ambulance services; certificates of necessity

HB2402 - 572R - H Ver

House Engrossed

ambulance services;
certificates of necessity

State of Arizona

House of Representatives

Fifty-seventh Legislature

Second Regular Session

2026

HOUSE BILL 2402

AN
ACT

Amending sections 36-2208 and 36-2217,
Arizona Revised Statutes; amending title 36, chapter 21.1, article 1, Arizona
Revised Statutes, by adding section 36-2220.01; Amending sections 36-2232,
36-2233, 36-2234, 36-2235 and 36-2236, Arizona Revised
Statutes; relating to emergency medical services.

(TEXT OF BILL BEGINS ON NEXT PAGE)

Be it
enacted by the Legislature of the State of Arizona:

Section 1. Section 36-2208, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2208.

Bureau of emergency medical services and trauma system; annual
statewide plan; regional plans

A.
There is established within the
department a

The
bureau of emergency medical
services and trauma system
that
is
responsible
for coordinating, establishing and administering

established
in the department to coordinate, establish and administer
a statewide
system of emergency medical services, trauma care and a trauma registry.

B. This chapter does not prevent any individual, law
enforcement officer, public agency or member of a city, town, fire district or
volunteer fire department from rendering on-site emergency medical care or, if,
in terms of the existing medical situation, it is deemed not advisable to await
the arrival of an ambulance, from transporting emergency medical patients to a
hospital or an emergency receiving facility, except that if any patient objects
on religious grounds, that patient shall not be administered any medical
treatment or be transported to a hospital or an emergency receiving facility.

C. The director shall develop an annual statewide
emergency medical and trauma services plan and submit that plan to the council
for review and approval. The statewide plan shall then be submitted
to the governor for final adoption. Before submitting the plan to
the governor, the director shall accept comments from the authorized local
agencies and governmental entities.

D.
A
Each

local emergency medical services coordinating system shall develop a regional
emergency medical services plan that includes a needs assessment and
shall
submit the plan to the director
, the
speaker of the house of representatives, the president of the senate
and

to
the authorized local agencies within the
area. The
department shall integrate the
regional
plans
shall be integrated
into the statewide plan
by the department
.

E. The
state

statewide
plan shall contain a budget component for funding local and
state emergency medical services systems from the emergency medical services
operating fund established
pursuant to
by

section 36-2218 based on the needs assessment of the local emergency
medical services coordinating system plans. The components shall be
included in the department's budget through the normal appropriation process.
END_STATUTE

Sec. 2. Section 36-2217, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2217.

Exemption from regulation

A. This chapter does not apply to:

1. Vehicles used for the emergency transportation of
persons injured at an industrial site.

2. Persons engaged in and vehicles used for air
transportation of sick or injured people in a noncritical or nonemergency
situation as determined by a physician.

3. Medical evacuation equipment used and owned by
the department of public safety in air, ground or water evacuation
,

and
including fixed wing aircraft,
helicopters, ground ambulances and similar ground conveyances, snowmobiles and
water traversing equipment.

4. Vehicles provided or contracted for emergency
medical services by a political subdivision if these vehicles are primarily
used to provide on the scene stabilization of sick, injured, wounded,
incapacitated or helpless persons.

5. Ambulances from other states that are:

(a) Responding to a major catastrophe or emergency
in this state because there are insufficient registered ambulances in this
state to respond in that situation.

(b)
Either
operating
either
from a location outside of this state to transport a
patient to a location within this state or operating from a location outside of
this state and crossing through this state to transport a patient to a location
outside this state.

6. Registered
ambulances from this state that are responding to a major catastrophe,
natural disaster or wildland fire event in this state because there
are insufficient registered ambulances in the area affected by the major
catastrophe,
natural disaster or wildland fire event.

6.
7.
Stretcher
vans that meet the requirements of section 36-2223.

B. Except as provided in subsection A, paragraph 5,
subdivision (a) of this section, an ambulance from another state shall not pick
up a patient in this state and transport that patient to another location in
this state unless that ambulance is registered under this chapter.
END_STATUTE

Sec. 3. Title 36, chapter 21.1, article 1,
Arizona Revised Statutes, is amended by adding section 36-2220.01, to read:

START_STATUTE
36-2220.01.

