2025 Legislative Focus: Tackling Arizona’s Housing Challenges

A Look Ahead: AMA Priorities for the 2025 Arizona Legislative Session

The 57th Arizona Legislature will begin its 2025 session on January 13th, with Republicans entering the new term strengthened by increased majorities in both chambers. These election results will surely influence legislative priorities and shape how lawmakers work with Democratic Governor Katie Hobbs.

Read 2025 Public Policy Agenda

Partisan Makeup of the Legislature 

Arizona State Senate:
Republicans gained one seat, bringing their total to 17, while Democrats hold 13 seats, down from 14 last session.

Arizona House of Representatives:
Republicans expanded their control by adding two seats, increasing their total to 33, while Democrats dropped from 29 to 27 seats.

Addressing Arizona’s Housing Crisis

The AMA team has already begun tracking bills and meeting with new and returning legislators to ensure that the right reforms move forward, including being signed into law by Gov. Hobbs. 

We’ve outlined a focused legislative agenda for this session, emphasizing housing affordability, further streamlining development policies and procedures, and protecting balanced property owner/resident rental housing policies. The AMA’s priorities reflect the urgent need to address Arizona’s growing housing crisis while ensuring fairness and efficiency in housing policy.

Extension and Expansion of the State LIHTC Program

The Low-Income Housing Tax Credit (LIHTC) program has been a cornerstone of affordable housing development both nationally and in Arizona. Since its creation, Arizona’s version of LIHTC has resulted in more than 1,200 affordable housing units, providing much-needed options for families and individuals struggling to find housing.

Developers agree: Arizona needs more tax credit programs like LIHTC to encourage the construction of affordable housing. The program has proven to be an effective incentive for developers, benefiting workforce housing, seniors, and veterans.

The current state LIHTC program is set to expire at the end of FY2025, creating urgency for legislative action. AMA will advocate for an extension of the program and explore opportunities for its expansion to ensure that this successful tool continues to drive new affordable housing projects. Renewing LIHTC may be one of the best strategies to address Arizona’s housing crisis and accommodate our rapidly growing population.

Speeding Up Municipal Review for Development Approvals

One of the most significant challenges facing AMA members is the extended timeline for new developments. What used to take a few months now often stretches into years, with municipal regulations causing unnecessary delays and offering little benefit to consumers. From application submission to the start of construction, developers are stuck in limbo, unable to address the state’s housing shortage in a timely manner.

Under current law, municipalities may authorize planning staff to approve site plans, development plans, and other actions without public hearings. However, this authorization is optional, and many cities choose not to implement these streamlined processes.

AMA proposes a legislative amendment to change “may” to “shall” in the statute, requiring all cities and towns to adopt administrative review procedures. This change would create consistency across municipalities, reduce bureaucratic hurdles, and accelerate the timeline for housing developments. By cutting unnecessary delays, Arizona can better meet the demand for new housing.

Assistance Animals: Enhancing Transparency and Accountability

The AMA is also prioritizing an amendment to the Landlord-Tenant Act to address the growing concerns surrounding assistance animals. This proposal includes two key components:

1. Verification of Need: Property owners and managers would be allowed to request reliable documentation verifying a tenant’s disability and the disability-related need for a assistance animal.
2. Liability Protections: The legislation would shield property owners from liability for injuries caused by assistance animals on their properties.

This type of reform has already been enacted in states such as Pennsylvania, Montana, Illinois, and California. Implementing similar measures in Arizona would balance resident accommodations with protections for property owners and managers, ensuring a fair and transparent process for all parties involved.

Ensuring Renewal for the Arizona Department of Housing

The AMA strongly endorses the reauthorization of the Arizona Department of Housing beyond its scheduled sunset date in FY2025.

As the state’s primary agency for housing policy and program administration, ADOH distributed nearly $1.3 billion last year in financing, grants, and support to nonprofits, housing developers, and municipal programs. The department’s expertise in distributing federal and state resources, coordinating with local governments, and implementing statewide housing initiatives makes it an essential component of Arizona’s housing ecosystem.

The department’s continuation is vital for the state and our industry to address the housing supply crisis. ADOH provides critical coordination that helps prevent fragmentation of housing policy across multiple agencies. Without ADOH running point, Arizona would face significant challenges in addressing its growing housing needs and maintaining consistent standards across jurisdictions.

The AMA believes that preserving ADOH’s authority and capabilities is fundamental to advancing sound housing policy in Arizona. We are committed to supporting the department’s reauthorization to ensure continued effective management of housing programs and resources throughout the state.

The Task Ahead

Arizona remains as much as 270,000 homes short of satisfying demand, and voters continue to call for action to address the housing supply crisis. Recent years have seen progress, such as allowing accessory dwelling units in larger cities and reducing municipal regulations. 

With pro-housing leaders playing a prominent role in the upcoming legislative session, the AMA will push forward our efforts to bring more housing options to accommodate Arizona’s growing population. We will also be vigilant to protect against industry-killing legislation like rent control – which looks not to be an issue given the GOP control of both houses this session.

The stakes for Arizona’s housing future remain high, and the AMA is committed to achieving more meaningful victories during this critical legislative session.