Arizona SB 1189: suspension rights in revitalization district construction contracts

What changed: seven provisions every district construction contract must include

The Legislature's list of 2026 session laws gives chapter 217 to SB1189, under a short title that changed on the way through:

azleg.gov Session Laws, 2026, short title of chapter 0217 (SB1189)

campaign spending; personal security (NOW: construction contracts; revitalization districts)

The page prints the old short title and, on a second line, the new one.

The chaptered law opens:

Laws 2026, chapter 217, heading

CHAPTER 217 SENATE BILL 1189 AN ACT amending section 48-6808, Arizona Revised Statutes; relating to revitalization districts.

Four lines of the heading, run together here. The page's stylesheet shows the last of them in capitals.

Its first section rewrites section 48-6808:

Laws 2026, chapter 217, Section 1, opening words

Section 1. Section 48-6808, Arizona Revised Statutes, is amended to read:

Two parts of the section change. The first is subsection A, which lists the district's powers. Its opening words and its first paragraph now read:

Arizona Revised Statutes 48-6808(A), opening words

A. In addition to the powers otherwise granted to a district pursuant to this article, a district, to further the implementation of the general plan, may:

Arizona Revised Statutes 48-6808(A)(1)

1. Enter into contracts and spend monies for any infrastructure purpose with respect to the district. Any construction contracts the district enters into pursuant to this article shall comply with subsection F of this section.

The second is a new subsection F, which says what the district's construction contracts must contain:

Arizona Revised Statutes 48-6808(F), opening words

F. Any construction contract the district enters into must include provisions for all of the following:

Paragraph 1 is the contractor's right:

Arizona Revised Statutes 48-6808(F)(1)

1. Allowing a contractor to suspend performance or terminate a construction contract with a district for failure by the district to make timely payment of amounts certified and approved for payment. The contractor shall provide written notice to the district at least seven calendar days before the intended suspension or termination unless a shorter notice period is prescribed in the construction contract. A contractor shall not be deemed in breach of the construction contract for suspending performance or terminating under this paragraph. A construction contract shall not extend the time period for a contractor to suspend performance or terminate under this paragraph.

Paragraphs 2 to 4 give a subcontractor the same kind of right in three situations: the district and the contractor both fail to pay, the district pays and the contractor does not, and the district declines to certify part of the contractor's billing for reasons that are not the subcontractor's fault:

Arizona Revised Statutes 48-6808(F)(2)

2. Allowing a subcontractor to suspend performance or terminate a contract with a general contractor or subcontractor for a district if both of the following occur: (a) The district fails to make timely payment of amounts certified and approved for the subcontractor’s work. (b) The contractor fails to pay the subcontractor for that certified and approved work. The subcontractor shall provide written notice to the contractor and district at least three calendar days before the intended suspension or termination unless a shorter notice period is prescribed in the contract. A subcontractor shall not be deemed in breach for suspending performance or terminating under this paragraph.

The paragraph and its items (a) and (b) are printed on three lines, run together here. The notice sentences are printed inside item (b).

Arizona Revised Statutes 48-6808(F)(3)

3. Allowing A subcontractor to suspend performance or terminate if the district makes timely payment of certified and approved amounts for the subcontractor’s work but the contractor fails to pay the subcontractor. The subcontractor shall provide written notice to the contractor and district at least seven calendar days before the intended suspension or termination unless a shorter notice period is prescribed in the contract. A subcontractor shall not be deemed in breach for suspending performance or terminating under this paragraph.

The capital A in the first line is as the page prints it.

Arizona Revised Statutes 48-6808(F)(4)

4. Allowing a subcontractor to suspend performance or terminate if the district declines to approve and certify portions of the contractor’s billing for the subcontractor’s work for reasons that are not the fault of or directly related to that subcontractor’s work. The subcontractor shall provide written notice to the contractor and district at least seven calendar days before the intended suspension or termination unless a shorter notice period is prescribed in the contract. A subcontractor shall not be deemed in breach for suspending performance or terminating under this paragraph.

Paragraph 5 says what a suspension allows, and paragraph 6 covers fees:

Arizona Revised Statutes 48-6808(F)(5)

5. Allowing a contractor or subcontractor that suspends performance as prescribed in this subsection to cease furnishing further labor, materials or services until being paid the amount that was certified and approved, together with any reasonable costs incurred for mobilization resulting from any shutdown or restart of the project.

Arizona Revised Statutes 48-6808(F)(6)

6. Requiring the award of reasonable attorney fees and costs to the successful party in any action or arbitration to enforce rights under this subsection.

Paragraph 7, on when a written notice counts as given, is quoted further down. In the chaptered law, the second sentence of paragraph 1 of subsection A and all of subsection F are printed as added text, and the only word struck through in the section is may, in the opening words of subsection A, which the new text moves to the end of those words. The Legislature's copy of section 48-6808 already prints the amended text, without a history note, and this page quotes the section from it.

