PUBLIC POLICY GUIDE

ADVOCACYPhoenix REALTORS® works on behalf of our membership to ensure an environment exists in local government that promotes home ownership and allows real estate professionals to conduct business free from onerous rules, regulations and ordinances. We work in three arenas: Policy, Politics and Public Affairs.

POLICYWe work with local elected officials and their staffs to promote good public policy protecting the way our members do business. Our role with local government also provides the first line of defense from potentially harmful legislation.

We work to identify and support political candidates who understand and support REALTOR® priorities. POLITICS

We work to heighten the presence of REALTORS®, and our priorities, by designing and implementing effective grassroots campaigns throughout our community.

PUBLIC AFFAIRS

Phoenix REALTORS® has adopted the following GUIDING PRINCIPLES and POLICY STATEMENTS for the purpose of safeguarding our community, our business and our quality of life.

Adopted by the Board of Directors on March 12, 2019

PREAMBLE TO THE REALTOR® CODE OF ETHICS

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Under all is the land. Upon its wise utilization and widely allocated ownership depend the survival and growth of free institutions and of our civilization. REALTORS® should recognize that the interests of the nation and its citizens require the highest and best use of the land and the widest distribution of land ownership. They require the creation of adequate housing, the building of functioning cities, the development of productive industries and farms, and the preservation of a healthful environment.

THE GUIDING PRINCIPLES & POLICIES

Protecting homeownership and the innate rights that come with this achievement are basic tenets of our commitment to our REALTOR® members and all Arizona homeowners.

PRIVATE PROPERTY RIGHTS

In general, Phoenix REALTORS® supports the creation of incentive-based programs designed to achieve desired public outcomes in lieu of mandates, whenever possible. Mandate-based programs often have unintended consequences, including negative impacts on affordability and other undesirable outcomes.

Phoenix REALTORS® supports the preservation and enhancement of private property rights.

The freedom to buy, sell, and utilize property, as protected in the 5th amendment, underlies all real estate transactions and markets. Any restrictions placed on a property owner from realizing the highest and best use of that property hinders economic growth and development and reduces freedoms inherent in our society.

Governments shall not arbitrarily infringe on the basic right of the individual to acquire, possess and freely transfer real property, and shall protect private property rights as referred to in the 5th and 14th Amendments of the United States Constitution.

Phoenix REALTORS® supports legislative implementation of the 5th Amendment’s guarantee of compensation when property rights are taken. Every person should have the right to acquire real property with confidence and certainty that the use or value of such property will not be wholly or substantially eliminated by governmental action at any level without just compensation or the owner’s express consent.

In addition, Phoenix REALTORS® supports legislation which will provide property owners expeditious access to administrative and judicial systems at all levels - local, state and federal - to pursue 5th Amendment takings

claims or relief from other property rights violations.

Private Property Rights Abuse: Phoenix REALTORS® supports efforts to prohibit individual abuses of private property rights through zoning, the permitting process, and other actions which do not restrict property owners across a political jurisdiction of their private property rights.

Code Enforcement: Phoenix REALTORS® supports effective code enforcement strategies that are informed by data and a thorough review of best practices in comparable municipalities. Code enforcement practices should properly target repeat offenders without affecting property owners who are in compliance.

Protecting homeownership and the innate rights that come with it are basic tenets of our commitment to our REALTOR® members and all Arizona homeowners.

LAND USE / DEVELOPMENT / ZONING

The Phoenix Association of REALTORS® embraces Land Use, Development and Zoning principles that provides and encourages a compatible mix of housing types that meets the needs of consumers. Development should account for a range of accessible transportation choices, take advantage of compact building designs, leverages mixed-use opportunities, and offers a wide variety of housing opportunities. We support strategic development as it relates to housing options and affordability throughout our city by supporting a connected city for all its residents including our workforce. Pursuing development that promotes economic growth, healthy natural environments, and a high quality of life for residents, employees, and visitors also requires community and stakeholder collaboration in planning decisions and ensuring that development decisions are fair, predictable, and cost effective.

Eminent Domain: Phoenix REALTORS® supports legislative or administrative actions that would effectively keep compensation to owners of condemned property to an amount which is equal to or greater than the full present market value of the full interest in the property being taken and the costs to cure if applicable.

Development Costs: Phoenix REALTORS® supports reasonable development which would contribute a portion of the cost of providing public services and infrastructure.

Commercial Zoning: Phoenix REALTORS® supports a Commercial Zoning Ordinance that protects the rights of property owners and neighborhoods.

Downzoning: Phoenix REALTORS® opposes any “downzoning” or a reduction of economic value without compensation to property owners.