Ambulance services; information on calls; public availability;
civil penalty; definition

A. each ambulance service shall
provide the following information on a quarterly basis to the department in a
department-approved format, as applicable:

1. The emergency medical dispatch
classification for each call for service or interfacility transport.

2. For each Call for service for
which an ambulance is dispatched, the following information, as applicable:

(
a
) The
dispatch time.

(
b
) The staging
time.

(
c
) The
canceled time.

(
d
) The on-scene
time.

(
e
) The en
route time.

(
f
) The
hospital arrival time.

(
g
) The
hospital release time.

3.
If an
ambulance service provider made a request for assistance to another ambulance
service provider, the date and time
of any instance in
which an ambulance service declined to provide mutual aid to another
certificate of necessity holder and an explanation why the request
for assistance was declined.

4. the details of substantiated
complaints received from an individual or health care institution as prescribed
in rule by the department.

5. The details of any medication
error that results in patient injury or patient death.

6. Any unintended injury or harm to a
patient that occurred WHILE providing prehospital care.

B. The department shall make the
information received pursuant to subsection A of this section available to the
public on request, except that the department shall redact any personally
identifying information. The department shall post the information received
pursuant to subsection a of this section, as redacted, on the department's
public website.

C. If an ambulance service fails to
comply with the quarterly reporting requirements of this section, the
department shall issue a notice to comply to the ambulance service within
thirty calendar days AFTER the end of the quarter. �The ambulance has fifteen
calendar days after receiving the notice to comply with the quarterly reporting
requirements of this section. �If the ambulance service continues to fail to
comply with the quarterly reporting requirements of this section, the director
may impose a civil penalty of not more than $500.

D. For the purposes of this section,
"emergency medical dispatch classification" means the standardized
system used by emergency medical dispatchers to evaluate and categorize
emergency medical calls based on the nature and severity of the incident.

END_STATUTE

Sec. 4. Section 36-2232, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2232.

Director; powers and duties; regulation of ambulance services;
inspections; response time compliance; mileage rate calculation factors; online
portal and dashboard

A. The director shall adopt rules to regulate the
operation of ambulances and ambulance services in this state. �Each rule shall
identify all sections and subsections of this chapter under which the rule was
formulated. The rules shall provide for the department to do the
following:

1. Consistent with the requirements of subsection H
of this section, determine, fix, alter and regulate just, reasonable and
sufficient rates and charges for the provision of ambulances, including rates
and charges for advanced life support service, basic life support service,
patient loaded mileage, standby waiting, subscription service contracts and
other contracts for services related to the provision of
ambulances. The director shall inform all ambulance services of the
procedures and methodology used to determine ambulance rates or charges.

2. Ensure
that
evidence-based
quality patient care is the priority for decision-making.

3. Regulate operating and response times of
ambulances to meet the needs of the public and to ensure adequate
service. The rules adopted by the director for certificated
ambulance service response times shall include uniform standards for urban,
suburban, rural and wilderness geographic areas within the certificate of
necessity based on, at a minimum, population density and geographic and medical
considerations. The calculation of response times shall begin when the public
safety answering point contacts an ambulance service for dispatch and conclude
when the ambulance service arrives at the dispatched location. �On-scene
arrival times for response time measurement shall be documented by the
ambulance service using dispatch or global positioning system data, or a
combination of both, and kept on file. Response time data that is
compliant with the health insurance portability and accountability act of 1996
shall be filed annually with the department. When dispatch or global
positioning system connectivity is not available, the ambulance service shall
manually document on-scene arrival times for response time
measurement. The response time data shall be filed in a department-approved
format, and the department shall make the response time data publicly
available.

4. Review response times established pursuant to
paragraph 3 of this subsection with the ambulance service and update the
response times based on, at a minimum, population density and geographic and
medical considerations, and the financial impact on rates and charges, every
six years. One additional review each six-year period may be
requested by a city, town, fire district or fire authority whose jurisdictional
boundaries in whole or in part are within the service area of a certificate of
necessity or an existing certificate of necessity holder within the service
area of the certificate of necessity.

5. Determine, fix, alter and regulate bases of
operation. The director may issue a certificate of necessity to more
than one ambulance service within any base of operation. For the
purposes of this paragraph, "base of operation" means a service area
granted under a certificate of necessity.

6. Issue, amend, transfer, suspend or revoke
certificates of necessity under terms consistent with this article.

7. Prescribe a uniform system of accounts to be used
by ambulance services that conforms to standard accounting forms and principles
for the ambulance industry and generally accepted accounting principles.

