility license at two years.
3. Subjects a person or organization operating a transitional housing facility without attaining or
maintaining licensure to a civil penalty of up to $1,000.
4. Requires a transitional housing facility to comply with all federal, state and local laws as a
condition of licensure. FACT SHEET
S.B. 1537
Page 3
5. Allows facilities licensed to treat behavioral health, mental health, substance use or
co-occurring disorders to be located on the same campus as a transitional housing facility that
is separately licensed.
6. Prohibits, after the adoption of related DHS rules, a person or organization from establishing
or maintaining a transitional housing facility unless that person or organization holds a current
and valid license.
7. Specifies that a transitional housing facility license is valid only for the establishment,
operation and maintenance of a transitional housing facility.
8. Prohibits transitional housing facility licensees from:
a) implying by advertising or directory listing that the licensee is authorized to perform
services that are more specialized or of a higher degree of care than is otherwise authorized
by law for transitional housing facilities; and
b) transferring or assigning the license, which is valid only for the premises occupied by the
transitional housing facility at the time of issuance.
9. Requires DHS to establish by rule annual continuing education and training requirements for
employees, volunteers and contractors who work in a transitional housing facility.
10. Requires DHS to establish fees for initial licensure, license renewal and the late payment of
licensing fees, including a grace period.
11. Requires fees for initial licensure of a transitional housing facility to be based on a per facility
basis, not on bed count.
12. Requires DHS to deposit 90 percent of the fees collected from the licensure of transitional
housing facilities in the Health Services Licensing Fund and 10 percent to be deposited in the
state GF.
13. Allows the Director or the Director’s designee, upon a determination that there is reasonable
cause to believe a transitional housing facility is not adhering to licensure, to enter the premises
of the facility at any reasonable time for purposes of determining compliance with statute, DHS
rules and local fire ordinances or rules.
14. Specifies that a transitional housing facility license application constitutes permission for and
complete acquiescence in any entry or inspection of the premises during the pendency of the
application and, if licensed, during the term of licensure.
15. Authorizes the Director to take action against a transitional housing facility found not to be in
adherence with licensing requirements.
16. Subjects a transitional housing facility that knowingly operates in Arizona without a license to
a class 6 felony and a daily civil penalty of between $1,000 and $5,000 for each violation.
17. Allows the Director to impose a daily civil penalty on a person that violates transitional housing
facility statutes or rules in an amount between $1,000 and $5,000 for each violation. FACT SHEET
S.B. 1537
Page 4
18. Requires the Director, in the assessment of civil penalties, to issue a notice including the
proposed amount of the penalty.
19. Prohibits the Director from taking action to enforce and assess a civil penalty on any person
who requests an appeals hearing.
20. Requires the Director to impose a civil penalty only for days in which a violation was
documented by DHS.
21. Allows DHS to impose sanctions and commence disciplinary actions against a licensed
transitional housing facility, including revoking the license.
22. Prohibits a transitional housing facility license from being suspended or revoked without
affording the licensee notice and an opportunity for a hearing.
23. Allows DHS to contract with a third party to assist with transitional housing facility licensure
and inspections.
24. Requires DHS to post the following information on its website for each licensed transitional
housing facility in Arizona, to be updated quarterly:
a) the name and telephone number;
b) the license number;
c) the local jurisdiction business license number; and
d) licensure status
25. Requires transitional housing facility staff to notify DHS, in a DHS-provided format,
immediately and no more than eight hours after:
a) the death of an individual residing in the facility, including whether the death may have
been drug related;
b) a sex-related crime may have been committed at the facility; or
c) any other incident specified by DHS rules.
26. Prohibits transitional housing facility staff from having a personal or intimate relationship with
any individual residing in the facility.
27. Requires transitional housing facility staff to contact law enforcement if informed that an
individual residing in the facility may have been involved in a sex-related crime.
28. Requires transitional housing facility licensees to ensure that any individual residing in the
facility that is required to register as a sex offender does so within the statutorily required time
frame after admission to the facility.
29. Excludes transitional housing facilities from the definition of sober living home.
30. Defines transitional housing facility as a temporary living arrangement for an individual as the
individual transitions from incarceration to independent living that provides basic necessities,
including housing, clothing and hygiene necessities, at no cost to the individual.
31. Defines terms. FACT SHEET
S.B. 1537
Page 5
32. Makes technical and conforming changes.
33. Becomes effective on the general effective date.
Prepared by Senate Research
February 17, 2025
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