Notification: Phoenix REALTORS® advocates adequate notifications of any property owner whose property may be affected by changes proposed by government regulations.

LAND USE / DEVELOPMENT / ZONING continued

Annexation: Phoenix REALTORS® supports annexation that does not dilute the level of services currently being delivered to the public.

General Plan Amendments: Phoenix REALTORS® supports legislation and actions intended to preserve and protect stable, viable and integral neighborhoods.

Planning Efforts: a. Phoenix REALTORS® supports the involvement of its members with the planning committees for all city and county planning areas and shall strive to have members appointed to each committee.

b. Phoenix REALTORS® supports infill which is the process of developing vacant or extensively under-utilized land parcels which have been bypassed during the course of urbanization so long as it conforms with the Phoenix General Plan (zoning), Phoenix REALTORS® shall examine the effects of any potential zoning changes that change density

within the infill neighborhood as it relates to property values and property rights.

c. Phoenix REALTORS® encourages the revitalization and success of existing neighborhoods.

d. Phoenix REALTORS® supports legislation, actions and education by the Arizona Association of REALTORS® intended to manage growth while protecting private property rights.

Moratorium: Phoenix REALTORS® opposes moratoriums which affect real property except those cases where further study is justified and a specific time period has been established for the study.

Design Review: Phoenix REALTORS® supports single family residential design review guidelines that enhance neighborhood aesthetics but maintain affordability for the consumer.

Zoning and Land Use: Phoenix REALTORS® supports efforts to prohibit abuses of private property rights through zoning, the permitting process, and other actions.

Phoenix REALTORS® opposes any proposed takings of private property rights by a body of government, unless through formal condemnation proceedings and/or if just compensation is paid to the property owner.

Phoenix REALTORS® supports the requirement of due process to enact any zoning, floodplain, or similar, not merely to implement social goals.

Phoenix REALTORS® supports the basic principle of private property ownership of riverbeds not determined to be navigable.

Phoenix REALTORS® supports legal non-conforming uses and acknowledge that they are an integral portion of a property’s value, usability and uniqueness in the marketplace.

HOUSING AFFORDABILITY

Housing supply has a direct bearing on the cost of housing. A significant imbalance between supply and demand generally leads to higher prices for homes that spend less time on the market and may have a direct impact on affordability. Increasing the supply and variety of housing is the only way to ensure a well-balanced market that fits the diverse needs of our communities.

HOUSING SUPPLY AND WORKFORCE HOUSING As a community, we need to ensure that the homes we create for the people who work, live, and play in our region are both affordable and accessible to essential services. Phoenix REALTORS® supports solutions that allow for homes that serve all members of the community, accommodate new populations, and help current residents find what they want. This includes policies that increase geographically distributed workforce housing options for all residents, through structured programs that incentivize quality affordable housing, and through removing regulatory obstacles to affordability.

DIVERSE MIX OF HOUSING TYPES The path to more inclusive communities with a healthy range of people at different income levels is to create conditions that allow for abundant housing options for all residents, both those living here today and those who strive to make the Phoenix & Maricopa County area their home tomorrow. A broader variety of housing options, ranging from accessory dwelling units to duplexes and multiplexes to townhouses, would provide a healthy menu of housing choices that are compatible with nearby single-family dwellings and support vibrant corridors and activity centers.

These medium-scale housing options are not only affordable to more residents, they allow for greater density and infill throughout the area without disrupting neighborhood character. Phoenix REALTORS® supports measures that ensure a balance of housing types available throughout the valley.

EASING REGULATORY OBSTACLES TO AFFORDABILITY Phoenix REALTORS® recognizes that while many dimensions of housing affordability are beyond the direct influence of local governments, there are quantifiable direct and indirect costs associated with certain regulations. Some examples include permitting and development review fees. These costs have a bearing on affordability and must be carefully weighed in observance of their cumulative impact on the cost of housing. As such, regulations with such an impact should be streamlined and closely tied to a clear public purpose.

PURSUING CREATIVE FINANCING OPTIONS Mounting pressures on affordability are resulting in fewer choices on potential homeowners, and property taxes are a significant driver of these pressures. On account of this, it is necessary for decision makers to consider alternative financing options for public priorities, such as sales taxes shared by all, partnerships with private and non-profit groups, and fully leveraging outside funds.

Housing Needs: Phoenix REALTORS® supports educating and creating awareness with REALTORS® and the public in regard to housing needs, programs and opportunities.