8. Require the filing of an annual financial report
and other data. These rules shall require an ambulance service to file the
report with the department not later than one hundred eighty days after the
completion of its annual accounting period.

9. Regulate ambulance services in all matters
affecting services to the public to the end that this article may be fully
carried out.

10. Prescribe bonding requirements, if any, for
ambulance services
that are
granted authority to provide
any type of subscription service.

11. Offer technical assistance to ambulance services
to ensure compliance with the rules.

12. Offer technical assistance to ambulance services
in order to obtain or to amend a certificate of necessity.

13. Inspect, at a maximum of twelve-month
intervals, each ambulance registered pursuant to section 36-2212 to
ensure that the vehicle is operational and safe and that all required medical
equipment is operational. At the request of the provider, the
inspection may be performed by a facility approved by the
director. If a provider requests that the inspection be performed by
a facility approved by the director, the provider shall pay the cost of the
inspection.

B. The director may require any ambulance service
offering subscription service contracts to obtain a bond in an amount
determined by the director that is based on the number of subscription service
contract holders and to file the bond with the director to protect all
subscription service contract holders in this state
who
that
are covered under that subscription contract.

C.
An
Each

ambulance service shall:

1. Maintain, establish, add, move or delete
suboperation stations within its base of operation to ensure that the ambulance
service meets the established response times or those approved by the director
in a political subdivision contract.

2. Determine the operating hours of its suboperation
stations to provide for coverage of its base of operation.

3. Provide the department with a list of
suboperation station locations.

4. Notify the department not later than thirty days
after the ambulance service makes a change in the number or location of its
suboperation stations.

5.
Beginning January 1, 2024,

Install and maintain an electronic global positioning system monitoring device
in each vehicle that is used for transport to record on-scene arrival
times for response time measurement. The department
shall

may
provide a waiver on a department-approved form
to an ambulance service that can reasonably demonstrate it is unable to meet
the requirements of this paragraph
because at least thirty
percent of the service area does not have global positioning system coverage
.
A waiver issued pursuant to this paragraph expires on April 1 of each
year and may be renewed annually.

D. At any time, the director or the director's
agents may:

1. 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.

2. Conduct on-site inspections of facilities,
communications equipment, vehicles, procedures, materials and equipment.

3. Review the qualifications of ambulance
attendants.

E. If all ambulance services that have been granted
authority to operate within the same service area or that have overlapping
certificates of necessity apply for uniform rates and charges, the director may
establish uniform rates and charges for the service area.

F. In consultation with the medical director of the
bureau of
emergency medical services and trauma system, the
emergency medical services council and the medical direction commission, the
director of the department of health services shall establish protocols for
ambulance services to refer and advise a patient or transport a patient by the
most appropriate means to the most appropriate provider of medical services
based on the patient's condition. The protocols shall include triage
and treatment protocols that allow all classifications of emergency medical
care technicians responding to a person who has accessed 911, or a similar
public dispatch number, for a condition that does not pose an immediate threat
to life or limb to refer and advise a patient or transport a patient to the
most appropriate health care institution as defined in section 36-401
based on the patient's condition, taking into consideration factors including
patient choice, the patient's health care provider, specialized health care facilities
and local protocols.

G. The director, when reviewing an ambulance
service's response time compliance with its certificate of necessity, shall
consider in addition to other factors the effect of hospital diversion, delayed
emergency department admission and the number of ambulances engaged in response
or transport in the affected area.

H. The department shall incorporate all of the
following factors when calculating the proposed mileage rate:

1. The cost of licensure and registration of each
ground ambulance vehicle.

2. The cost of fuel.

3. The cost of ground ambulance vehicle maintenance.

4. The cost of ground ambulance vehicle repair.

5. The cost of tires.

6. The cost of ground ambulance vehicle insurance.

7. The cost of mechanic wages, benefits and payroll
taxes.

8. The cost of loan interest related to the ground
ambulance vehicles.

9. The cost of the weighted allocation of overhead.

10. The cost of ground ambulance vehicle
depreciation.

11. The cost of reserves for replacement of ground
ambulance vehicles and equipment.

I. The department shall:

1. Establish an online certificate of
necessity application portal to allow applicants to track the status of their
application and the applicable deadlines as prescribed in rule by the
department.

