special plate; police foundation

SB1274 - 572R - H Ver

House Engrossed
Senate Bill

special
plate; police foundation

(now:� licensure;
timeshare salespersons)

State of Arizona

Senate

Fifty-seventh Legislature

Second Regular Session

2026

SENATE BILL 1274

AN
ACT

Amending sections 32-2101, 32-2122,
32-2124, 32-2125.01 and 32-2130, Arizona Revised Statutes;
amending title 32, chapter 20, article 2, Arizona Revised Statutes, by adding
section 32-2134.02; amending section 32-2153, Arizona Revised
Statutes; Relating to timeshare sales.

(TEXT OF BILL BEGINS ON NEXT PAGE)

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

Section 1. Section 32-2101, Arizona Revised Statutes,
is amended to read:

START_STATUTE
32-2101.

Definitions

In this chapter, unless the context otherwise requires:

1. "Acting in concert" means evidence of
collaborating to pursue a concerted plan.

2. "Address of record" means any of the
following:

(a) The address where a licensee practices or is
otherwise employed.

(b) A licensee's residential address.

(c) The address of a licensee's statutory agency who
is registered as the licensee's statutory agent with the corporation
commission. This subdivision applies only if notice of the statutory
agent is given to the department pursuant to section 32-2126.

3. "Advertising" means attempting by
publication, dissemination, exhibition, solicitation or circulation, oral or
written, or for broadcast on radio or television to induce directly or
indirectly any person to enter into any obligation or acquire any title or
interest in lands subject to this chapter, including the land sales contract to
be used and any photographs, drawings or artist's presentations of physical
conditions or facilities existing or to exist on the property.� Advertising
does not include:

(a) Press releases or other communications delivered
to newspapers, periodicals or other news media for general information or
public relations purposes if no charge is made by the newspapers, periodicals
or other news media to publish or use any part of these communications.

(b) Communications to stockholders as follows:

(i) Annual reports and interim financial reports.

(ii) Proxy materials.

(iii) Registration statements.

(iv) Securities prospectuses.

(v) Applications for listing of securities on stock
exchanges.

(vi) Prospectuses.

(vii) Property reports.

(viii) Offering statements.

4. "Affiliate" means a person who,
directly or indirectly through one or more intermediaries, controls, is
controlled by or is under common control with the person specified.

5. "Associate broker" means a licensed
broker who is employed by another broker. Unless otherwise
specifically provided, an associate broker has the same license privileges as a
salesperson.

6. "Barrier" means a natural or man-made
geographic feature that prevents parcels of land from being practicably,
reasonably and economically united or reunited and that was not caused or
created by the owner of the parcels.

7. "Blanket encumbrance":

(a) Means either:

(i) Any mortgage, any deed of trust or any other
encumbrance or lien that secures or evidences the payment of monies and that
affects more than one lot or parcel of subdivided land.

(ii) An agreement that affects more than one lot or
parcel by which the subdivider holds the subdivision under an option, contract
to sell or trust agreement.

(b) Does not include taxes and assessments that are
levied by public authority.

8. "Board" means the real estate advisory
board.

9. "Broker", when used without
modification, means a person who is licensed as a broker under this chapter or
who is required to be licensed as a broker under this chapter.

10. "Business broker" means a real estate
broker who acts as an intermediary or agent between sellers or buyers, or both,
in the sale or purchase, or both, of businesses or business opportunities where
a lease or sale of real property is either a direct or incidental part of the
transaction.

11. "Camping site" means a space that is
designed and promoted for the purpose of locating any trailer, tent, tent
trailer, pickup camper or other similar device used for camping.

12. "Cemetery" or "cemetery
property" means any one, or a combination of more than one, of the
following in a place that is used, or intended to be used, and dedicated for
cemetery purposes:

(a) A burial park, for earth interments.

(b) A mausoleum, for crypt or vault entombments.

(c) A crematory, or a crematory and columbarium, for
cinerary interments.

(d) A cemetery plot, including interment rights,
mausoleum crypts, niches and burial spaces.

13. "Cemetery broker" means a person other
than a real estate broker or real estate salesperson who, for another, for
compensation:

(a) Sells, leases or exchanges cemetery property or
interment services of or for another, or on the person's own account.

(b) Offers for another or for the person's own
account to buy, sell, lease or exchange cemetery property or interment
services.

(c) Negotiates the purchase and sale, lease or
exchange of cemetery property or interment services.

(d) Negotiates the purchase or sale, lease or
exchange, or lists or solicits, or negotiates a loan on or leasing of cemetery
property or interment services.

14. "Cemetery salesperson" means a natural
person who acts on the person's own behalf or through and on behalf of a
professional limited liability company or a professional corporation engaged by
or on behalf of a licensed cemetery or real estate broker, or through and on
behalf of a corporation, partnership or limited liability company that is
licensed as a cemetery or real estate broker, to perform any act or transaction
included in the definition of cemetery broker.

15. "Commissioner" means the state real
estate commissioner.

16. "Common promotional plan" means a
plan, undertaken by a person or a group of persons acting in concert, to offer
lots for sale or lease. If the land is offered for sale by a person or group of
persons acting in concert, and the land is contiguous or is known, designated
or advertised as a common unit or by a common name, the land is presumed,
without regard to the number of lots covered by each individual offering, as
being offered for sale or lease as part of a common promotional
plan. Separate subdividers selling lots or parcels in separately
platted subdivisions within a master planned community shall not be deemed to
be offering their combined lots for sale or lease as part of a common
promotional plan.

17. "Compensation" means any fee,
commission, salary, monies or other valuable consideration for services
rendered or to be rendered as well as the promise of consideration whether
contingent or not.

18. "Contiguous":

(a) Means lots, parcels or fractional interests that
share a common boundary or point.

(b) Does not include lots, parcels or fractional
interests that are separated by either of the following:

(i) A barrier.

(ii) A road, street or highway that has been
established by this state or by any agency or political subdivision of this
state, that has been designated by the federal government as an interstate
highway or that has been regularly maintained by this state or by any agency or
political subdivision of this state and has been used continuously by the
public for at least the last five years.

