Arizona Legislature Adjourns

The following bills have been signed by the Governor:

Senate Bill 1185, Withholding Tax Rates
SB 1185 aligns Arizona’s income tax statutes to federal laws passed in 2008. With an emergency clause included, the new law is effective January 1, 2010. State withholding rates have increased by approximately 15 percent. For the first six months of 2010, the state withholding rate will be lowered by approximately 7 percent to 7.5 percent of the new 2009 rate. By July 1, 2010, the Arizona Department of Revenue is instructed to implement state withholding rates that are independent of the federal rate.

Senate Bill 1322, Unemployment Insurance
SB 1322 temporarily provides 13 to 20 weeks of additional unemployment benefits to workers who exhaust their regular benefits. The temporary measure is funded by the federal stimulus money signed into law by President Obama in February 2009.

The following bills are awaiting the Gov. Brewer’s action:

House Bill 2306, Authorized Presence; Licensees
In 2007, The Legal Arizona Workers Act (LAWA) passed into law. The Act made several changes to statutes related to unauthorized workers, including a provision suspending business licenses for the first violation of LAWA and requiring license revocation upon a second violation during a probationary period.  After December 31, 2007, LAWA also required all employers with operations in the state of Arizona to use the Basic Pilot Program to verify employment eligibility. In 2008, some changes were made to LAWA, including the prohibition of issuing a license to an individual who does not present documents indicating authorized presence in the United States. 

This year, the Legislature passed further changes to LAWA. The provisions include: exempting an individual who has affirmatively established citizenship or non-expiring work authorization from providing subsequent documentation of that status upon renewal or reinstatement of a license; and requiring an individual who has a limited form of authorization that has expired to provide documentation of citizenship or alien status upon seeking license renewal or reinstatement.

HB 2323, Small business Health Coverage
In 2006, the legislature passed and the Governor signed into law a bill allowing health insurance carriers to offer policies that included a basic level of care to small businesses with 2 to 50 employees. The intent of the law was to get another health insurance option - that was affordable - on the table for small businesses. But this scaled-back plan was only available to small businesses that were without health insurance for at least six months, a so-called “go bare” time period.

HB 2323 seeks to reduce the “go bare” period for small businesses to 90 days. Further, the measure includes provisions that would allow health insurance carriers to offer mandate-lite insurance policies to individuals and sole proprietors.

House Bill 2324, Individual Health Coverage
HB 2324 would provide individuals access to another, mandate-lite health insurance option similar to what can already be offered to small businesses with two to 50 employees.

It would provide options to individuals who have lost their health insurance in the following ways:

• Terminated from a job that provided health insurance coverage.
• Left at own volition to open a small business.
• Employer discontinued offering health insurance coverage.
• Exhausted COBRA coverage or found that COBRA coverage was unaffordable.
• Health insurance coverage was discontinued due to death of a spouse or divorce.
• Participation in public health care programs was discontinued.

Senate Bill 1018, Medical Malpractice
SB 1018 would raise the burden of proof in medical malpractice civil actions against healthcare providers and hospitals to clear-and-convincing evidence in connection with certain emergency medical services.

Senate Bill 1113, Guns in Restaurants
SB 1113 would allow an individual that holds a concealed carry weapons (CCW) permit to carry a concealed handgun into a restaurant licensed as an on-sale retailer (an establishment that sells alcohol for consumption on or off the premises).  To protect property rights, SB 1113 would allow restaurants to prohibit guns on the premises if a sign is posted in a location accessible to the general public and immediately adjacent to a licensee’s posted liquor license.

Senate Bill 1168, Guns in Motor Vehicles/Parking Lots
SB 1168 would prevent private property owners (tenants, employers and businesses) from prohibiting the storage or transport of lawfully possessed firearms in locked and privately-owned vehicles parked in a privately owned parking lot, parking garage, or other designated parking area. More specifically, an owner of a parking lot, parking garage, or other designated parking area would not be allowed to have a policy that prohibits an individual from lawfully storing a firearm in an individual’s locked and privately owned motor vehicle or in a locked compartment on the person’s privately owned motorcycle. (NOTE: the firearm is not permitted to be visible from the outside of the motor vehicle or motorcycle.)

Properties with all of the following attributes would be permitted to ban storage of firearms in an individual’s motorize vehicle:

• Are secured by a fence or other physical barrier.
• Limit access by a guard or other security measure.
• Provide temporary and secure firearm storage.
• Allow for the immediate retrieval of the firearm on exit from the premises.

The measure would allow property owners who provide alternative parking in a location reasonably proximate to the primary parking area and do not charge a fee for such parking to maintain a policy of restricting gun storage in a vehicle on their immediate property (outside of the building).

Also exempted from SB 1168 are:

• Nuclear generating stations that have a secured and gated or fenced parking lot, parking garage or other area designated for parking motor vehicles; and provide temporary and secure firearm storage for employees/visitors to their facilities.
• Owner or tenant occupied single family detached residences.
• Department of Defense contractors located in whole or in part on a U.S. military installation.

(NOTE: Due to the language in the Arizona Constitution, immunity from liability cannot be granted to property owners for incidents involving a firearm on their parking garage, parking lot, or other designated parking.)

Senate Bill 1262, Workers’ Compensation Omnibus Bill
If signed into law, SB 1262 would enact the following workers compensation reforms:

• If an employer knowingly misrepresents employee and payroll information for workers’ compensation insurance, a penalty of up to three times (decreased from the current ten times) the amount of difference in the premium paid versus the amount the employer should have paid would be assessed on that employer. The penalty would be collected in a civil action by the insurance carrier, in addition to any other damages incurred by the carrier as a result of the misrepresentation, including costs and attorney fees. A carrier would be required to act within four years after the date the carrier knew or should have known of the employer’s misrepresentation.
• In cases of an injury that causes temporary or permanent partial disability for work, the Industrial Commission of Arizona (ICA) would be required to consider an employee’s earning capacity based on wages from previously terminated employment. Examples of situations where this measure would apply include cases where the employee would have abandoned his or her job and termination for misconduct.
• The measure changes the effective date for workers’ compensation rates from October 1 to January 1.
• Regarding drug usage in workers’ compensation claims, this measure would require physicians, upon the request of an interested party, to include information about the off-label use of a narcotic, opium-based controlled substance, or controlled substance II by a claimant in their report to the ICA, including the justification for its use. Physicians would be required to specify a treatment plan including subsequent follow-up visits, drug testing, and documentation that the medication regime is providing demonstrable relief for the injured worker.

Senate Bill 1266, Workers Compensation Benefits; Drugs and Alcohol
In 2007, a law was passed that allowed workers’ compensation carriers to offer up to a 5 percent premium discount to businesses that implemented a qualified drug and alcohol testing policy in their workplace.

SB 1266 would eliminate the requirement that businesses file their qualified drug and alcohol testing policy with the Industrial Commission of Arizona in order to receive a 5 percent premium discount. If signed into law, businesses would only need to make their qualified drug and alcohol policy available to their insurance carrier for audit to ensure a 5 percent premium discount.