2. Make available to the public on
the department's public website a dashboard of ambulance service response times
that can be reviewed by call type and the percentage of calls that required
advanced life support services.

END_STATUTE

Sec. 5. Section 36-2233, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2233.

Certificate of necessity to operate an ambulance service;
application; notification of interested parties; exceptions; service areas

A. Any person wishing to operate an ambulance
service in this state shall apply to the department on a form prescribed by the
director for a certificate of necessity.

B. Within one hundred eighty days after receiving an
application for a certificate of necessity as prescribed in this section, the
director shall make a determination based on whether necessity for the
ambulance service is found to exist and the applicant meets the requirements of
subsection F of this section. If the director requests additional
information from the applicant after initial review, the applicant
shall have
has
thirty business days to
respond. On request, the director may give the applicant one
additional period of thirty business days to respond. �If the applicant fails
to respond to the director's request for additional information, the department
shall deem the initial or amended application withdrawn. An
application deemed withdrawn is not an appealable agency action pursuant to
title 41, chapter 6, article 10. The applicant may appeal a denial
only pursuant to section 36-2234. The one hundred eighty-day
period for the director to make the determination of necessity does not include
the time the applicant uses to respond to requests for additional information.

C. On receipt of an initial or amended application
for a certificate of necessity, the department shall post a notice of the
application on its website. �Within thirty days after the department posts a
notice pursuant to this subsection, any interested party may provide
information to the director on a form in a department-approved format for
consideration. If an interested party fails to respond to the notice
within sixty days in a department-approved format, the information may
not be considered during the review of the application.

D. For the purposes of this section, a city, town,
fire district, fire authority or tribal government whose jurisdictional
boundaries in whole or in part are within the service area of a certificate of
necessity, an existing certificate of necessity holder within the service area
of the certificate of necessity or a hospital that is licensed pursuant to
chapter 4 of this title and that is located within the service area of a
certificate of necessity is considered to be an interested party as a matter of
law.

E. All interested parties shall be notified of any
application for an initial or amended certificate of necessity within fifteen
days after the application is filed, within fifteen days after the application
is complete and within fifteen days after a decision by the
director. The director's decision pursuant to subsection F of
this section is final unless appealed pursuant to section 36-2234,
subsection A.

F. The director shall issue a certificate of
necessity if all of the following apply:

1. The director finds that public necessity requires
the service or any part of the service proposed by the applicant.

2. The director finds that the applicant is fit and
proper to provide the service.

3. The applicant has paid the appropriate fees
pursuant to section 36-2240.

4. The applicant has filed a surety bond pursuant to
section 36-2237.

g. The director may not require an
applicant to purchase equipment, ambulances or other vehicles before approving
the certificate of necessity if the applicant can demonstrate the ability to
provide all services required pursuant to a certificate of necessity issued
pursuant to this article.

G.
h.
A
certificate of necessity issued pursuant to subsection F of this section
shall be for all or part of the service proposed by the applicant as determined
necessary by the director for public convenience and necessity.

i. Notwithstanding any other requirement of this chapter to
the contrary, If a geographic area of a city, town or fire district has a
population of less than ten thousand persons and is not within the service area
of a certificate of necessity, the director may issue a certificate of
necessity to the city, town or fire district or a private ambulance service to
provide ambulance services to that geographic area if the city, town or fire
district or the private ambulance service
can demonstrate the ability to provide all services required pursuant
to a certificate of necessity issued pursuant to this article.

J. If a geographic area of a city,
town or fire district has a population of less than ten thousand persons and
has a current certificate of necessity holder that has not met the certificate
of necessity conditions for at least twelve months, the director may issue a
certificate of necessity to a city, town or fire district or private ambulance
service to provide ambulance services to that geographic area if the city, town
or fire district or private ambulance service can demonstrate the ability to
provide all services required pursuant to a certificate of necessity issued
pursuant to this article.

H.

K.
This section does not require a certificate of
necessity for:

1. Vehicles and persons that are exempt from a
certificate of registration pursuant to section 36-2217.

2. Ambulance services operating under temporary
authority pursuant to section 36-2242.

I.

L.
The director may grant a service area by one or
any combination of the following descriptions:

1. Metes and bounds.

2. A city, town or political subdivision not limited
to a specific date. �The merger or consolidation of two or more fire districts
pursuant to section 48-820 or 48-822 does not expand the service
area boundaries of an existing certificate of necessity.

