Arizona Property Owners May Soon Be Able to Charge Government for Security Costs Tied to Rampant Homelessness

Arizona property owners who install security equipment or have other expenses linked to unchecked homeless camps would be able to request a refund from the government under a proposal that was recently approved for the November ballot.

On Monday, Republicans in the state senate approved the referendum, which state house Republicans approved in late February. No Democrats supported the measure.

The measure was devised by the conservative Goldwater Institute in response to Phoenix’s handling of “the Zone,” a sprawling downtown homeless camp that city leaders allowed to grow until a judge declared it a public nuisance and ordered it to be cleared late last year.

Jenna Bentley, the Goldwater Institute’s director of government affairs, said property owners and businesses near the Zone never received real compensation for the damages they suffered.

“When property owners are being asked to pay taxes and they’re not receiving [public health] services, police aren’t responding, they’re asking the city for help and the city is kind of derelict in those responsibilities, we feel like it’s improper for the city to keep those funds,” she said.

According to the legislation behind the referendum, if a municipality fails to enforce laws around illegal camping or maintains a public nuisance, property owners can apply for a refund for “documented expenses to mitigate the effects,” up to the amount of their property-tax liability. The money would come from the municipality’s state shared revenue.

The expenses could include things such as security systems, fencing, windows, repairs to damaged property, and the costs to hire security guards. “We tried to keep it pretty broad,” Bentley said.

It’s unclear if a business could request a refund for lost revenue due to a homeless camp. If a refund request is denied, the property owner would have standing to take it to court.

The measure was sponsored by state senate president Warren Petersen and state house speaker Ben Toma. “Arizonans have had enough when it comes to lawlessness and city inaction,” Toma said of the effort in a prepared statement.

Democrats oppose the measure, saying it will make the crisis worse by diverting money that cities need to combat homelessness. State senator Priya Sundareshan, a Democrat from Tucson, said it is akin to defunding the police, according to the Arizona Daily Star.

“We talk about all of the different things that cities use their funding for, that if you take away their funds might result in reduced services,” she said during the senate vote. “And so I’m confused why we’re rushing to, in essence, defund the police when I know my colleagues on the other side have a problem with that.”

No one is talking about defunding the police, Bentley said. She called it “categorically untrue” to suggest that Arizona cities “are barely scraping by and don’t have the money to do this.” And, she noted, no government would have to pay claims if it’s doing its job.

“It’s kind of disingenuous to say this is going to cost government too much. What about what this is costing our community members, our neighborhoods?” she said.

The intent, she said, is to incentivize cities to address homeless camps before they get out of hand, and to understand that there will be consequences if they do not.

“Our hope is that people don’t have to utilize this tool,” Bentley said.

Arizona was the first state to propose a refund measure for expenses tied to public nuisances, though other states have since expressed interest, Bentley said. The measure needs a simple majority vote to pass. It couldn’t be vetoed by Katie Hobbs, Arizona’s Democratic governor.

“Governor Hobbs can oppose it if she chooses to,” Bentley said but added that her institute’s polling shows that the homeless crisis is not just a Republican issue. “Everyone is dealing with this. Everybody is concerned from all walks of life.”

Before it was cleared out in late 2023, more than 1,000 people were living in the Zone, freely shooting up heroin and smoking meth and fentanyl. They filled storm drains with human waste, rotten food, and garbage that flowed into the Rio Salado River Parkway. At least four people were killed in the Zone. Police were directed not to enforce the law there.

The city claimed its hands were tied by a pair of Ninth Circuit rulings, Martin v. City of Boise and Johnson v. Grants Pass, that limit the ability of municipalities to enforce camping bans on involuntarily homeless people with nowhere to go. The Supreme Court agreed in January to review the Grants Pass case.

Downtown neighbors and businesses sued the city of Phoenix, contending that the city was illegally maintaining a public nuisance. The judge in the case agreed.

Some are now pointing at Tucson as another hot spot for homeless camps in Arizona.

A recent count found a 60 percent increase in homelessness in Tucson over the past five years, according to media reports. More than 200 people are living at a camp at the 100-Acre Woods Bike Park, land that is owned by Davis-Monthan Air Force Base but leased by the city. A levee divides the camp from the nearest neighborhood.

Ilan Wurman, an Arizona State University constitutional law professor and one of the lawyers behind the Zone lawsuit, said homelessness in Tucson is bad, but it’s more scattered than it was in Phoenix. He filed a lawsuit in September on behalf of three Tucson residents similarly arguing that homeless people have set up encampments in a park in their community — bringing trash, fires, odors, obstructions, and crime — and have turned the park into a public nuisance.

They’re expected to go to trial this month.

“Our hope is this will be a bellwether trial. We already have a proof of concept from Phoenix. We’ll have a proof of concept on a smaller scale for smaller encampments in Tucson,” said Wurman, who hopes to use public-nuisance arguments to combat homeless camps elsewhere.

His firm has already filed a similar public nuisance lawsuit in Salt Lake City, Utah. Last month, a Missouri lawyer filed a public nuisance lawsuit against the city of St. Louis for allowing two squatters to camp in front a home for three years and to use the storm sewer as their toilet.

Tucson leaders say they should be immune from prosecution, that the city has a right to implement its own policies around homelessness, and that city residents shouldn’t be allowed to implement their preferred public-camping policy through a lawsuit.

It’s the same argument Phoenix city leaders made about the Zone.

“We’re not telling you what policy to have,” Wurman said. “What we’re saying is, if your policy leads to a public nuisance, you can’t do that.”