Phoenix REALTORS® supports legislation that would both proactively and reactively:

• Educate the public to housing opportunity programs

• Create sensible funding/opportunity for housing assistance except when in conflict with Phoenix REALTORS® positions covered in Policies on Private Property Rights Abuse or other supporting policies in this section.

• Stimulate infill incentives

• Assist in expanding housing opportunities for service workforce, minorities, and first-time homebuyers.

HOUSING AFFORDABILITY continued

Phoenix REALTORS® supports exemptions to impact fees for housing marketed to low and moderate-income households.

Phoenix REALTORS® supports encouraging planning activities that promote affordable housing through higher density and mixed-use development.

Affordable Housing Education: Phoenix REALTORS® supports working with the Arizona Association of REALTORS® in providing education and information on affordable housing.

Accessible Housing Standards: Phoenix REALTORS® supports accessible housing building standards provided that it has a minimal affect on housing affordability.

Dedicated Funding: Phoenix REALTORS® opposes the creation of programs, trusts, or funds by a City or County that use or seek to use taxes or fees as a dedicated source of revenue for funding affordable housing.

Phoenix REALTORS® supports a regional approach to improving, sustaining, and expanding mobility in the Phoenix Metro area to relieve traffic congestion and meet future needs of a rapidly growing population.

TRANSPORTATION

As the population in the Phoenix Metro area soars, it faces serious mobility challenges. Providing adequate mobility is critical for maintaining a healthy real estate market and is necessary in order to help sustain our city’s growth and prepare for the forecasted increases in population and automobiles using our roadways.

General Transportation Policy: a. Phoenix REALTORS® supports the orderly development and maintenance of transportation systems in an economically responsible manner.

b. Phoenix REALTORS® supports transportation locations and design alternatives that protect or minimize the negative effects on neighborhoods.

c. Phoenix REALTORS® supports land use plans that reduces vehicular trip generation.

d. Phoenix REALTORS® opposes the use of reverse lanes in the City of Phoenix where property values are harmed.

Freeways: Phoenix REALTORS® supports a policy of building first those freeways which will provide the greatest immediate relief from traffic congestion in an economically sound manner.

Transportation Financing: a. Phoenix REALTORS® will consider supporting financing, consistent with our policies on taxation to fund transportation systems in Maricopa County.

b. Phoenix REALTORS® supports the efforts to bring a comprehensive transit system to the City of Phoenix. Phoenix REALTORS® encourages alternative funding measures and supports referring potential taxes to the ballot for a public vote. Phoenix REALTORS® also encourages implementation of other non-vehicular transportation options to reduce congestion and improve air quality.

Phoenix REALTORS® recognizes that our environment and natural resources are worth protecting. REALTORS® support policies and programs that encourage conservation and wise use of natural resources.

ENVIRONMENT

Environmental policies require community and stakeholder collaboration in decisions to insure they are fair, predictable, and cost effective. Policies should emphasize education over mandates.

Environmental Issues: The Association will provide information and education to its members regarding environmental issues including proper disclosure.

Hazardous/Toxic Waste: Phoenix REALTORS® supports the education of its members and of the citizenry as to the liability and danger of hazardous and toxic waste.

Water Conservation: Phoenix REALTORS® encourages and supports the water conservation efforts of public agencies and governmental entities, concentrating on voluntary compliance and incentive programs.

Wood Burning: Phoenix REALTORS® supports voluntary no-burn days. Any new governmental regulation of wood burning shall grandfather existing structures.

Green Policy: Phoenix REALTORS® supports commercially reasonable and incentive-based approaches to reduce energy use and greenhouse gases; solutions that are guided by market and smart growth principles protecting private property rights and maintaining real estate affordability and availability; and educating property owners and consumers about the benefits and importance of energy efficiency.

Phoenix REALTORS® opposes requirements which impose undue economic burdens on property owners or managers; triggering such requirements especially at the time when residences or buildings are sold; and expanded application of existing laws or regulations that are not suited to address climate change.

Phoenix REALTORS® urges Cities and the County to adopt and follow a fiscal model that is fair, sound, balanced, and promotes job creation and economic vitality.

GOVERNMENT BUDGETS & TAXATION

A managed and sustainable tax base is essential to local government’s ability to deliver necessary services, new amenities for neighborhoods, and maintain infrastructure that serves the needs of the community. All decisions to increase or decrease taxes and/or fees, borrow or shift costs should be done through a public process that conveys the consequences to taxpayers and other stakeholders. Recognizing there is a need to strike a balance between taxes and revenues, before considering a tax or fee increase, every effort should be made to first identify and implement thoughtful, permanent reductions in City and County spending.