19. "Control" or "controlled"
means a person who, through ownership, voting rights, power of attorney, proxy,
management rights, operational rights or other rights, has the right to make
decisions binding on an entity, whether a corporation, a partnership or any
other entity.

20. "Corporation licensee" means a
lawfully organized corporation that is registered with the corporation
commission and that has an officer licensed as the designated broker pursuant
to section 32-2125.

21. "Department" means the state real
estate department.

22. "Designated broker" means a natural
person who is licensed as a broker under this chapter and who is either:

(a) Designated to act on behalf of an employing real
estate, cemetery or membership camping entity.

(b) Doing business as a sole proprietor.

23. "Developer":

(a) Means a person who offers real property in a
development for sale, lease or use, either immediately or in the future, on the
person's own behalf or on behalf of another person, under this chapter.

(b) Does not include a person whose involvement with
a development is limited to listing property within the development for sale,
lease or use.

24. "Development" means any division,
proposed division or use of real property that the department has authority to
regulate, including subdivided and unsubdivided lands, cemeteries,
condominiums, timeshares, membership campgrounds and stock cooperatives.

25. "Distance learning" means continuing
education or prelicensure education that is an online, planned learning
experience with a geographic separation that may be synchronous or
asynchronous, that does not require real-time interaction between a
student and an instructor and that uses a platform with self-paced or
prerecorded lessons and materials that a student can access via the internet to
proceed at the student's own pace.

26. "Employing broker" means a person who
is licensed or is required to be licensed as a:

(a) Broker entity pursuant to section 32-2125,
subsection A.

(b) Sole proprietorship if the sole proprietor is a
broker licensed pursuant to this chapter.

27. "Fractional interest" means an
undivided interest in improved or unimproved land, lots or parcels of any size
created for the purpose of sale or lease and evidenced by any receipt,
certificate, deed or other document conveying the interest. Undivided interests
in land, lots or parcels created in the names of a husband and wife as
community property, joint tenants or tenants in common, or in the names of
other persons who, acting together as part of a single transaction, acquire the
interests without a purpose to divide the interests for present or future sale
or lease shall be deemed to constitute only one fractional interest.

28. "Improved lot or parcel" means a lot
or parcel of a subdivision on which there is a residential, commercial or
industrial building or concerning which a contract has been entered into
between a subdivider and a purchaser that obligates the subdivider directly, or
indirectly through a building contractor, to completely construct a
residential, commercial or industrial building on the lot or parcel within two
years after the date on which the contract of sale for the lot is entered into,
or for a condominium as defined in section 33-1202, within four years
after the date on which the contract for sale is entered into.

29. "Inactive
license" means a license that is issued pursuant to article 2 of this
chapter to a licensee who is on inactive status during the current license
period and who is not engaged by or on behalf of a broker.

30. "Lease" or "leasing"
includes any lease, whether it is the sole, the principal or any incidental
part of a transaction.

31. "License" means the whole or part of
any agency permit, certificate, approval, registration, public report, charter
or similar form of permission required by this chapter.

32. "Licensee" means a person to whom a
license for the current license period has been granted under any provision of
this chapter, and, for the purposes of section 32-2153, subsection A,
includes original license applicants.

33. "License period" means the two-year
period beginning with the date of original issue or renewal of a particular
license and ending on the expiration date, if any.

34. "Limited liability company licensee"
means a lawfully organized limited liability company that has a member or
manager who is a natural person and who is licensed as the designated broker
pursuant to section 32-2125.

35. "Live classroom course" means a course
or instructional segment delivered in either an in-person classroom
instructional format or a synchronous remote instructional format that allows
students to observe and participate remotely in an instructional segment via
livestreaming.

36. "Lot reservation" means an expression
of interest by a prospective purchaser in buying at some time in the future a
subdivided or unsubdivided lot, unit or parcel in this state. In all
cases, a subsequent affirmative action by the prospective purchaser must be
taken to create a contractual obligation to purchase.

37. "Master planned community" means a
development that consists of two or more separately platted subdivisions and
that is either subject to a master declaration of covenants, conditions or
restrictions, is subject to restrictive covenants sufficiently uniform in
character to clearly indicate a general scheme for improving or developing real
property or is governed or administered by a master owner's association.

38. "Member" means a member of the real
estate advisory board.

39. "Membership camping broker" means a
person, other than a salesperson, who, for compensation:

(a) Sells, purchases, lists, exchanges or leases
membership camping contracts.

(b) Offers to sell, purchase, exchange or lease
membership camping contracts.

(c) Negotiates or offers, attempts or agrees to
negotiate the sale, purchase, exchange or lease of membership camping
contracts.

(d) Advertises or holds himself out as being engaged
in the business of selling, buying, exchanging or leasing membership camping
contracts or counseling or advising regarding membership camping contracts.

(e) Assists or directs in procuring prospects
calculated or intended to result in the sale, purchase, listing, exchange or
lease of membership camping contracts.

(f) Performs any of the foregoing acts as an
employee or on behalf of a membership camping operator or membership contract
owner.

40. "Membership camping contract" means an
agreement that is offered or sold in this state evidencing a purchaser's right
or license to use the camping or outdoor recreation facilities of a membership
camping operator and includes a membership that provides for this use.

41. "Membership camping operator":

(a) Means an enterprise, other than one that is tax
exempt under section 501(c)(3) of the internal revenue code of 1986, as
amended, that solicits membership paid for by a fee or periodic payments and
has as one of its purposes camping or outdoor recreation, including the use of
camping sites primarily by members.

(b) Does not include camping or recreational trailer
parks that are open to the general public and that contain camping sites rented
for a per use fee or a mobile home park.

42. "Membership camping salesperson" means
a natural person who acts on the person's own behalf or through and on behalf
of a professional limited liability company or a professional corporation
engaged by or on behalf of a licensed membership camping or real estate broker,
or by or on behalf of a corporation, partnership or limited liability company
that is licensed as a membership camping or real estate broker, to perform any
act or participate in any transaction in a manner included in the definition of
membership camping broker.