3. A city, town or political subdivision as of a
specific date that does not include annexation.
END_STATUTE

Sec. 6. Section 36-2234, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2234.

Hearings; waiver of hearing; appeals; emergency action;
suspension; judicial review; definition

A. The applicant or any certificate of necessity
holder whose ambulance service area in whole or in part is within the affected
service area of the initial or amended certificate of necessity may appeal
pursuant to title 41, chapter 6, article 10 the director's determination within
thirty days after the decision. If an appeal is made, the director
shall require
that
a public hearing be held within one
hundred twenty days after the hearing notice is issued on the director's
determination on the initial or amended certificate of necessity.

B. For the purposes of any hearing held pursuant to
this section, a city, town, fire district, fire authority or tribal government
whose jurisdictional boundaries in whole or in part are within the service area
of a certificate of necessity, an existing certificate of necessity holder
within the service area of the certificate of necessity or a hospital that is
licensed pursuant to chapter 4 of this title and that is located within the
service area of a certificate of necessity is considered to be an interested
party as a matter of law.

C. The director shall require a public hearing on
any proposed action relating to an adjustment of general public rates, charges
or certificate of necessity transfers unless subsection E, G or
O
P
of this section applies.

D. An appeal pursuant to subsection A of this
section or a public hearing held pursuant to subsection C of this section shall
meet the following requirements:

1. The hearing shall be held pursuant to title 41,
chapter 6, article 10, except as specifically provided in this section.

2. The director shall mail notice of the hearing to
every ambulance service in the affected region and every interested party as
specified in subsection B of this section not later than fifteen days before
the hearing.

3. The director may mail notice to other persons who
the director determines are interested in the hearing.

4. In a hearing or rehearing conducted pursuant to
this article, an ambulance service may be represented by a corporate officer,
an employee or a designee who has been specifically authorized by the ambulance
service to represent it.

5. For an appeal pursuant to
subsection A of this section, an ambulance service in the affected region and
each interested party as specified in subsection B of this section have seven
days after receiving the hearing notice mailed pursuant to paragraph 2 of this
subsection to intervene.

5.
6.
A
certificate of necessity appeal hearing may not last more than five consecutive
business days unless the administrative law judge determines, in writing, on
the final day of the hearing that there is an extraordinary need for additional
hearing days. The administrative law judge in that case may add up
to five additional consecutive business days for the hearing. �The additional
hearing days shall be calendared within thirty days after the end of the
initial hearing.

6.
7.
The
administrative law judge of the office of administrative hearings shall issue a
written decision within twenty days after the hearing is
concluded. The written decision shall contain a concise explanation
of the reasons supporting the decision, including the findings of fact and
conclusions of law. The administrative law judge shall serve a copy
of the decision on the department and all parties to the action. �On request of
the department, the office of administrative hearings shall also transmit to
the department the record of the hearing as described in section 12-904. A
copy of the administrative law judge's decision is deemed sent on personal
delivery of the decision or five days after the decision is mailed to the
director.

7.
8.
Within
thirty days after the date the office of administrative hearings sends a copy
of the administrative law judge's decision to the department, the director
shall review the decision and accept, reject or modify the
decision. If the director rejects or modifies the decision, the
director must file with the office of administrative hearings and serve on all
parties a copy of the administrative law judge's decision with the director's
rejection or modification and a written justification setting forth the reasons
for the rejection or modification of each finding of fact or conclusion of law.
�If there is a rejection or modification of a conclusion of law, the written
justification shall be sent to the president of the senate and the speaker of
the house of representatives.

8.
9.
If
the director does not accept, reject or modify the administrative law judge's
decision within thirty days after the date the office of administrative
hearings sends a copy of the administrative law judge's decision to the
director, as evidenced by receipt of such action by the office of
administrative hearings on or before the thirtieth day, the office of
administrative hearings shall certify the administrative law judge's decision
as the final administrative decision.

9.
10.
The
decision entered as specifically provided by this subsection is the final
administrative decision.

E. The director may waive the hearing required under
subsection C of this section if notification, including a general description
of the proposed action of the department and the time and manner for any
interested person to request a hearing, is given and all of the following
apply:

1. Notification of the proposed action has been sent
to every ambulance service in the affected region not later than fifteen days
before the action.