Zero Based Budgeting: Phoenix REALTORS® supports Phoenix’s zero-based budgeting and comprehensive budget review programs. Surpluses should not be expended in order to protect or penalize the budgets of subsequent years.

Financing: Where practically applicable, City services should be financed through 100% cost recovery user fees to fairly distribute the cost to the beneficiaries of the services.

Transfer Taxes: Phoenix REALTORS® supports the citizen approved 2008 constitutional amendment to ban real estate transfer taxes in the state of Arizona. Phoenix REALTORS® stands ready to work with other associations and industries to oppose any measure that would implement such taxes.

Personal Income Taxes & Interest Deductibility: Mortgage Interest Deduction allows homeowners to reduce their taxable income by deducting the amount paid in mortgage interest. This is an effective tool to facilitate homeownership.

Phoenix REALTORS® supports the National Association of REALTORS® position on Federal Tax Deductibility.

Phoenix REALTORS® supports the preservation of state deductibility of personal income taxes of interest and property taxes

on primary and secondary homes.

Services Taxes: Phoenix REALTORS® supports the citizen approved 2018 constitutional amendment to ban service taxes in the state of Arizona. Phoenix REALTORS® stands ready to work with other associations and industries to oppose any measure that would implement such taxes.

New Taxes & Fees: Phoenix REALTORS® is opposed to any tax or fee on any type of property transaction or any type of service not currently committed to a tax or fee. Examples may include but are not limited to recording fees, deed taxes, deed stamps, documentary stamp taxes, intangible taxes or mortgage taxes or fees.

Phoenix REALTORS® supports a state constitutional amendment prohibiting such taxes. Phoenix REALTORS® opposes levying new taxes without public referendum (i.e. a food tax).

Commercial Lease Tax: Phoenix REALTORS® supports the 2013 repeal of the rental lease tax on commercial property related to business entities that may be exempt of the City commercial lease tax.

Rental Lease Tax: Phoenix REALTORS® supports the repeal of the City transaction privilege (sales) and use tax or rental lease tax.

Industrial Development Authority Bonds (IDAs): Phoenix REALTORS® supports IDAs to issue taxable bonds for neighborhood improvements.

Property Taxes a. Phoenix REALTORS® favors alternatives revenue sources for local government other than property taxes as a tax on owner-occupied housing. The property tax affects the cost of residential investment, the housing sector, and the personal finances of homeowners.

b. Phoenix REALTORS® favors efforts to preserve the City of Phoenix’s Bond rating.

c. Phoenix REALTORS® favors continued state deductibility on personal income taxes of interest and property taxes on primary and secondary homes.

d. Phoenix REALTORS® opposes any effort to raise property taxes to purchase open space without the vote of the people.

e. Phoenix REALTORS® supports efforts to reduce reliance on real property taxes for capital finance of school construction, operation and maintenance.

GOVERNMENT BUDGETS & TAXATION continued

Tort Liability Being Added to Primary Property Tax: a. Phoenix REALTORS® supports the repeal of Arizona Administrative Code Regulation 15-12-202 which allows a city or town to set the primary property tax levy in excess of the maximum limit for an amount up to involuntary tort judgments paid and approved by the Property Tax Oversight Commission (PTOC).

b. Phoenix REALTORS® opposes the use of torts to increase the primary levy.

c. Phoenix REALTORS® supports tort liabilities being paid from the General Fund.

Privilege License (Sales) Tax Renewal Fees: a. Phoenix REALTORS® opposes Privilege License (Sales) Tax Renewal Fees for any property owner(s) who have less than three (3) residential units rented or available for rent in the State of Arizona.

b. Phoenix REALTORS® opposes any ordinance that mandates a property manager or broker who manages residential rental units be responsible for any tax or fee liability of the individual owner.

c. Phoenix REALTORS® supports efforts to repeal rental or lease taxes on real property at any level of government

No fee can be used for any purpose other than to offset the cost it was intended to cover.

Phoenix REALTORS® urges Cities and the County to adopt and follow a fiscal model that is fair, sound, balanced, and promotes job creation and economic vitality.

GENERAL

General: Phoenix REALTORS® encourages the fostering and continued success of existing businesses and recruitment of new businesses to the Valley, which may include the elimination of undue government restrictions and excessive regulatory costs.

Mandatory Inspection: Phoenix REALTORS® opposes any ordinance that would mandate any form of home inspection/code compliance ordinance as a prerequisite to the sale, transfer or exchange of real estate.

a. Phoenix REALTORS® supports the requirement of due process notification of all complaints or inspections of real property by government bodies prior to an inspection.