43. "Partnership licensee" means a
partnership with a managing general partner who is licensed as the designated
broker pursuant to section 32-2125.

44. "Permanent access", as required under
article 4 of this chapter, means permanent access from the subdivision to any
federal, state or county highway.

45. "Perpetual care" or "endowed
care":

(a) Means maintaining and caring, in all places
where interments have been made, for the trees, shrubs, roads, streets and
other improvements and embellishments contained within or forming a part of the
cemetery.

(b) Does not include maintaining or repairing
monuments, tombs, copings or other man-made ornaments as associated with
individual burial spaces.

46. "Perpetual or endowed-care
cemetery" means a cemetery in which lots or other burial spaces are sold
or transferred under the representation that the cemetery will receive
perpetual care or endowed care free of further cost to the purchaser after
payment of the original purchase price for the lot, burial space or interment
right.

47. "Person" means any individual,
corporation, partnership or company and any other form of multiple organization
for carrying on business, foreign or domestic.

48. "Private cemetery" means a cemetery or
place that is not licensed under article 6 of this chapter, where burials or
interments of human remains are made, in which sales or transfers of interment
rights or burial plots are not made to the public and in which not more than
ten interments or burials occur annually.

49. "Promotion" or "promotional
practice" means advertising and any other act, practice, device or scheme
to induce directly or indirectly any person to enter into any obligation or
acquire any title or interest in or use of real property subject to this
chapter, including meetings with prospective purchasers, arrangements for
prospective purchasers to visit real property, travel allowances and discount,
exchange, refund and cancellation privileges.

50. "Real estate" includes leasehold-interests
and any estates in land as defined in title 33, chapter 2, articles 1 and 2,
regardless of whether located in this state.

51. "Real estate broker" means a person,
other than a salesperson, who, for another and for compensation:

(a) Sells, exchanges, purchases, rents or leases
real estate, businesses and business opportunities or timeshare interests.

(b) Offers to sell, exchange, purchase, rent or
lease real estate, businesses and business opportunities or timeshare
interests.

(c) Negotiates or offers, attempts or agrees to
negotiate the sale, exchange, purchase, rental or leasing of real estate,
businesses and business opportunities or timeshare interests.

(d) Lists or offers, attempts or agrees to list real
estate, businesses and business opportunities or timeshare interests for sale,
lease or exchange.

(e) Auctions or offers, attempts or agrees to
auction real estate, businesses and business opportunities or timeshare
interests.

(f) Buys, sells, offers to buy or sell or otherwise
deals in options on real estate, businesses and business opportunities or
timeshare interests or improvements to real estate, businesses and business
opportunities or timeshare interests.

(g) Collects or offers, attempts or agrees to
collect rent for the use of real estate, businesses and business opportunities
or timeshare interests. This subdivision does not apply to a person
who is not a licensee, who works for a real estate broker or a real estate
salesperson, who collects in-person rent and related fees on behalf of the real
estate broker or real estate salesperson for the use of real estate as part of
the person's clerical duties and who provides a receipt when rent is paid.

(h) Advertises or holds himself out as being engaged
in the business of buying, selling, exchanging, renting or leasing real estate,
businesses and business opportunities or timeshare interests or counseling or
advising regarding real estate, businesses and business opportunities or
timeshare interests.

(i) Assists or directs in procuring prospects that
are calculated to result in the sale, exchange, leasing or rental of real
estate, businesses and business opportunities or timeshare interests.

(j) Assists or directs in negotiating any
transaction calculated or intended to result in the sale, exchange, leasing or
rental of real estate, businesses and business opportunities or timeshare
interests.

(k) Incident to the sale of real estate, businesses
and business opportunities negotiates or offers, attempts or agrees to
negotiate a loan secured or to be secured by any mortgage or other encumbrance
on or transfer of real estate, businesses and business opportunities or
timeshare interests subject to section 32-2155, subsection
D. This subdivision does not apply to mortgage brokers as defined in
and subject to title 6, chapter 9, article 1.

(l) Engages in the business of assisting or offering
to assist another in filing an application for the purchase or lease of, or in
locating or entering on, lands owned by the state or federal government.

(m) Claims, demands, charges, receives, collects or
contracts to collect an advance fee in connection with any employment
enumerated in this section, including employment undertaken to promote the sale
or lease of real property by advance fee listing, by furnishing rental
information to a prospective tenant for a fee paid by the prospective tenant,
by advertising or by any other offering to sell, lease, exchange or rent real
property or selling kits connected therewith.� This does not include the
activities of any communications media of general circulation or coverage not
primarily engaged in advertising real estate or any communications media
activities that are specifically exempt from applicability of this article
under section 32-2121.

(n) Engages in any of the acts listed in
subdivisions (a) through (m) of this paragraph for the sale or lease of other
than real property if a real property sale or lease is a part of, contingent on
or ancillary to the transaction.

(o) Performs any of the acts listed in subdivisions
(a) through (m) of this paragraph as an employee of, or in behalf of, the owner
of real estate, or interest in the real estate, or improvements affixed on the
real estate, for compensation.

(p) Acts as a business broker.

52. "Real estate sales contract" means an
agreement in which one party agrees to convey title to real estate to another
party on the satisfaction of specified conditions set forth in the contract.

53. "Real estate salesperson" means a
natural person who acts on the person's own behalf or through and on behalf of
a professional limited liability company or a professional corporation engaged
by or on behalf of a licensed real estate broker, or by or on behalf of a
limited liability company, partnership or corporation that is licensed as a
real estate broker, to perform any act or participate in any transaction in a
manner included in the definition of real estate broker subject to section 32-2155.

54. "Sale" or "lease" includes
every disposition, transfer, option or offer or attempt to dispose of or
transfer real property, or an interest, use or estate in the real property,
including offering the property as a prize or gift if a monetary charge or
consideration for whatever purpose is required.