2. The director has notified other persons who the
director determines are interested in the proposed action not later than
fifteen days before the action.

3. The director has published notice of the proposed
action in a newspaper of general circulation in the affected region at least
once each week for two consecutive weeks before the action is taken.

4. The director has received no requests within the
fifteen-day notification period for a hearing to be held on the proposed
action.

F. If the director receives a request pursuant to
subsection E, paragraph 4 of this section, the director shall hold a hearing in
compliance with subsection D of this section.

G. The director shall not hold a hearing if a person
requests a hearing regarding a rate increase that does not exceed the amount
computed as follows:

1. Determine the percentage growth in the
transportation consumer price index of the United States department of labor,
bureau of labor statistics, from the end of the second preceding calendar year
to the calendar year immediately preceding the calendar year for which the rate
increase is requested.

2. Determine the percentage growth in the medical
care consumer price index of the United States department of labor, bureau of
labor statistics, from the end of the second preceding calendar year to the
calendar year immediately preceding the calendar year for which the rate
increase is requested.

3. Add the amount determined in paragraph 1 of this
subsection to the amount determined in paragraph 2 of this subsection and
divide the sum by two.

H. A rate increase authorized pursuant to subsection
G of this section is deemed to be fixed by the department at the requested
level. Notwithstanding subsection E of this section, the department shall hold
a hearing pursuant to section 36-2232, subsection E for any proposed
uniform rate or charge that exceeds the annual rate increase prescribed in
subsection G of this section. The department shall require the
applicants to submit the following information signed by the designated
financial officer and the chief executive of the ambulance service who has
fiduciary responsibility for providing accurate financial information:

1. A financial statement for the previous twenty-four
months relating to the certificated areas.

2. Any additional information the department
requires to analyze the request.

I. If an ambulance service with an established
general public rate applies for a contract rate or range of rates that is up to
thirty percent less than its established rate, the director shall grant the
rate without a public hearing or waiver, and without any right of intervention,
unless within ninety days after the filing of a completed application the
director determines that the contract rate or range of rates applied for does
not accurately reflect the cost and economics of providing the contract services,
would adversely affect the service available to the general public in the area
of service as designated by its certificate of necessity or would cause any
fixed rate, fare or charge to the general public to be adversely affected.

J. If the department disallows a proposed contract
rate pursuant to subsection I of this section, the ambulance service has a
right to a hearing for review of the proposed contract rate or range of rates.

K. The director may adopt rules for the
establishment of a contract rate or range of rates that may be implemented and
that exceeds the thirty percent rate variance identified pursuant to subsection
I of this section.

L. Subsections I, J and K of this section are
limited to contract rates or a range of rates applied for prescheduled,
interfacility or convalescent transports.

M. A service contract
between an ambulance service and a political subdivision of this state,
including local fire districts, shall be filed with and approved by the
department in accordance with the following requirements:

1. On receipt of the
proposed contract, the department has fifteen days to review the contract and
notify the ambulance service of any additional information the department
requires, recommended corrections or any provision that does or may violate
this article.

2. The ambulance service has fifteen days to provide
the department with the information requested or to submit a revised or amended
contract if required under paragraph 1 of this subsection.

3. The contract becomes effective fifteen days after
the ambulance service complies with the department's request unless the
department determines that any rate or charge or other provisions specified in
the contract will cause any fixed rate or charge to the general public rate to
be adversely affected or the contract would be in violation of the ambulance
service's certificate of necessity.

4. If the department disallows a proposed contract
pursuant to this subsection, the ambulance service has a right to a hearing for
review of the proposed contract.

5. The rates and charges contained in the contract
are the rates and charges fixed by the director in a decision or order for the
ambulance service and conform to the ambulance service's current or subsequent
general public rates and charges.

6. The area of response is within the ambulance
service's certificated area.

N. In case of emergency, the director may take
action providing for immediate suspension of a certificate of registration or a
certificate of necessity, or both, under this section without notice or a
hearing if the director determines that a potential threat to the public health
and safety exists. If such an action is taken by the director, the
director shall conduct a hearing within ten days after the date of the
director's action unless the person against whom the action is directed waives
the right to have a hearing held within ten days. If the ten-day
hearing requirement is waived, the director shall set a date mutually agreeable
to the interested parties. The purpose of the hearing is to review
the decision of the director to take such an action. The director
shall make findings of fact and may continue, suspend or modify the director's
action.