Signs: a. Phoenix REALTORS® supports a sign ordinance that allows REALTORS® to effectively market property.

b. Phoenix REALTORS® supports the continued right for real estate associated signage to be placed on public or private property with permission of the property owner or appropriate party.

Ordinances - Legal Liability Phoenix REALTORS® opposes city/county ordinances which mandate “due on sale” disclosure requirements that may cause legal liability for REALTORS®.

Citizens Committees: Phoenix REALTORS® encourages the City of Phoenix to adopt standards that require City of Phoenix citizen committees to be

comprised of a minimum of 80% of its members who live in the City of Phoenix and/or work in Phoenix.

American’s with Disabilities Act: Phoenix REALTORS® supports the American’s with Disabilities Act and further supports City standards requiring optional handicapped accessible features in new homes.

Predatory Lending: Phoenix REALTORS® opposes abusive or predatory lending practices and supports increasing the availability of mortgage credit to potentially credit-worthy borrowers whether in the “prime” or in the “subprime” credit markets.

Phoenix REALTORS® supports lobbying for statewide legislation opposing abusive or predatory lending practices and supports increasing the availability of mortgage credit to potentially credit-worthy borrowers whether in the “prime” or in the “subprime” credit markets.

Door to Door Solicitation: Phoenix REALTORS® supports Anti-Solicitation Ordinances on door to door solicitations so long as their intended use is a “crime prevention” tool used to protect the community and those soliciting and does not infringe on first amendment rights to free speech.

Where civil responsibilities and criminal liabilities are placed on the property owner, Phoenix REALTORS® supports making certain that they:

GENERAL continued

a. Are equally applied to all classes of property;

b. Are accompanied by clearly defined and achievable results;

c. Do not abridge constitutionally guaranteed rights;

d. Do not result in financial burdens to the property owner that results in the taking of this property without reasonable compensation.

Phoenix REALTORS® opposes any efforts to curtail member’s rights to make solicitations.

Phoenix REALTORS® opposes any legislation or ordinance that would make fire suppression mandatory in new or existing homes.

Light Detection and Ranging (LiDAR) a. Phoenix REALTORS® opposes the use of mobile Light Detection and Ranging (LiDAR) technology or other similar technologies for the purpose of conducting sign, billboard or other types of virtual inspections to identify code violations and personally identifiable information (any information relating to an identified or identifiable individual who is the subject of the information.)

b. Phoenix REALTORS® supports the use of mobile Light Detection and Ranging (LiDAR) technology or other similar technologies to observe and predict street-level activities that are public and may be safety issues (i.e. crosswalks, utility poles, traffic lights, lane markings, sign reflectivity, sidewalk cracking and other others) so they can proactively respond to changes that impact their

community.

Drones: a. Phoenix REALTORS® supports federal regulations that allow for the commercial use of unmanned aerial vehicle technology by the real estate industry.

b. Phoenix REALTORS® opposes Cities and Towns from adopting regulations on Unmanned Aerial Systems (UAS), Unmanned Aerial Vehicles (UAV) or Drone emergent technology while the Federal Aviation Administration, the National Telecommunications and Information Administration and any other relevant federal agencies and lawmakers are working to adopt rules and regulations governing this technology.

c. Phoenix REALTORS® supports the responsible use of Unmanned Aerial Systems (UAS), Unmanned Aerial Vehicles (UAV) or Drone emergent technology.

e. Phoenix REALTORS® encourages its members to be partners in the community as we work together in responding to the new challenges of privacy and public safety concerns of the communities in which they operate.

Group Homes Phoenix REALTORS® supports the licensing and regulation of group homes and sober living homes as long as it does not conflict with the Americans with Disabilities Act.

Arizona Landlord Tenant Act Rent Control: Phoenix REALTORS® opposes rent control of any kind.

Rental Housing Code: Phoenix REALTORS® opposes a separate rental housing code.

Phoenix REALTORS® opposes any legislation or ordinances related to blighted properties that would be inconsistent with the Arizona Landlord/Tenant Act.

Well-supported neighborhood schools greatly enhance neighborhood desirability and build community, whereas struggling schools present difficult choices to families with school-age children.

EDUCATION

Housing Options Phoenix REALTORS® recognizes that housing choices heavily influence school choices. Phoenix REALTORS® supports policies that enhance housing options for families with school-age children. Phoenix REALTORS® supports provide a range of housing choices attractive to families and individuals at all income levels.

Quality Education Phoenix REALTORS® recognizes that quality education is a foundation for growth and prosperity. Our public and private university system, robust community college system and ever-growing K-12 systems across the valley are a priority because of the value they play in decisions by buyers to locate into a specific area as well as the long-term health and sustainability of communities.