55. "Salesperson", when used without modification,
means a natural person who acts on the person's own behalf or through and on
behalf of a professional limited liability company or a professional
corporation licensed under this chapter or any person required to be licensed
as a salesperson under this chapter.

56. "School" means a person or entity that
offers a course of study toward completion of the education requirements
leading to licensure or renewal of licensure under this chapter.

57. "Stock cooperative" means a
corporation to which all of the following apply:

(a) The corporation is formed or used to hold title
to improved real property in fee simple or for a term of years.

(b) All or substantially all of the shareholders of
the corporation each receive a right of exclusive occupancy in a portion of the
real property to which the corporation holds title.

(c) The right of occupancy may only be transferred
with the concurrent transfer of the shares of stock in the corporation held by
the person having the right of occupancy.

58. "Subdivider":

(a) Means any person who offers for sale or lease
six or more lots, parcels or fractional interests in a subdivision or who
causes land to be subdivided into a subdivision for the subdivider or for
others, or who undertakes to develop a subdivision.

(b) Does not include a public agency or officer
authorized by law to create subdivisions.

59. "Subdivision" or "subdivided
lands":

(a) Means improved or unimproved land or lands
divided or proposed to be divided for the purpose of sale or lease, whether
immediate or future, into six or more lots, parcels or fractional interests.

(b) Includes a stock cooperative, lands divided or
proposed to be divided as part of a common promotional plan and residential
condominiums as defined in title 33, chapter 9.

(c) Does not include:

(i) Leasehold offerings of one year or less.

(ii) The division or proposed division of land
located in this state into lots or parcels each of which is or will be thirty-six
acres or more in area including to the centerline of dedicated roads or
easements, if any, contiguous to the lot or parcel.

(iii) The leasing of agricultural lands or
apartments, offices, stores, hotels, motels, pads or similar space within an
apartment building, industrial building, rental recreational vehicle community,
rental manufactured home community, rental mobile home park or commercial
building.

(iv) The subdivision into or development of parcels,
plots or fractional portions within the boundaries of a cemetery that has been
formed and approved pursuant to this chapter.

(v) A sale or lease of a lot, parcel or fractional
interest that occurs ten or more years after the sale or lease of another lot,
parcel or fractional interest if the other lot, parcel or fractional interest
is not subject to this article and is treated as an independent parcel unless,
on investigation by the commissioner, there is evidence of intent to subdivide.

60. "Timeshare" or "timeshare
property" means real property ownership or right of occupancy in real
property pursuant to article 9 of this chapter. For the purposes of
this chapter, a timeshare is not a security unless it meets the definition of a
security under section 44-1801.

61. "Timeshare salesperson"
means a natural person who acts under the supervision of a licensed real estate
broker to sell or exchange timeshare properties on behalf of a timeshare plan
developer or other person.

61.

62.
"Trustee":

(a) Means a person who either:

(i) Is designated under section 32-2194.27 to
act as a trustee for an endowment-care cemetery fund.

(ii) Holds bare legal title to real property under a
subdivision trust.

(b) Does not include a developer, subdivider, broker
or salesperson within this chapter.

62.

63.
"Unimproved
lot or parcel" means a lot or parcel of a subdivision that is not an
improved lot or parcel.

63.

64.
"Unsubdivided lands":

(a) Means land or
lands divided or proposed to be divided for the purpose of sale or lease,
whether immediate or future, into six or more lots, parcels or fractional
interests and the lots or parcels are thirty-six acres or more each but
less than one hundred sixty acres each, or that are offered, known or
advertised under a common promotional plan for sale or lease, except that
agricultural leases shall not be included in this definition.

(b) Includes any land that is sold and that would otherwise
constitute the sixth lot, parcel or fractional interest if the sale occurs ten
or more years after the earliest of the previous five sales and if all of the
sales consist of property that was originally contained within the same parcel
that is thirty-six acres or more and less than one hundred sixty acres.
END_STATUTE

Sec. 2. Section 32-2122, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-2122.

License required of brokers and salespersons

A. This article applies to any person acting in the
capacity of a:

1. Real estate broker.

2. Real estate salesperson.

3. Cemetery broker.

4. Cemetery salesperson.

5. Membership camping broker.

6. Membership camping salesperson.

7. timeshare salesperson.

B. It is unlawful for any person, corporation,
partnership or limited liability company to engage in any business, occupation
or activity listed in subsection A of this section without first obtaining a
license as prescribed in this chapter and otherwise complying with this
chapter.

C. A person, corporation, partnership or limited
liability company that is licensed as a salesperson or broker pursuant to this
article or that is engaging in any work for which a license is required under
this article is subject to the requirements of this chapter in performing any
acts included in the definition of a broker unless otherwise provided in this
chapter.

D. Except as otherwise provided in this subsection,
any act, in consideration or expectation of compensation, that is included in
the definition of a real estate broker, cemetery broker or membership camping
broker, whether the act is an incidental part of a transaction or the entire
transaction, constitutes the person offering or attempting to perform the act
of a real estate broker or real estate salesperson, a cemetery broker or
cemetery salesperson
, a timeshare salesperson
or a
membership camping broker or
a
membership camping
salesperson within the meaning of this chapter. A person who is not
a licensee may collect in-person rent and related fees for the use of
real estate as part of the person's clerical duties if the person works for a
licensee, the rent collection is on behalf of the licensee and the person
provides a receipt when rent is paid.
END_STATUTE

Sec. 3. Section 32-2124, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-2124.

Qualifications of licensees

A. Except as otherwise provided in this chapter, the
commissioner shall require proof, through the application or otherwise, as the
commissioner deems advisable with due regard to the interests of the public, as
to the competency of the applicant and shall require that the applicant has:

1. If for an original real estate broker's license,
been an active licensed real estate salesperson or real estate broker for at
least three years during the five years immediately preceding the time of
application.

2. If for an original cemetery broker's license,
either a current real estate broker's license, or if the applicant does not
have a current real estate broker's license, at least three years' actual
experience as a cemetery salesperson or cemetery broker or as a licensed real
estate salesperson or licensed real estate broker during the five years
immediately preceding the time of application.

