The Arizona Legislature is considering several bills that will directly affect our local economy, housing market, and tourism industry. Some of these bills present opportunities we need to seize. One poses a threat we need to stop. As your chamber, we are asking you to stand with us.
❌ OPPOSE: HB 2290 - TPT Sourcing; Business Location; Receipt
Arizona's Transaction Privilege Tax, or TPT, is the gross receipts tax that businesses collect and remit to the state. Those dollars are then distributed back to the state, county, and municipality where the sale was "sourced." In plain terms, sourcing determines which community gets credit for a transaction and receives the corresponding tax revenue.
HB 2290 proposes clarifying the legal definition of a "business location" for sourcing purposes and specifies that the location of computer servers cannot be used to determine where an order is received. That may sound like a narrow, technical fix. But the bill could affect the amount of local government TPT collected by an individual jurisdiction if it changes how taxpayers source transactions within the state.
Why We Oppose HB 2290: Our Policy Positions Paper, developed by our Government Affairs Committee and adopted by our Board of Directors in June 2025, calls for a taxation system that is "fair, consistent, easily administered, and equitable." This bill falls short of that standard. In the context of e-commerce, TPT transactions from some Arizona-based corporations are already being sourced to the purchaser's location rather than the company's Arizona business location, and this bill could make that problem worse. When tax revenue is rerouted away from Sedona and the Verde Valley, our roads, parks, and the quality of place our visitors come to experience all suffer. Local businesses here cannot afford that loss. We urge our legislators to oppose this bill.
✅ SUPPORT: HB 2804 - Rural Development and Housing Tax Credit
Ask any business owner in Sedona what keeps them up at night, and the answer is almost always the same: we cannot find or keep workers because they cannot afford to live here. Restaurants are short-staffed. Healthcare providers are losing candidates to communities where a paycheck actually covers rent.
HB 2804, introduced by Rep. Teresa Martinez, would create a state tax credit program similar to the federal Low-Income Housing Tax Credit, limited to projects in counties with populations under 800,000. That excludes only Maricopa and Pima counties, making Yavapai and 13 other rural counties eligible. The bill would allocate up to $2 million in annual credits from 2026 through 2036 to help finance new affordable housing developments.
Why We Support HB 2804: Our adopted policy positions call on us to "support solutions that provide income-aligned housing and meet the needs of our region's workforce." This bill is a direct answer to that commitment. It is targeted, rural-first, and practical. Money would not come out of state coffers until after units are built and occupied, meaning the state would benefit from construction activity and new housing before spending a dime. We have said before that housing is our greatest opportunity to strengthen and sustain our community. This bill helps make that possible. We urge our legislators to support it.
✅ SUPPORT: HB 2429 - Vacation Rentals; Short-Term Rentals; Occupancy Limits
Sedona has one of the highest concentrations of short-term rentals of any community in Arizona. Most STR operators are responsible property owners. But the unchecked proliferation of investor-owned rentals has contributed to a severe shortage of long-term housing and brought noise, safety concerns, and instability to residential neighborhoods.
Since 2016, state law has largely prevented local governments from meaningfully addressing those impacts. HB 2429, sponsored by Rep. Selina Bliss of Prescott, makes targeted, carefully drawn changes. The bill sets a statewide overnight occupancy standard of two adults per sleeping area, plus up to two additional persons, and limits occupancy rules to overnight guests only. It extends the enforcement window for permit suspension, strengthens penalties for serious building code violations, and allows cities to deny permits when unpaid fines are attached to a property.
Why We Support HB 2429: Our adopted policy positions call for us to "support legislation to strengthen local authority over short-term rentals without superseding private property rights, to preserve housing access for the local workforce and residents." HB 2429 is that legislation. This bill does not threaten good operators or our tourism economy. It gives our community the tools to hold bad actors accountable and begin restoring the housing supply our workforce needs. We urge the Senate to pass it.
port it.
✅ SUPPORT: HB 2950 - Tourism Improvement Areas
Tourism is Sedona's lifeblood. It supports countless small business owners whose livelihoods and families depend on a steady, well-promoted flow of visitors. But promoting a destination takes sustained investment, and right now Arizona is falling behind.
HB 2950 would allow cities and counties to form Tourism Improvement Areas, or TIAs. These are districts in which lodging businesses collectively fund tourism marketing and promotion. Through contributions from lodging businesses representing 67% or more of total rooms within a designated area, a TIA creates a dedicated fund to attract more visitors, increase spending, and support local jobs, all without relying on resident taxpayer dollars. As of 2026, there are 216 tourism improvement areas in 25 states, with major competing destinations including Dallas, San Antonio, San Diego, Denver, Nashville, and Los Angeles already operating established programs.
Why We Support HB 2950: Our adopted policy positions call on us to "advocate for the continued and transparent allocation of tourism bed tax revenues to fund destination marketing efforts" and to "support coordinated efforts to brand Greater Sedona as a favorable environment for tourism." This bill delivers on both. According to Visit Phoenix, destinations with TIAs experience an average 2.1% increase in hotel room demand and a 4.5% increase in hotel room revenue compared with those without.
Our adopted policy positions also call for "communicating the value of tourism as an ongoing objective," and a TIA is the kind of dedicated infrastructure that can sustain that effort year after year. Arizona is losing market share to states like Texas and California, which are significantly outspending us in tourism marketing. HB 2950 gives communities like ours a real way to compete.
Make Your Voice Heard: Contact Your Legislators
If you have read this far, you care about where this community is headed. So do we.
The most powerful thing you can do right now is reach out directly to your elected representatives in the Arizona House and Senate. Legislators hear from lobbyists every day. They hear from constituents far less often. A phone call or personal email from a local business owner carries real weight.
Find your legislators. Visit azleg.gov/findmylegislator and enter your address to identify your Arizona House representative and Arizona state senator.