Key facts
- Arizona's House Bill 2999 establishes State Affordability Infrastructure Districts (SAIDs).
- SAIDs streamline infrastructure financing by removing the need for local jurisdiction approval.
- The districts can finance a wide array of public infrastructure and development impact fees.
- SAIDs can issue tax-exempt municipal bonds, including general obligation, special assessment, and revenue bonds.
- The formation of a SAID requires 100% landowner support and public infrastructure costs exceeding $5 million.
Arizona has enacted House Bill 2999, establishing State Affordability Infrastructure Districts (SAIDs) to address a long-standing need for more effective land development financing tools. This legislation aims to close a significant gap in transaction volume compared to other states like Colorado, Texas, Florida, and Utah, which have historically offered more usable and efficient infrastructure finance platforms.
The SAID structure, developed over nearly 20 years of effort by organizations like Launch, the Central Arizona Home Builders Association, and the Valley Partnership, simplifies the process by allowing districts to be formed through an application to the Arizona Finance Authority (AFA) without requiring local jurisdiction approval. This removes potential political hurdles, uncertainty, and delays that have plagued previous financing methods.
To form a SAID, a petition must be supported by 100% of landowners, and public infrastructure costs must exceed $5 million. The districts can finance a broad range of public infrastructure, including water, sewer, roads, parks, and digital infrastructure, as well as development impact fees. Bonds issued by SAIDs can be general obligation, special assessment, or revenue bonds, offering flexibility for various project types.
The SAID is governed by an initial three-member appointed board of fee property owners, with terms staggered for stability. Governance is designed to evolve towards homeowners as projects build out. This new financing tool is expected to be crucial for developers and homebuilders in Arizona, enabling them to deliver more lots and homes at affordable prices in a state experiencing significant growth.