3. If for an original membership camping broker's
license, either a current real estate broker's license, or if the applicant
does not have a current real estate broker's license, at least three years'
actual experience as a licensed membership camping salesperson or licensed
membership camping broker or as a licensed real estate salesperson or licensed
real estate broker during the five years immediately preceding the time of
application.

4. If for any type of broker's or salesperson's
license, not had a license denied within one year immediately preceding
application in this state pursuant to section 32-2153 or a similar
statute in any other state.

5. If for any type of broker's or salesperson's
license, not had a license revoked within the two years immediately preceding
application in this state pursuant to section 32-2153 or a similar
statute in any other state.

6. If reapplying for a license that expired more
than one year before the date of application, met all current education and
experience requirements and retakes the examination the same as if the
applicant were applying for the license for the first time.

7. If for a real estate broker's, cemetery broker's
or membership camping broker's license, other than a renewal application, an
equivalent amount of active experience within the immediately preceding five
years in the field in which the applicant is applying for the broker's license,
as a substitute for the licensed active experience otherwise required in
paragraphs 1, 2 and 3 of this subsection. The licensed active
experience required may be met if the applicant can demonstrate to the
commissioner's satisfaction that the applicant has an equivalent amount of
experience in the past five years that, if the applicant had held a license,
would have been sufficient to fulfill the licensed experience requirement.

B. All
applicants other than renewal applicants under section 32-2130 for a real
estate salesperson's license shall show evidence satisfactory to the
commissioner that they have completed a real estate salesperson's course that
is prescribed and approved by the commissioner and that is at least ninety
classroom hours, or the equivalent, of instruction in a real estate school
certified by the commissioner and have satisfactorily passed an examination on
the course. An applicant may complete the real estate salesperson's
course prescribed by this subsection through a live classroom course or a
distance learning course if the live classroom course or distance learning
course is offered by a real estate school that is certified by the
commissioner.� The applicant must complete a proctored examination on the live
classroom course or the distance learning course in person. An
applicant may complete the required course or instructional segments in any
combination of in-person or synchronous remote delivery methods. The
real estate salesperson's course completion or its equivalent may not be more
than ten years before the date of application unless, at the time of
application, the commissioner determines in the commissioner's discretion that
the applicant has work experience in a real estate-related field and
education that together are equivalent to the prelicensure education
requirement. Except as provided in section 32-4302, the
commissioner may waive all or a portion of the prelicensure course requirement,
other than the twenty-seven-hour Arizona-specific course, for an
applicant who holds a current real estate license in another state.

C. All applicants other than renewal applicants
under section 32-2130 for a real estate broker's license shall show
evidence satisfactory to the commissioner that they have completed a real
estate broker's course that is prescribed and approved by the commissioner and
that is at least ninety classroom hours, or the equivalent, of instruction in a
real estate school certified by the commissioner and have satisfactorily passed
an examination on the course. An applicant may complete the real
estate broker's course prescribed by this subsection through a live classroom
course or a distance learning course if the live classroom course or distance
learning course is offered by a real estate school that is certified by the
commissioner.� The applicant must complete a proctored examination on the live
classroom course or distance learning course in person.� An applicant may
complete the required course or instructional segments in any combination of in-person
or synchronous remote delivery methods.� The real estate broker's course
completion or its equivalent may not be more than ten years before the date of
application unless, at the time of application, the commissioner determines in
the commissioner's discretion that the applicant has work experience in a real estate-related
field and education that together are equivalent to the prelicensure education
requirement. Except as provided in section 32-4302, the
commissioner may waive all or a portion of the prelicensure course requirement,
other than the twenty-seven-hour Arizona-specific course, for
an applicant who holds a current real estate license in another state.

D. Before receiving any license provided for by this
chapter, an applicant must be at least eighteen years of age.

E. The commissioner shall ascertain by a written,
electronic or other examination method that an applicant for a real estate
license has:

1. An appropriate knowledge of the English language,
including reading, writing and spelling, and of arithmetical computations
common to real estate practices.

2. At a minimum, an understanding of the general
purpose and legal effect of any real estate practices, principles and related
forms, including agency contracts, real estate contracts, deposit receipts,
deeds, mortgages, deeds of trust, security agreements, bills of sale, land
contracts of sale and property management, and of any other areas that the
commissioner deems necessary and proper.

3. A thorough understanding of the obligations
between principal and agent, the principles of real estate and business
opportunity practice, the applicable canons of business ethics, this chapter
and rules adopted pursuant to this chapter.

4. An appropriate knowledge of other real estate
practices and principles as determined by the commissioner.

F. The commissioner shall ascertain by a written,
electronic or other examination method that an applicant for a license as a
cemetery broker or a cemetery salesperson has:

1. Appropriate knowledge of the English language,
including reading, writing and spelling, and of elementary arithmetic.

2. A general understanding of:

(a) Cemetery associations, cemetery corporations and
duties of cemetery directors and officers.

(b) Plot ownership, deeds, certificates of
ownership, contracts of sale, liens and leases.

(c) Establishing, dedicating, maintaining, managing,
operating, improving, preserving and conducting a cemetery.

(d) The provisions of this chapter and rules adopted
pursuant to this chapter relating to the organization and regulation of
cemeteries and the licensing and regulation of cemetery brokers and cemetery
salespersons.

3. A general understanding of the obligations
between principal and agent, the principles of cemetery practice and the canons
of business ethics pertaining to the operation of cemeteries and the sale of
cemetery property.

G. The commissioner shall ascertain by a written,
electronic or other examination method that an applicant for a license as a
membership camping broker or a membership camping salesperson has:

1. An appropriate knowledge of the English language,
including reading, writing and spelling, and of elementary arithmetic.

2. A general understanding of:

(a) The general purposes and legal effect of
contracts and agency contracts.

(b) Establishing, maintaining, managing and
operating a membership campground.

(c) The provisions of this chapter and rules adopted
pursuant to this chapter relating to the organization and regulation of
membership campgrounds and the licensing and regulation of membership camping
brokers and membership camping salespersons.