O. The director shall assess a civil
penalty of $1,500 on an ambulance service if the ambulance service is not
complying with the certificate of necessity's requirements. The
certificate of necessity holder may appeal the director's decision pursuant to
this subsection by requesting a hearing pursuant to title 41, chapter 6,
article 10.

O.
P.
The
director shall waive the hearing required under subsection C of this section if
geographic changes in suboperation stations do not alter the service area or
adversely affect approved response times.

P.
Q.
Except
as provided in section 41-1092.08, subsection H, a final decision of the
director relating to an adjustment of general public rates, charges or
certificate of necessity transfers is subject to judicial review pursuant to
title 12, chapter 7, article 6.

Q.
R.
The
final administrative decision of the director or the administrative law judge
as prescribed in subsection D of this section for an initial or amended
certificate of necessity is subject to judicial review pursuant to title 12,
chapter 7, article 6.

R.
S.
For
the purposes of this section, "hearing day":

1. Means any portion of a business day that is used
for any hearing-related activity, including testimony, argument or
presentation of evidence.

2. Does not include prehearing conferences or other
administrative matters that occur before the start of the hearing.
END_STATUTE

Sec. 7. Section 36-2235, Arizona Revised
Statutes, is amended to read:

START_STATUTE
36-2235.

Terms of certificates of necessity; initial term; renewal

A. The initial certificate of necessity issued
pursuant to section 36-2233 to each ambulance service shall be for a term
of one year.

B. On the expiration of a certificate of necessity,
if the holder of the certificate

of necessity

meets all requirements, applies for a renewal and pays the fees prescribed in
section 36-2240, the director shall renew the certificate

of necessity
for a term of three years without public hearing or waiver
unless cause is shown to set a hearing to consider denial or renewal for a
shorter term.

C. If the director does not conclude a hearing to
show cause within ninety days of the expiration date of the certificate
of necessity
, the certificate
of necessity
shall
be renewed for a period of
not less than
at
least
one year. The term of the certificate
of
necessity
shall be
extended to

renewed for
three years if the director determines that cause is not
established for denial or renewal for a shorter term. For the
purposes of this subsection, "hearing to show cause" means a hearing
ordered by the director pursuant to section 36-2245 to determine
if
whether
any grounds exist to prevent an
ambulance service from carrying out
the provisions of

subsection B of this section during the current term of the certificate
of necessity
.

D. The director shall base all
decisions relating to the renewal of a certificate of necessity on current
data.

END_STATUTE

Sec. 8. Section 36-2236, Arizona Revised Statutes, is amended to read:

START_STATUTE
36-2236.

Certificates of necessity; nature; transfer; suspension; service
area; population changes

A. A certificate of
necessity issued pursuant to this article is not a franchise, may be revoked by
the director and does not confer a property right on its holder.

B. A certificate of necessity shall not be assigned
or otherwise transferred without the written approval of the
director. When any certificate
of necessity
is
assigned or transferred, the director shall issue to the assignee or transferee
a new certificate
of necessity
that is valid only for the
unexpired term of the transferred or assigned certificate
of
necessity
.

C. In case of emergency, the director may suspend a
certificate of necessity as provided in section 36-2234.

D. If a certificate of necessity issued pursuant to
this article is issued to a city, town, fire district, fire authority or other
political subdivision of this state, the service area shall be all the
geographic area lying within the jurisdictional boundaries of the city, town,
fire district, fire authority or political subdivision, unless the certificate
of necessity
issued by the director specifically excludes a
portion of the city, town, fire district, fire authority or political
subdivision or includes an additional service area outside the jurisdictional
boundaries of the city, town, fire district, fire authority or other political
subdivision. If the jurisdictional boundaries of a city, town, fire
district, fire authority or other political subdivision expand, the service
area in the certificate of necessity expands to reflect those jurisdictional
boundaries, except as prescribed in section 36-2233, subsection
I

L
, paragraph
2. This subsection does not affect the validity of any previously
granted certificate
of necessity
for an unincorporated
area lying within the boundaries of a city.

E. If the population of a service area changes by
ten percent or more based on the most recent decennial census or five-year
census estimate, the department must conduct a review to determine whether
adjustments must be made to the response times in the service area, taking into
consideration the impact on rates and charges.
END_STATUTE