What the text leaves open: subsection F says the contract “must include provisions for all of the following”, and does not say what happens if a district's contract leaves one out. It turns on “timely payment” of amounts “certified and approved”, and neither section 48-6801 nor section 48-6808 defines those words or sets a number of days for the district to pay. The seven day and three day notice periods are floors the contract can shorten, not lengthen: each paragraph says “unless a shorter notice period is prescribed”.

Who it covers: revitalization district contracts, and no other owner

Subsection F speaks of “the district”. Section 48-6801 defines the word for the article that section 48-6808 sits in:

Arizona Revised Statutes 48-6801, opening words

In this article, unless the context otherwise requires:

Arizona Revised Statutes 48-6801, paragraph 3

3. “District” means a tax levying revitalization district formed pursuant to this article.

A district is formed by the governing body of one or more municipalities, after petitions from the owners of the property in it:

Arizona Revised Statutes 48-6802(A), part of the first sentence

the governing body of one or more municipalities may adopt a resolution declaring its intention to form a district to include property within the corporate boundaries of the district.

The end of the first sentence of subsection A. The words before it set the petitions from property owners that have to be presented first.

Arizona Revised Statutes 48-6801, paragraph 11

11. “Municipality” means an incorporated city or town and includes an Indian tribe or community.

Once formed, it is a public body of its own:

Arizona Revised Statutes 48-6807(B), second sentence

Except as otherwise provided in this section, a district is considered to be a municipal corporation and political subdivision of this state, separate and apart from the municipality.

Its power to contract in paragraph 1 of subsection A is for its infrastructure purposes, which section 48-6801 defines in part this way:

Arizona Revised Statutes 48-6801, paragraph 9, opening words and item (a)

9. “Infrastructure purpose” means: (a) Planning, design, engineering, construction, demolition, acquisition or installation of infrastructure.

The definition goes on to items (b) to (i), on existing facilities, real property, reserves, bonds and other costs; they are left out here.

So subsection F reaches a construction contract a revitalization district enters into. It does not reach a private owner, and it does not reach a city, town, county, school district or state agency contracting on its own account: chapter 217 amends no other section, and section 48-6808 speaks only of the district. On a district's contract, paragraph 1 covers the contractor who holds the contract with the district, and paragraphs 2 to 4 cover a subcontractor on it.

What the text leaves open: paragraph 2 speaks of a subcontractor's “contract with a general contractor or subcontractor for a district”, which reads as reaching lower tiers, while paragraphs 3 and 4 say only “a subcontractor”. The section requires provisions in the contract the district enters into, and does not say how those provisions reach a subcontract the district does not sign. The statutes quoted here do not list the districts that exist, and this page does not either.

Read sections 48-6801, 48-6802 and 48-6807: Arizona Revised Statutes section 48-6801, Arizona Revised Statutes section 48-6802 and Arizona Revised Statutes section 48-6807azleg.gov

From when: contracts executed after the effective date

Section 2 of the act says which contracts the new text reaches:

Laws 2026, chapter 217, Sec. 2

Sec. 2. Applicability Section 48-6808, Arizona Revised Statutes, as amended by this act, applies to any revitalization district infrastructure construction contract executed after the effective date of this act.

The heading and the sentence are on two lines, run together here.

The chaptered law ends with the Governor's approval and the filing:

Laws 2026, chapter 217, closing lines

APPROVED BY THE GOVERNOR JUNE 22, 2026. FILED IN THE OFFICE OF THE SECRETARY OF STATE JUNE 22, 2026.

Two lines, run together here.

The act has only those two sections and names no effective date. The Legislature's session laws page gives the general effective date for the session:

azleg.gov Session Laws, line above the table

The General Effective Date for the current session is 09/12/2026

And its table of general effective dates lists the 2026 session this way:

azleg.gov General Effective Dates, the 2026 row

Fifty-seventh Legislature - Second Regular Session 09-12-2026

The Session and Effective Date cells of the row under the year 2026, run together here. The row's Year and Notes cells are empty.

This page takes the act's effective date, September 12, 2026, from those two pages. It did not read the rule in the Arizona Constitution that sets the general effective date.

What the text leaves open: section 2 reaches a contract “executed after the effective date”, not on or after it, so a contract executed on September 12, 2026 itself is not clearly covered. Section 2 speaks of a “revitalization district infrastructure construction contract”, while subsection F says “Any construction contract”, and the text does not say whether a district construction contract that is not for infrastructure is covered. It says nothing about a change order or amendment made after the date to a contract executed before it.

Read the general effective dates: Arizona Legislature, General Effective Datesazleg.gov

What did not change: the rest of section 48-6808

The act amends one section of the Arizona Revised Statutes. In the chaptered law, only the opening words of subsection A, its paragraph 1 and the new subsection F carry the marks for added or struck text. Paragraphs 2 to 15 of subsection A and subsections B to E are printed without them, so the district's other powers are as they were, including the power to contract in subsection B:

Arizona Revised Statutes 48-6808(B), opening words and paragraph 1

B. In connection with any power authorized by statute, the district may: 1. Contract.

Two lines, run together here. Paragraphs 2 to 5 of subsection B are left out.