3. A general understanding of the obligations
between principal and agent and the canons of business ethics pertaining to the
operation and promotion of membership campgrounds.

H. The commissioner may adopt rules
that specify the requirements of examination preparation courses for applicants
for timeshare salesperson licenses. The examination preparation
course and the timeshare examination shall be limited to those specific real
estate laws, regulations, business practices and canons of business ethics that
are directly related to the sale of timeshare interests in this state. The
commissioner shall ascertain by a written, electronic or other examination
method that an applicant for a license as a timeshare salesperson meets both of
the following:

1. Has an appropriate knowledge of
elementary arithmetic and of the English language, including reading, writing
and spelling.

2. Has a general understanding of all
of the following:

(
a
) The
provisions of this chapter and the rules adopted pursuant to this chapter that
relate to the development of timeshare properties, the organization and
regulation of timeshare properties, the sale or exchange of timeshare
properties, the licensing and regulation of timeshare salespersons and the role
of licensed real estate brokers in reviewing and approving timeshare sales or
exchanges.

(
b
) Timeshare
ownership methods, including deeds, certificates of ownership and contracts of
sale, leases of timeshare properties and liens and foreclosure of timeshare
interests.

(
c
) The canons
of business ethics pertaining to the operation of timeshare properties and the
sale and exchange of timeshare properties.

H.

I.
A
renewal applicant for a real estate broker's, cemetery broker's or membership
camping broker's or real estate salesperson's, cemetery salesperson's
,

or
membership camping salesperson's
or timeshare salesperson's
license is not required to submit
to an examination if the application is made within twelve months after the
license expires and the license is not canceled, terminated or suspended at the
time of application.

I.

j.
The
examination for a broker's license shall be more exacting and stringent and of
a broader scope than the examination for a salesperson's license.

J.

k.
An
applicant for a real estate salesperson's or real estate broker's license who
currently holds at least an equivalent license in another state is exempt from
taking the national portion of the real estate examination pursuant to section
32-4302.

K.

l.
Identification
of each applicant whose licensing requirement was allowed to be met by an
equivalent alternative pursuant to this section shall be included in the annual
performance evaluation presented by the board to the governor pursuant to
section 32-2104.

L.

M.
An
applicant for an original real estate salesperson's license, after completing
the requirements of subsection B of this section, shall provide certification
to the department at the time of application evidencing completion of six hours
of instruction in real estate contract law and contract
writing. This instruction shall include participation by the
applicant in drafting contracts to purchase real property, listing agreements
and lease agreements.

M.

n.
The
commissioner shall not issue a license to a person who has been convicted of a
felony offense and who is currently incarcerated for the conviction, paroled or
under community supervision and under the supervision of a parole or community supervision
officer or who is on probation as a result of the conviction.

N.

o.
The
commissioner shall require an out-of-state applicant for a license
that is issued pursuant to section 32-4302 to pass an examination
specific to the laws of this state relating to this chapter before the
commissioner issues the license to the applicant.
END_STATUTE

Sec. 4. Section 32-2125.01, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-2125.01.

Issuance of license; multiple licenses; use

A. When the requirements for application,
examination and payment of fees are completed to the satisfaction of the
commissioner, the commissioner shall issue the license applied for to the
applicant. Any person who has passed the state examination for
broker or salesperson must become licensed within one year
from
the date of the examination. Failure to comply
with this section will necessitate the submission to and passing of another
examination.

B. Not more than one license shall be issued and
outstanding to or in favor of a licensee at any one time, except that a person
who is
licensed as a real estate broker or real estate
salesperson may engage in cemetery
,

or

membership camping
or timeshare
sales activities without
being separately licensed to engage in these activities.� A real estate
licensee may have only one employing broker in each of the following
licensing
categories:

1. Cemetery.

2. Membership camping.

3. Real estate.

4. Timeshare.

C. A designated or employing real estate broker may
engage in cemetery or membership camping sales activities and may employ
cemetery
and

SALESPERSONs,

membership camping salespersons and associate brokers without being separately
licensed as a cemetery
or

broker, cemetery
salesperson,
membership camping broker or
membership
camping
salesperson.
END_STATUTE

Sec. 5. Section 32-2130, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-2130.

Renewal of licenses; education requirements; broker licensee
renewal as salesperson licensee

A. Except as provided in subsection K of this
section, a license may be renewed in a timely manner by filing an application
for renewal in the manner prescribed by the commissioner, by paying the renewal
fee specified in this chapter and by presenting evidence of attendance at a
school certified by the commissioner during the preceding license period of
twenty-four credit hours for salespersons and associate brokers and
thirty credit hours for designated brokers or for associate brokers employed by
a designated broker pursuant to section 32-2151.01, subsection G, or a
lesser number of credit hours prescribed by the commissioner, of real estate
oriented continuing education courses prescribed and approved by the
commissioner. The total number of credit hours shall be accrued at a
rate of twenty-four credit hours for salespersons and associate brokers
and thirty credit hours for designated brokers or for associate brokers
employed by a designated broker pursuant to section 32-2151.01,
subsection G during each twenty-four-month period of
licensure. The department shall maintain a current list of approved
courses. The commissioner may waive all or a portion of the
continuing education requirement for good cause shown.� The commissioner shall
determine by rule the content of the renewal credit hours. The
renewal credit hours may include the commissioner's current topics, including
short sales.� For the purposes of this subsection, "short sales"
means real estate transactions in which the sales price is insufficient to pay
the loan encumbering the property in addition to the costs of sale and the
seller is unable to pay the difference.

B. If an applicant is renewing a license within one
year after it expired, the applicant may apply continuing education hours
completed after the expiration toward the continuing education required for
renewal.

C. Each renewal application shall contain, as
applicable, the same information required in an original application pursuant
to section 32-2123.

D. Cemetery brokers and salespersons and membership
camping brokers and salespersons are exempt from the educational requirements
of this section.

E. This section does not require a licensee to
attend department produced or sponsored courses if approved courses are
otherwise available.

F. Between the expiration date of the license and
the date of renewal of the license, the rights of the licensee under the
license expire.� While the license is expired it is unlawful for a person to
act or attempt or offer to act in a manner included in the definition of a real
estate
broker or real estate salesperson, a timeshare
salesperson, a
cemetery
broker or cemetery salesperson

or
a
membership camping broker or

membership camping
salesperson. If the license of an
employing broker expires under this subsection, the licenses of persons who are
employed by the employing broker shall be severed from the employing broker on
the license expiration date of the employing broker. These persons
may be rehired on renewal of the employing broker's license. The
department shall terminate a license that has been expired for more than one
year.

G. Except as provided in section 32-4301, not
more than one year after the license expiration date, the department shall
renew a license without requiring the applicant to submit to an examination if
the applicant held a license that was not canceled or suspended at the time of
expiration.� Except as provided in section 32-4301, the license period
for a license renewed pursuant to this subsection commences the day after the
expiration date of the expired license. Except as provided in
section 32-2131, subsection A, paragraph 4 or 6, an applicant whose
license has been terminated or revoked does not qualify for license renewal.

H. Any employee or immediate family member of any
employee of this state who, pursuant to section 32-2110 or any other law,
rule or requirement, is prohibited from using a license issued under this
chapter shall have, on the request of the employee or family member, the
license placed on inactive status, shall have the right to renew the license
and shall not be required to pay further fees until the employee or family
member is again eligible to use the license. Renewal fees for the
license shall not be required for only as long as the employee or family member
is prohibited from using the license.

I. The department shall not renew the license of a
person who has been convicted of a felony offense and who is currently
incarcerated for the conviction, paroled or under community supervision and
under the supervision of a parole or community supervision officer or who is on
probation as a result of the conviction. This subsection does not
limit the commissioner's authority and discretion to deny the renewal for any
other reason pursuant to this chapter.

J. A real estate broker licensee may renew as a real
estate salesperson licensee without having to meet the requirements prescribed
by section 32-2124, subsection B. If a person renews as a real
estate salesperson pursuant to this subsection, the person shall pay the
salesperson's renewal fee as prescribed in section 32-2132.� If the
person subsequently wants to obtain a real estate broker license, the person
must meet the requirements of this chapter, including the requirements
prescribed by section 32-2124, subsection C.

K. A licensee with an inactive license does not need
to complete continuing education credit hours during the period that the
license is inactive. If the licensee applies with the department to
change the license status to active:

1. The commissioner may require the licensee to
complete continuing education credit hours before activating the license.

2. In addition to the continuing education
requirement described in paragraph 1 of this subsection, if the license has
been inactive for more than fifteen years, the commissioner shall require that
the applicant successfully pass an examination specific to the laws of this
state relating to this chapter before activating the license.

L. One year before the fifteen-year period
described in subsection K, paragraph 2 of this section expires, the department
shall send a notice to a licensee with an inactive license.� The notice shall
be sent to the licensee's last known address of record maintained by the
department and shall disclose the requirements of subsection K of this section.

END_STATUTE

Sec. 6. Title 32, chapter 20, article 2,
Arizona Revised Statutes, is amended by adding section 32-2134.02, to read:

START_STATUTE
32-2134.02.

Timeshare salesperson certificate of convenience

Notwithstanding any other licensing requirement
pursuant to this chapter, the commissioner may issue a onetime thirty-day
certificate of convenience without examination to any person who has applied
and otherwise qualifies for a timeshare salesperson's license.� An employing
timeshare plan developer's designated broker shall certify by affidavit to the
commissioner that the timeshare salesperson applicant will be trained in
applicable timeshare and contract laws before participating in any offer or
sale.
END_STATUTE

Sec. 7. Section 32-2153, Arizona Revised
Statutes, is amended to read:

START_STATUTE
32-2153.

Grounds for denial, suspension or revocation of licenses; letters
of concern; provisional license; retention of jurisdiction by commissioner;
definitions

A. The commissioner may suspend or revoke a license,
deny the issuance of a license, issue a letter of concern to a licensee, issue
a provisional license or deny the renewal or the right of renewal of a license
issued under this chapter if it appears that the holder or applicant, within
five years immediately preceding, in performing or attempting to perform any
acts authorized by the license or by this chapter, has:

1. Pursued a course of misrepresentation or made
false promises, either directly or through others, whether acting in the role
of a licensee or a principal in a transaction.

2. Acted for more than one party in a transaction
without the knowledge or written consent of all parties to the transaction.

3. Disregarded or violated any of the provisions of
this chapter or any rules adopted by the commissioner.

4. Knowingly authorized, directed, connived at or
aided in the publication, advertisement, distribution or circulation of any
material false or misleading statement or representation concerning the
licensee's business or any land, cemetery property, subdivision or membership
campground or camping contract offered for sale in this or any other state.

5. Knowingly used the term "real estate
broker", "cemetery broker" or "membership camping
broker" without the legal right to do so.

6. Employed any unlicensed salesperson or unlicensed
associate broker.

7. Accepted compensation as a licensee for
performing any of the acts specified in this chapter from any person who is not
authorized to provide compensation pursuant to section 32-2155.

8. Represented or attempted to represent a broker
other than the broker to whom the salesperson or associate broker is licensed.

9. Failed, within a reasonable time, to account for
or to remit any monies, to surrender to the rightful owner any documents or
other valuable property that comes into the licensee's possession and that
belongs to others, or to issue an appraisal report on real property or cemetery
property in which the licensee has an interest, unless the nature and extent of
the interest are fully disclosed in the report.

10. Paid or received any rebate, profit,
compensation or commission in violation of this chapter.

11. Induced any party to a contract to break the
contract for the purpose of substituting a new contract with the same or a
different principal, if the substitution is motivated by the personal gain of
the licensee.

12. Placed a sign on any property offering it for
sale or for rent without the written authority of the owner or the owner's
authorized agent.