Subsection F adds to what a district's construction contract must contain. The section does not change the terms of a construction contract that any other owner signs.

What the text leaves open: this page did not read any other Arizona statute, and says nothing about how subsection F sits alongside other Arizona law on payment for construction work. The Arizona lien waiver forms linked at the foot of this page are under section 33-1008, a different part of the statutes.

The rest of subsection F, word for word

Paragraph 7 of subsection F:

Arizona Revised Statutes 48-6808(F)(7)

7. Requiring that any written notice prescribed by this subsection is deemed provided if either of the following occurs: (a) The written notice is delivered in person to the individual, member or officer of the entity for which it was intended. (b) The written notice is sent by any method that provides written, third-party verification of delivery to the last known business address of the party giving notice.

The paragraph and its items (a) and (b) are printed on three lines, run together here.

What the text leaves open: read as printed, item (b) counts delivery “to the last known business address of the party giving notice”, which is the sender's own address, not the address of the party the notice is for. The text does not explain this, and this page cannot say how it is read.

Of section 48-6808, this page quotes the opening words of subsection A and its paragraph 1, the opening words of subsection B and its paragraph 1, and all of subsection F. It leaves out paragraphs 2 to 15 of subsection A, paragraphs 2 to 5 of subsection B and subsections C to E, which the act does not change. Of chapter 217 it quotes the heading, the opening words of Section 1, all of Sec. 2 and the approval and filing lines, and it quotes the amended section from the Legislature's copy of the statutes; the chaptered law prints subsection F in the same words, in capitals. Of sections 48-6801, 48-6802 and 48-6807 it quotes only the parts shown. Each quote is checked against a saved copy of the official text when this page is built. Read the section, the chaptered law and the session laws list there:

Read the law: Arizona Revised Statutes section 48-6808, Laws 2026, chapter 217 (SB 1189) and Arizona Legislature, Session Laws listazleg.gov

What to do differently

Only what the text supports:

• Check who the owner is. Subsection F reaches “Any construction contract the district enters into”, where the district is a revitalization district under chapter 39 of title 48. On any other job it does not apply.
• Check the date the contract was executed. Section 2 applies the amended section to a district infrastructure construction contract “executed after the effective date of this act”.
• Read the contract for the seven provisions. The section says it “must include provisions for all of the following”, and does not say what happens if one is missing.
• Before you suspend or terminate, give written notice. A contractor gives the district at least seven calendar days. A subcontractor gives the contractor and the district at least three calendar days under paragraph 2 and seven under paragraphs 3 and 4. A shorter period in the contract controls, and a contract cannot extend the contractor's period under paragraph 1.
• Send the notice in a way that proves it arrived. Paragraph 7 counts a notice delivered in person to the individual, member or officer it was meant for, or sent by a method that gives written, third party verification of delivery.
• Keep a record of what was certified and approved. Every payment right in subsection F runs from amounts “certified and approved”, words the article does not define.
• If you suspend, the contract has to let you stop furnishing labor, materials or services until you are paid the certified and approved amount, “together with any reasonable costs incurred for mobilization resulting from any shutdown or restart of the project”.

Questions people ask

Does Arizona SB 1189 apply to private construction jobs?

No. It amends only section 48-6808, and subsection F speaks of “Any construction contract the district enters into”, meaning a revitalization district under chapter 39 of title 48. It says nothing about a private owner or about any other public owner.

How much notice does a contractor give before suspending work for a revitalization district?

Paragraph 1 of subsection F says the contractor “shall provide written notice to the district at least seven calendar days before the intended suspension or termination unless a shorter notice period is prescribed in the construction contract”, and a construction contract “shall not extend” that period.

When can a subcontractor suspend or terminate?

In three situations: when the district fails to make timely payment of amounts certified and approved for the subcontractor's work and the contractor fails to pay for it (three calendar days' notice), when the district pays but the contractor does not (seven), and when the district declines to certify part of the contractor's billing for the subcontractor's work for reasons that are not the subcontractor's fault (seven). The notice goes to the contractor and the district.

Who pays the lawyers if it ends in a dispute?

The contract has to require “the award of reasonable attorney fees and costs to the successful party in any action or arbitration to enforce rights under this subsection”.

From when does it apply?

Section 2 of the act applies it to “any revitalization district infrastructure construction contract executed after the effective date of this act”. The act names no date; the Legislature lists the general effective date of the 2026 session as 09/12/2026. The chaptered law shows it approved by the Governor on June 22, 2026.

Arizona lien waiver forms under section 33-1008, a different part of the statutes from the revitalization district contract rules in section 48-6808

Other state changes to how contractors get paid are on the construction law changes page.

This page quotes Arizona Revised Statutes section 48-6808, as amended by Senate Bill 1189 (Laws 2026, chapter 217) and explains what it says. It is not legal advice, and a statute can be amended. Read the linked section before you rely on it.