13. Solicited, either directly or indirectly,
prospects for the sale, lease or use of real property, cemetery property or
membership camping contracts through a promotion of a speculative nature
involving a game of chance or risk or through conducting lotteries or contests
that are not specifically authorized under this chapter.

14. Failed to pay to the commissioner the renewal
fee as specified in this chapter promptly and before the time specified.

15. Failed to keep an escrow or trust account or
other record of monies deposited with the licensee relating to a real estate
transaction.

16. Commingled the monies or other property of the
licensee's principal or client with the licensee's own or converted these
monies or property to the licensee or another.

17. Failed or refused on demand to produce any
document, contract, book, record, information, compilation or report that is in
the licensee's possession or that the licensee is required by law to maintain
concerning any real estate, cemetery or membership camping business, services,
activities or transactions involving or conducted by the licensee for
inspection by the commissioner or the commissioner's representative.

18. Failed to maintain a complete record of each
transaction that comes within this chapter.

19. Violated the federal fair housing law, the
Arizona civil rights law or any local ordinance of a similar nature.

20. Tendered to a buyer a wood infestation report in
connection with the transfer of residential real property or an interest in
residential real property knowing that wood infestation exists or that the wood
infestation report was inaccurate or false as of the date of the tender or that
an inspection was not done in conjunction with the preparation of the wood
infestation report.

21. As a licensed broker, failed to exercise
reasonable supervision over the activities of salespersons, associate brokers
or others under the broker's employ or failed to exercise reasonable
supervision and control over the activities for which a license is required of
a corporation, limited liability company or partnership on behalf of which the
broker acts as designated broker under section 32-2125.

22. Demonstrated negligence in performing any act
for which a license is required.

23. Sold or leased a property to a buyer or lessee
that was not the property represented to the buyer or lessee.

24. Violated any condition or term of a
commissioner's order.

25. Signed the name of another person on any
document or form without the express written consent of the person.

26. As a licensed school, failed to exercise
reasonable supervision over the activities for which a license is required for
an owner, director, administrator or instructor in the school's employ.

B. The commissioner may suspend or revoke a license,
deny the issuance of a license, issue a letter of concern to a licensee, issue
a provisional license or deny the renewal or the right of renewal of a license
issued under this chapter if it appears that the holder or applicant has:

1. Procured or attempted to procure a license under
this chapter for the holder or applicant or another by fraud, misrepresentation
or deceit or by filing an original or renewal application that is false or
misleading.

2. Been convicted in a court of competent
jurisdiction in this or any other state of a felony or of any crime of forgery,
theft, extortion, conspiracy to defraud, a crime of moral turpitude or any
other like offense.

3. Made any substantial misrepresentation.

4. Made any false promises of a character likely to
influence, persuade or induce.

5. Been guilty of any conduct, whether of the same
or a different character than specified in this section, that constitutes fraud
or dishonest dealings.

6. Engaged in the business of a real estate broker,
cemetery broker or membership camping broker or real estate salesperson,
timeshare salesperson,
cemetery salesperson or membership
camping salesperson without holding a license as prescribed in this chapter.

7. Demonstrated incompetence to perform any duty or
requirement of a licensee under or arising from this chapter.� For the purposes
of this paragraph, "incompetence" means a lack of basic knowledge or
skill appropriate to the type of license the person holds or a failure to
appreciate the probable consequences of the licensee's action or inaction.

8. Violated the terms of any criminal or
administrative order, decree or sentence.

9. Violated any federal or state law, regulation or
rule that relates to real estate or securities or that involves forgery, theft,
extortion, fraud, substantial misrepresentation, dishonest dealings or violence
against another person or failure to deal fairly with any party to a
transaction that materially and adversely affected the transaction.� This
paragraph applies equally to violations of which the licensee was convicted in
any lawful federal or state tribunal and to any admissions made in any settlement
agreement by the licensee to violations.

10. Failed to respond in the course of an
investigation or audit by providing documents or written statements.

C. A judgment based on a court's finding or
stipulation of fraud by a licensee following a trial on the merits or a
criminal conviction of a licensee that results in a payment from the real
estate recovery fund is prima facie evidence of a violation and grounds for
discipline under this section.

D. The commissioner may deny, suspend or revoke the
issuance of a license on application by a corporation, a limited liability
company or a partnership if it appears that an owner, officer, director,
member, manager, partner, stockholder owning ten percent or more of the stock
in the corporation or limited liability company or person exercising control of
the entity is a current or former licensee whose license as a broker or a
salesperson has been denied, suspended or revoked.

E. The lapsing or suspension of a license by
operation of law or by order or decision of the commissioner or a court of law
or the voluntary surrender of a license by a licensee does not deprive the
commissioner of jurisdiction to do any of the following:

1. Proceed with any investigation of or action or
disciplinary proceeding against the licensee.

2. Render a decision suspending or revoking the
license or denying the renewal or right of renewal of the license.

3. Assess a civil penalty pursuant to section 32-2160.01.

F. For the purposes of this section:

1. "Letter of concern" means an advisory
letter to notify a licensee that, while the conduct or evidence does not
warrant disciplinary action, the commissioner believes that the licensee should
modify or eliminate certain practices and that continuation of the activities
may result in disciplinary action against the licensee.

2. "Provisional license" means a license
that the department issues and that allows a licensee to practice subject to
either a consent order as prescribed in section 32-2153.01 or the
commissioner's terms, conditions and restrictions.
END_STATUTE

Sec. 8.
Legislative intent

The legislature intends to:

1. Establish a separate
type of real estate license under the state real estate department for
individuals who are retained exclusively to assist others in purchasing,
selling and exchanging timeshare interests.

2. Narrow the scope of the
training and the examination requirements for applicants for timeshare
salesperson licenses and thereby reduce the barriers for employment while protecting
the public by requiring that all purchases, sales and exchanges of timeshare
interests be performed under the purview of a licensed real estate broker and
in full compliance with the specified statutory and regulatory requirements
applicable to timeshare sales.

Sec. 9.
Effective date

This act is effective from and after
June 30, 2027.